US faces mounting risks from China's growing pharmaceutical dominance

A new report warns that China’s increasing control over key pharmaceutical components could threaten US drug security amid geopolitical tensions, prompting calls for domestic manufacturing and regulatory reforms.

A recent report by the US-China Economic and Security Review Commission has raised significant concerns about China’s growing dominance in the global pharmaceutical sector and the potential risks this poses to the US drug supply chain and healthcare sys...

tem. Although China’s role in pharmaceutical manufacturing is well-known, the report provides a detailed assessment of how this dominance could evolve into a critical vulnerability for the United States if decisive action is not taken.

The report highlights China’s substantial control over several key areas within the pharmaceutical supply chain, including the production of active pharmaceutical ingredients (APIs), contract research and development (R&D) manufacturing, and the creation of new therapeutics. In 2024, the value of drugs licensed globally from China reached approximately $48 million, signalling the country’s increasingly influential presence in the pharmaceutical market. The commission underscores the concern that US pharmaceutical manufacturers, while grappling with a patent cliff impacting $200 million worth of drugs by 2030, are likely to continue partnering with Chinese firms, further entrenching reliance on China. This is compounded by China’s advancements in synthetic biology, which reinforce its control over crucial supply chain “chokepoints.”

Despite US imports of finished oral and injectable medications from China being relatively low, 3% and 9%, respectively, the US is substantially more reliant on Chinese raw pharmaceutical ingredients. Nearly a quarter of APIs in US generic drugs are estimated to originate from Chinese sources, often routed through India, which serves as a critical intermediary. The situation is even more opaque when it comes to key starting materials (KSMs), chemically critical compounds used to synthesise APIs; estimates suggest that between 25% and 50% of US generic drugs incorporate KSMs sourced from China. The report stresses the poor visibility into supply chain specifics as a major obstacle in fully understanding and mitigating risk.

China has not yet weaponised its pharmaceutical supply chain dominance, likely due to reputational considerations on the global stage, but the report warns that the country is in an advantageous position to leverage this dominance as geopolitical tensions with the US escalate. The intertwining of US firms with Chinese contract development and manufacturing organisations (CDMOs), such as Wuxi AppTec, has deepened this dependence. While these partnerships help US companies reduce R&D costs and risks, they simultaneously bolster China’s biomanufacturing capabilities.

Legislative attempts to address these concerns have faced challenges. The BIOSECURE Act, designed to curb reliance on foreign adversaries by restricting certain Chinese biotech firms’ access to US markets, encountered hurdles in Congress due to tariff implications and uncertain future trade dynamics. However, a version of this act has been included as an amendment in the 2026 National Defense Authorization Act (NDAA) after Senate approval in October 2025, though it is still subject to negotiation with the House.

Meanwhile, broader analyses from institutions like the Brookings Institution and US Pharmacopeia corroborate the depth of US dependence on China. The Brookings study reveals that Chinese APIs are present in roughly 25% of drugs sold in the US, particularly in early-stage, less-regulated production steps. US Pharmacopeia’s report adds that 58% of key starting materials for US-approved APIs come exclusively from a single country, with China alone accounting for 41%, highlighting the precarious nature of the current supply chain. This narrow sourcing creates a significant risk of disruption, which could quickly ripple through the US pharmaceutical production ecosystem.

Other reports draw attention to the criticality of China’s supply chain role. Exiger’s study emphasises that 75% of essential medicines in the US are imported, with China producing 60% of global APIs, including 90% of antibiotic APIs used in the US. This concentrated supply risks exploitation during geopolitical crises and raises ethical concerns such as quality control failures and forced labour, further complicating reliance on Chinese sources.

Geopolitical implications loom large, as evident from analyses by the Atlantic Council, which details how China’s near-monopoly over certain pharmaceutical inputs could be weaponised in trade disputes. In 2024, China accounted for nearly 40% of US pharmaceutical imports, dominating the supply of critical components such as sulfonamide-class antibiotics. This strategic leverage amplifies the potential risks to US public health and economic security.

However, diplomatic efforts have also made some progress. Recent talks between US and Chinese officials have led to agreements on regulating fentanyl precursor chemicals, a significant step in addressing the opioid crisis, indicating potential areas for cooperation despite broader tensions. This deal included China listing 13 fentanyl precursors under regulatory oversight in exchange for reduced US tariffs on Chinese goods.

In response to these multifaceted challenges, the US government is pushing to onshore pharmaceutical manufacturing to rebuild domestic capacity and reduce foreign dependency. Nonetheless, as the commission notes, decoupling from entrenched Chinese biopharmaceutical companies may take up to eight years, underscoring the urgency of strategic planning and policy intervention.

To combat supply chain opacity and vulnerability, the commission recommends empowering the Food and Drug Administration (FDA) with legal authority to mandate transparent reporting from drug manufacturers regarding the quantities and origins of APIs and KSMs used in medicines consumed in the US. Enhancing supply chain visibility and diversifying sources are seen as critical steps to establish greater resilience and reduce reliance on countries with potential geopolitical leverage.

In conclusion, while the US pharmaceutical sector currently operates under significant reliance on China, the evolving geopolitical landscape and strong supply chain interdependencies demand urgent and sustained efforts to safeguard national healthcare security. Legislative and regulatory measures, alongside strategic diversification and domestic manufacturing initiatives, will be essential to mitigate future risks posed by China’s pharmaceutical dominance.

Source: Noah Wire Services