Drug Scarcity A Threat to Health and National Security

Bringing drug manufacturing back home through incentives is key given critical vulnerabilities in U.S. drug supply and dependence on China.

Zadorozhnyi Viktor/Shutterstock

There are three main factors that separate a healthy population from one riddled with disease: good food, clean water, and essential medicine.

While all medications serve a purpose, only some are considered essential. Essential medicines fulfill the highest public health priorities. The World Health Organization (WHO) has maintained a list of essential medicines since 1977. These medications are selected based on the prevalence of the diseases they treat, evidence of their efficacy and safety, and their cost-effectiveness. Due to their critical importance, essential medicines should be available at affordable costs in functioning health systems at all times.

The WHO’s essential medicines list is updated every couple years and serves as a reference for countries looking to evaluate the medical needs and priorities of their populations.

The Public Health Risk

In August 2020, an executive order from then-President Donald Trump compelled the U.S. Food and Drug Administration (FDA) to check the nation’s stock of medical essentials for combating everything from emerging infectious diseases to biological and radiological threats.

The audit uncovered an alarming lack of nearly 300 critical medicines—showing that national drug shortages were at an all-time high.

While the FDA managed to prevent a record number of drug shortages in 2021, gaps remain, leaving Americans vulnerable to threats that modern medicine should guard against. Short supplies affect emergency rooms and cancer treatments, and examples include both prescription medications and over-the-counter drugs.

Shortages leave the population vulnerable to counterfeit pills, which are designed to look like legitimate pharmaceuticals but can result in unexpected overdoses because they expose users to drugs that they never intended to take. Evidence of counterfeit pill use in overdose deaths more than doubled from 2019 to 2021 and tripled in western U.S. states, according to a recent report from the U.S. Centers for Disease Control and Prevention. Counterfeit pills frequently contain dangerous substances such as fentanyl, benzodiazepines, and other illegal drugs.

The National Security Risk

Shortages of essential medicines have plagued the United States for years and have continued worsening despite repeated calls to action. From 2021 to 2022 alone, new shortages rose by nearly 30 percent.

This significant shortfall in medical essentials is more than just a risk to public health, according to a 2023 report titled “Short Supply: The Health and National Security Risks of Drug Shortages” by the Senate Committee on Homeland Security and Governmental Affairs.

“These risks carry devastating, yet avoidable consequences for all Americans, including our military,” the report reads. “Until the federal government and industry strengthen efforts to jointly assess and address their underlying causes, drug shortages will remain a consistent health and national security risk.”

The report highlights a major kink in our poorly performing drug supply chain: an unhealthy over-reliance on foreign sources for both medications and the raw materials needed to make them.

There’s no mystery about how this problem took shape.

Like much of American manufacturing, American drug companies have increasingly outsourced their operations to overseas entities since the 1990s. Cheaper labor and fewer regulations make for a more attractive business environment.

A 2019 FDA analysis found that the lack of incentives for less profitable generic drugs regularly used in hospitals was a key factor.

While it may not be so lucrative to manufacture critical generic drugs, the result of our dwindling domestic production means longer supply chains with greater logistical challenges and less oversight.

Previous Senate reports found that nearly 80 percent of manufacturing facilities that produce the key ingredients that give a drug its intended effect are located outside of the United States. However, the FDA had only inspected 1 in 5 registered human drug manufacturing facilities.

Companies based outside the United States don’t have to follow U.S. regulations unless they’ve agreed to do so in documents submitted to the FDA or they want to sell their products in the United States. There are no rules about how often foreign facilities have to be inspected by the FDA.

Overseas Ties Bind US Medicine Supply 

The “Short Supply” report found that the number of China-based drug manufacturers registered with the FDA more than doubled between 2010 and 2015. Estimates suggest that 90 to 95 percent of one essential drug group—generic sterile injectables for critical acute care in the United States—relies on starting materials from China and India.

These overseas dependencies will make future shortages hard to predict and prevent. Because most of our drug manufacturing takes place overseas, neither the federal government nor the pharmaceutical industry has a clear view of how the shortages arise or when they begin.

The Senate committee called on Congress, the president, and the pharmaceutical industry to work together to make the whole process more visible, but doing so will take determined steps.

One strategy is focusing on the top priorities. If we simply keep better tabs on our most important drugs, we won’t fall prey to future catastrophic shortfalls. That’s the aim of the Essential Medicines Strategic Stockpile Act, introduced by Reps. Earl L. Carter (R-GA), Lisa Blunt Rochester (D-DE), and Nancy Mace (R-SC) earlier this year.

The bill would require the Department of Health and Human Services to establish a list of no more than 50 generic drugs as public health essentials, much in the same way that the nation has a reserve of oil for energy-related emergencies. 

Bring Back Domestic Production: Experts

Although lawmakers have called for a more transparent supply chain for years, some experts say the fundamental fix is to bring drug manufacturing back home.

Foreign drug manufacturing not only increases our risk of lacking medical necessities but also places a vital and sensitive commodity in the hands of an adversary, according to the Brookings Institute, a Washington-based public-policy think tank.

“Right now, there are many complicating issues in the relationship with China including trade, national security, and foreign policy. As the two countries move from a relationship that emphasized cooperation to one that is either competitive or conflictual, the risk of medical drugs being made in China increases,” a Brookings commentary titled “Time to make essential medicines within the United States” reads. “[It] is risky for the United States to rely heavily upon China during a time of considerable tension.”

To put our current drug manufacturing situation in perspective, consider that China produces 95 percent of all ibuprofen, 91 percent of hydrocortisone, more than 70 percent of Tylenol, and nearly half of the penicillin supply, according to the Council on Foreign Relations, a think tank.

To bolster domestic capability, Brookings recommends incentives such as tax credits, loans, infrastructure investment, and production support for U.S. drug firms.

Another bill, the Medical Manufacturing, Economic Development, and Sustainability Act, also proposes federal incentives to bring drug manufacturing back to the United States. The bill was reintroduced to Congress by Rep. Jenniffer González-Colón (R-PR). A similar bill has been reintroduced to the Senate.

“Forty percent of our finished medications and eighty percent of their active ingredients are manufactured in China; and most of the manufacturing sites for medical countermeasures for use against biological, chemical, and radiation threats are located outside of the United States, mainly in China,” Ms. González-Colón said in a statement. “Strengthening the U.S. medical supply chain is not only an issue of economic development, it is essential to our national security.”