America’s reliance on China for drug ingredients has raised alarm bells in Congress. House committees will hold two hearings Tuesday on drug shortages and the US Food and Drug Administration’s foreign inspection program, which has seen a large drop in visits to Chinese factories over the last few years, due in large part to the Covid pandemic.
The report put together ahead of the hearings by the Coalition for a Prosperous America, a trade organization pushing for tax breaks for domestic manufacturing, showed India-based Aurobindo Pharma Ltd. gets about 55% of its raw materials for ingredients from China. Aurobindo is a bellwether for the industry: It supplies the most generic drugs by volume to the US, and its $3.1 billion in 2023 revenue was second-highest among Indian drugmakers, according to data compiled by Bloomberg. The company’s 2022-2023 annual report said it has “a high dependence on the China market” for materials and ingredients used to make drugs.
“We did suspect they had ties to China, we just didn’t know how much,” said Nick Iacovella, a spokesman for the coalition. “This is really a red flag.”
President Joe Biden’s administration has focused its efforts on deepening its collaboration with India, where US relations are good in comparison with China. As tensions with the Asian superpower grow, so do concerns over how the US and the rest of the world count on the country for many pharmaceuticals, particularly the key ingredients used to make drugs.
Security Threat
US military officials have gone so far as to call vulnerabilities in the drug supply chain a national security threat, and the Defense Department has begun an effort to test generic drugs for safety and effectiveness.
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