Securing America’s Biotechnology Leadership

America’s leadership in biotechnology is not an accident. It is the result of decades of deliberate policy decisions designed to foster collaboration between federal agencies, universities, and private companies, with each performing an indispensable role.

The foundation of this system dates to the closing days of World War II, when White House adviser Vannevar Bush published his seminal Science, The Endless Frontier report, arguing that sustained federal investment in basic research and scientific training would be essential to America’s future prosperity and security.

His vision helped shape the postwar research system. The federal government would finance basic scientific research that may — or may not — have any immediately obvious commercial application. Researchers would compete for funding on the scientific merit of their hypotheses. And their collective discoveries would lead to unforeseeable technological breakthroughs that grow our economy and bolster our security.

Agencies like the National Institutes of Health and National Science Foundation subsequently poured federal research dollars into universities and laboratories across the country. NIH became the country’s primary funder of basic biomedical research, while agencies such as DARPA later funded high-risk scientific programs tied to national security needs.

More recently, BARDA and ARPA-H have helped support research and development aimed at translating promising science into technologies and medical countermeasures. Federal officials have long recognized these investments as critical for our national security, since during a pandemic or biological attack, America needs a robust scientific infrastructure capable of rapidly developing new diagnostics, vaccines, and treatments.

However, government funding alone doesn’t create new medicines. That’s where America’s universities and private sector come in.

The Bayh-Dole Act of 1980 gave universities and other federal grant recipients the ability to retain the patent rights on their inventions and license those discoveries to private-sector partners with the capital and expertise needed to develop them into real-world products. The Economist Technology Quarterly later called it “possibly the most inspired piece of legislation to be enacted in America over the past half-century.”

That division of labor allows each part of the system to do what it does best. Taxpayers support foundational research that’s too speculative for private investors. Universities and federal laboratories generate new knowledge and train scientists. Biotech companies and investors assume enormous financial risks to turn initial discoveries into products that patients rely on.

Of course, these collaborations depend on America training and retaining the world’s best scientists.

Historically, scientific talent has flocked to the United States, enticed by the opportunity to perform cutting-edge research and also by the political and economic freedoms and privileges that we too often take for granted.

In 2024, temporary visa holders earned 38% of all science and engineering doctorates awarded by American universities. Optional Practical Training, or OPT, has traditionally allowed international graduates to work in their fields for 12 months after graduation, with qualifying STEM graduates eligible for an additional 24 months. That gives American companies an opportunity to hire scientists that U.S. universities have already spent years educating.

Today, several parts of this system are simultaneously under strain.

The current administration initially proposed reducing NIH funding in fiscal 2026 by a staggering 40%, though Congress ultimately rejected those cuts and slightly increased the agency’s budget. But layoffs, reductions in force, and other measures still reduced NIH’s workforce from over 21,400 employees at the end of 2024 to about 17,000 by the end of 2025 — a loss of roughly one-fifth of the agency.

By May 2026, Nature reported that staffing shortages were forcing some NIH units to prioritize required grant renewals over new awards. Through August 2026, NIH had funded 9,714 fewer grants than at the same point two years earlier.

The administration has also given political appointees an outsized role in grantmaking. An August 2025 executive order instructs senior appointees to review discretionary awards before they are issued and potentially cancel grants that don’t advance the president’s policy priorities. OMB has since proposed incorporating similar requirements into government-wide grant rules.

Meanwhile, new immigration rules are making the employment pathway for foreign researchers less predictable. A Department of Homeland Security rule that took effect in September 2026 replaced open-ended “duration of status” admissions for foreign students on F-1 visas with fixed admission periods. That means that, after a transition period ending March 18, 2027, many graduates seeking Optional Practical Training will generally need to obtain an extension of stay in addition to employment authorization. DHS has also announced a separate rulemaking that would impose hefty fees on students seeking to engage in OPT.

These changes are cumulatively threatening the public-private research ecosystem on which America’s biotech leadership has long depended.

Policy Proposals to Strengthen Pillar 1

To continue leading the global biotech industry, America must attract, retain, and train the world’s top scientists and engineers, and ensure they have the long-term funding and support they need to make breakthrough discoveries. That will require action from both Congress and the executive branch.

For decades, the Food and Drug Administration (FDA) was widely regarded as the world’s most capable and scientifically sophisticated pharmaceutical regulator. Its rigorous reviews protected American patients from unsafe medicines, most notably in the early 1960s, when it refused to approve thalidomide, a drug already available in many European countries that was later linked to thousands of severe birth defects.

At the same time, the FDA offered drug developers demanding, but generally predictable, pathways to demonstrate that their medicines were safe and effective.

But the medicines that the agency regulates have changed dramatically. Drug development is increasingly moving away from one-size-fits-all treatments and toward therapies targeted to patients based on genetic mutations, biomarkers, molecular characteristics, and other individual differences. Some new gene and RNA therapies are designed for extraordinarily small populations — in extreme cases, just one or a handful of patients.

The FDA has acknowledged that these advances create regulatory challenges and can make conventional randomized trials impractical or even impossible.

Simply put, regulations must evolve alongside the science. Biomarkers can help researchers identify which patients are most likely to benefit from a therapy. Genomic data can divide a once-broad disease population into increasingly precise subgroups. Modern statistical methods, real-world evidence, adaptive trials, and model-informed drug development can generate useful evidence more efficiently. And artificial intelligence can help analyze this data faster and in greater depth than ever before.

Yet companies still face lengthy and sometimes duplicative processes for beginning clinical studies, activating trial sites, securing institutional reviews, and responding to regulatory questions. The FDA itself admits that first-in-human clinical trials can take as long as two years to complete in the United States.

Meanwhile, China has reformed its drug regulatory system to accelerate development and strengthen its pharmaceutical industry as part of a decades-long, state-directed strategy to harness biotechnology and medicine for national security, global influence, and economic competitiveness. In 2017, Beijing joined the International Council for Harmonisation, aligning more of its regulatory standards with international practice. China subsequently adopted an “implied approval” system under which clinical trials may proceed if regulators do not object within 60 working days. In 2025, regulators added an expedited pathway that can cut review of qualifying innovative-drug trials to just 30 working days.

Those reforms have helped make China an attractive place to test new medicines. The Council on Foreign Relations estimates that China’s share of global clinical-trial starts climbed from roughly 1% in 2009 to 30% in 2024. Recent analysis also finds that the average Phase I trial in China takes half as long to conduct and costs roughly 40% less than a comparable U.S. trial. In 2024, China registered more than 7,100 clinical trials, compared with about 6,000 in the United States.

China also has an enormous patient population concentrated in large research hospitals and clinical centers, which gives trial sponsors access to large pools of eligible participants. Recent industry analysis estimates that Chinese sites can enroll patients two to five times faster than the global benchmark. China now has more than 1,500 clinical sites.

China’s reforms and clinical infrastructure have made it an increasingly attractive destination for early-stage trials, with implications for U.S. national security. As more development moves abroad, America risks losing expertise and capacity that help determine which medicines reach patients and how quickly. While preserving the rigorous standards that underpin trust in U.S. medicine, sustaining U.S. capacity will require both robust investment and comprehensive reforms to reduce the regulatory delays and costs that drive innovation elsewhere.

It makes little sense to categorically restrict American biotech firms from conducting some clinical trials in China, or relying on data generated there, to inform FDA submissions. Forcing companies to duplicate research would waste companies’ limited capital and prevent them from pursuing as many promising research programs as possible. That, in turn, would delay the arrival of new treatments for American patients and slow U.S. innovation while Chinese competitors move ahead.

Instead, companies and regulators must ensure that any trials conducted in China adhere to the FDA’s rigorous safety and ethical standards. In a recent statement, the FDA reaffirmed that clinical trials conducted abroad must meet the same Good Clinical Practice standards as American studies, including informed consent, reliable data, and access to regulatory inspections. The FDA is expanding inspections of foreign clinical-trial sites and seeking greater transparency when inspectors are denied access.

Federal officials can also spur more domestic clinical trials by making it faster and less expensive to conduct them here.

Leading officials already recognize the need for reforms. The federal government’s 2022 National Biodefense Strategy explicitly called for strengthening domestic clinical-trial infrastructure, including international sites where appropriate, to improve emergency preparedness.

And earlier in 2026, the Department of Health and Human Services and the FDA launched Operation TrialBlazer to modernize clinical development while preserving safety and effectiveness standards. Its new Expedited IND Pilot allows components of first-in-human trial applications to be submitted and reviewed on a rolling basis, encourages regulatory review and trial-site activation to occur in parallel rather than sequentially, and seeks to tailor early-stage requirements to the actual scientific risks involved.

Policy Proposals to Strengthen Pillar 2

Those are important first steps. Congress and the executive branch can build on them by making it faster and less expensive to conduct clinical trials in the United States, without compromising scientific rigor or patients’ safety.

Manufacturing drugs at scale depends on a commercial ecosystem that’s every bit as sophisticated as the research ecosystem that produces the medicine and the regulatory system that approves it.

A finished drug may be assembled in one country, using active pharmaceutical ingredients manufactured in another, which are made from chemical precursors produced in a third nation.

Roughly half of brand-name drugs and 69% of generic drugs sold in the United States are manufactured abroad. Just 9% of manufacturers producing APIs for FDA-approved medicines are in the United States, compared with 22% in China and 44% in India.

That global network gives American drugmakers access to specialized expertise and production capacity no single country could build alone. But it also creates potentially dangerous choke points for certain essential medicines. A 2025 U.S.-China Economic and Security Review Commission analysis identified 36 mostly generic medicines whose public regulatory filings suggested potentially exclusive reliance on Chinese API manufacturers. China is also a major producer of the chemical precursors and key starting materials that manufacturers in India, Europe, and elsewhere use to make APIs.

Washington has already begun trying to reduce these dependencies. The BIOSECURE provisions enacted in the 2026 National Defense Authorization Act will restrict federal contracts, grants, and loans involving biotechnology equipment or services supplied by designated foreign-adversary “biotechnology companies of concern” — potentially requiring companies doing business with the federal government to replace certain Chinese suppliers and contract manufacturers.

The administration has also imposed tariffs of up to 100% on certain patented pharmaceuticals and ingredients, while offering lower rates or exemptions for companies that shift production to America or qualify under agreements with trusted trading partners.

Policymakers have legitimate concerns about an overreliance on China. But simply cutting off existing suppliers before alternative capacity exists could raise drug costs and trigger shortages that strain hospitals and military medical readiness and leave the supply chain more fragile than before.

Instead, leaders in both industry and government need to build redundancy into pharmaceutical supply chains, so that a disruption involving any one supplier, manufacturing facility, or country doesn’t prevent patients from getting the medicines they need or give China a lever to pull in a crisis.

America’s innovative drug companies are already rapidly expanding their manufacturing capacity and diversifying their supply chains — and have been doing so for years. During the COVID-19 pandemic, companies scaled up vaccine production through investments in domestic facilities and partnerships with manufacturers around the world. In 2025, the industry’s leading companies announced $500 billion in new U.S. manufacturing and infrastructure investments.

Generic drug manufacturers, by contrast, face a different economic reality. Intense price competition and thin margins make it much harder for these companies to invest in additional production capacity, maintain backup suppliers, or move manufacturing to more expensive locations.

Building a single new manufacturing plant can take five to ten years. Fully recreating today’s offshore manufacturing base domestically would require hundreds of billions of dollars in new construction, followed by continuing subsidies to keep many plants economically viable, since the FDA has previously estimated that API production in India can cost 30% to 40% less than in the United States or Europe.

Trying to reshore everything could therefore consume enormous resources, raise drug costs, and still leave hidden vulnerabilities further upstream. In fact, a September 2026 federal notice acknowledged that most of the key starting materials (KSMs) used to manufacture active pharmaceutical ingredients aren’t produced in the United States.

In other words, a medicine that’s “Made in America” — even one manufactured with American-made active pharmaceutical ingredients — won’t necessarily improve national security if its precursor chemicals, specialized equipment, or raw materials still come solely from China.

A better strategy is to expand domestic manufacturing capacity while also helping companies diversify their global supply chains, so that a disruption at any one supplier does not halt production.

That will require reforms that reinvigorate America’s chemical and petrochemical manufacturing industries, help biotech firms cultivate alternative suppliers in trusted partner countries, and ensure that critical medicines can be produced at multiple facilities. For low-margin generic medicines, targeted financial incentives and long-term purchasing commitments may be necessary to make that redundancy economically sustainable.

Simply put, supply-chain resilience does not require pharmaceutical autarky. It merely requires ensuring that no adversary — and no accident or natural disaster at a single factory — can cut Americans off from medicines.

Policy Proposals to Strengthen Pillar 3

Washington can combat genuine supply-chain vulnerabilities and promote reshoring and friendshoring in a financially feasible way.