As the Covid-19 pandemic spreads to every corner of the world, many in the United States are wondering about the depth of its impact on the economy and the American people. Another, perhaps more critical, issue we need to address is what lessons we can learn from the current crisis to improve our health care system and to prepare for future unforeseen, “black swan” events. In particular, Washington should be examining the role of prescription drugs in terms of the national security challenge posed to it by China.
Health care in America is dependent on a long and complex drug supply chain which most often originates in China. Outside of a few policy makers in Washington, not many in the media or academia are examining the role China plays in producing critical medications and active pharmaceutical ingredients (API’s) for the United States. Yet the data on this strategic vulnerability are shocking and sobering. Over 97% of all antibiotics consumed in the US are manufactured in China along with 80% of our API’s. The result is that China maintains a global chokehold on the chemical components that make the key ingredients found in the vast majority of our prescription drugs. About 40% of all generic drugs in the US have a single manufacturing source, most likely China. No companies in the United States manufacture Vitamin C. The last penicillin manufacturing facility in the US closed in 2004. Of the two tons of heparin used in the US each month, 70% is manufactured in China. The key API’s in generic medications which treat high blood pressure, Alzheimer’s, Parkinson’s, epilepsy, depression, and cancers, among other health concerns, all originate in China. Even the US source of treatment for anthrax, ciprofloxacin, originates in China.
How did the United States, and much of the western world, become so heavily dependent on China to supply its critical drug needs? In part it results from China’s long-term, strategic planning. “Long-term” is a difficult concept for many American policymakers to grasp as Washington operates on election cycles. In 1984 the US Congress passed a generic drug law with the goal of reducing the cost of medicine. The long-term, unplanned for, result was American pharmaceutical companies off-shored production to the East to reduce labor and production costs.
The culture of the Chinese Communist Party (CCP), in contrast, analyzes the world through a generational lens. Its economic plans are ten years in length. The Unequal Treaties period in its history, which ended in the early 20th century, is spoken of as yesterday’s great national shame. China’s game plan, as stated in CCP doctrine, is to emerge in the coming decades as the dominant global supplier of prescription drugs and API’s. To accomplish its long-term The medicine works only if order cialis online the user is sexually aroused otherwise it is simply discarded by the body. online purchase of cialis Also these generic medications gives same results but in less than 30 minutes. 4. The role of the partner is crucial in levitra without prescription this link overcoming Performance Anxiety. Moreover, owners are given two options for selling their laptop; they can either exchange it at buy viagra prescription the time of sex. goal China was willing to dump products below market price to drive out competitors. Once it was able to sole-source medications, such as penicillin and cancer treatment drugs, Chinese manufacturers raised prices. There never was an intention on China’s part to create a level playing field. It aims to be the world’s pharmacy in keeping with its “Made in China 2025” plan.
As Brigadier General John Adams told NBC News last fall, “Basically we’ve outsourced our entire industry to China… I think they know exactly what they’re doing and they’re incredibly good strategists. They’re doing this, they select their industries for the future, and they’ve got a plan.” The US is in a precarious position. Even if China continued to supply the world with prescription drugs and API’s at free market prices its quality control is not up to FDA or European pharmaceutical standards. In 2018 alone the FDA issued 50 recalls for Chinese blood pressure medications because the API, Valsartan, contained jet-fuel contaminants which are known to cause cancer in one in 8,000 people! The FDA has less than 30 staff inspecting over 3,000 manufacturing facilities. When the FDA is permitted to inspect a plant in China it must provide advanced notice. Often documents are not translated into English and, generally, no independent interpreter is provided during the inspection itself. Finally, the FDA has no means of enforcement in China. The US is in such a dire situation that the FDA has reversed its bans on some Chinese API’s because, it said, it is better to have a poor choice than none at all.
The United States has a short window of opportunity to alter the strategic drug marketplace. China won’t reach its global drug supplier ambitions in this decade. But, it will be capable of leveraging its power within a couple. For American policymakers this is someone else’s problem down the road. The reality is that prescription drugs are not a commodity but a strategic asset that needs to be protected or the US will see a repetition of early 1990’s policy when Washington said the US had nothing to fear from China as it was “three-to-four generations behind” in advanced technology.
There is a three-pronged approach the United States can take in 2020. First, Washington’s thinking must come to understand that pharmaceuticals are a strategic asset and treat them as such. While they are part of the private sector economy they serve a public good. Second, manufacturing of API’s and important pharmaceuticals must be returned to America’s shores. Their loss resulted in hundreds of thousands of manufacturing jobs going overseas and tens of thousands of research positions lost to China. A robust pharmaceutical industry is good for the security of the country and the work force. Finally, the United States must start a tracking and forecasting system as exists for the food supply industry. Right now there are over 8,000 chemical plants in the US, but little to no tracking of pre-cursor chemicals. Washington needs to think strategically and long-term. The situation needs to be remedied this decade so that the next one doesn’t find the country experiencing a new black swan event from which we can no longer recover.
DARIA NOVAK served in the United States State Department during the Reagan Administration, and currently is on the Board of the American Analysis of News and Media Inc., which publishes usagovpolicy.com and the New York Analysis of Policy and Government. Each Friday, she presents key updates on China.
Illustration: Pixabay