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President Donald Trump is poised to sign an executive order requiring some essential drugs to now be made in the United States.
In an apparent effort to limit the nation’s dependency on China for certain medical supplies and drugs in the wake of the coronavirus pandemic, the White House may be issuing the order as early as Friday, sources told CNBC.
“It is critical that we reduce our dependence on foreign manufacturers for essential medicines, medical countermeasures’’ to “ensure sufficient and reliable long-term domestic manufacturing’,” a draft of the order obtained by Bloomberg News read, noting that the production would aim to prevent shortages of supplies as seen in the pandemic’s outbreak.
The nine-page draft has reportedly been reviewed by federal agencies, including the Department of Health and Human Services and the Pentagon, where an official confirmed to Bloomberg Thursday that it was under review.
While a list of “essential medicines” is to be determined at a later time, the pending order will prevent any manufacturers except those in the U.S. from being awarded federal contracts for the supplies. Competitive pricing for supplies used for public health emergency or biohazard attack will be encouraged by requiring production to be divided among multiple companies, Bloomberg reported.
Exceptions to the order included a rise in prices by more than 25%, an insufficient quantity of a treatment or device being produced, or if it is not in the public interest.
According to Bloomberg:
The federal government frequently must create incentives for companies to develop medical treatments for public health emergencies because they aren’t typically profitable. The HHS spends billions each year partnering with pharmaceutical companies to get them to research and produce the drugs and devices.
The HHS would be tasked with identifying vulnerabilities in the supply chain for those drugs and medical devices and share information with other federal agencies under the order. The HHS would also be able to write new regulations on the sources of those drugs, their use, and how facilities are inspected.
White House trade advisor Peter Navarro had proposed an order for “American-made” drugs back in March, but it was not yet clear if the reported draft currently under works is the same.
“This Big Pharma spin is simply a desperate attempt to stop President Donald J. Trump from moving the production of our essential medicines and medical equipment and supplies to the U.S,” Navarro had told CNBC, speaking about the lobbying against his executive order.
Navarro’s proposed order would impose on U.S. facilities similar Food and Drug Administration (FDA) restrictions as those imposed abroad as well as encouraging the Department of Defense, Department of Health and Human Services, Department of Veterans Affairs and other government agencies to only buy American-made medical products.
“The pharmaceutical and device chain is incredibly complex, and it will be very difficult, at least in the near term, to become completely independent from foreign sources,” Chris Meekins, former HHS deputy assistant secretary for preparedness and response, said.
“If you’re going to focus on the national security and health security threat of having essential medicines produced overseas, you have to look at the entire supply chain, not just the last step in it,” he added, according to Bloomberg. “Having a manufacturer in the United States for the finished product does little good if they cannot have access to active pharmaceutical ingredients or raw materials.”
Rep. Michael McCaul, chairman of the China Task Force committee, applauded the president for recently signing an executive order that will be giving an international development finance agency the ability to issue low-interest loans to companies boosting the country’s medical stockpile.
“For far too long the United States has relied on China to produce essential goods, such as medicine, medical supplies and Personal protective equipment,” the Texas Republican congressman and ranking member of the House Foreign Relations Committee said in a statement.”We can’t bet Americans’ health and security on the potential malign decisions of our strategic adversary, the Chinese Communist Party.”
According to the Food and Drug Administration, 80% of the active ingredients used in drug production actually come from outside of the U.S.
“The security of the nation’s drug supply rests on three main factors: freedom from dependence on foreign sources of API [active pharmaceutical ingredients], the resilience of our domestic manufacturing base, and the reliability of the facilities that make products for the U.S. market,” Janet Woodcock, director of the FDA’s Center for Drug Evaluation and Research, noted in Congressional testimony last October.
“The increasing number of API manufacturing sites in China and other countries suggests that the United States’ reliance on Chinese and other foreign sources of API is growing,” Woodcock reported. “FDA has been working diligently in collaboration with industry and other federal agencies to ensure our reliance of foreign manufacturing does not pose a national security risk.”
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