New “Buy American” Order Mandates Domestic Manufacturing of Essential Drugs

President Donald Trump signed a new executive order requiring that certain “essential” drugs and medical supplies purchased by the federal government be manufactured in the U.S. The administration argues the move will combat the nation’s dependence on foreign drug manufacturing.

Under the new executive order, which has been criticized by the pharmaceutical industry, the FDA will develop a list of “essential” medicines to be covered. Agencies such as the Department of Health and Human Services and the Department of Veterans Affairs will be ordered to purchase these medicines only from U.S. factories.

The rule will, at a minimum, apply to drugs and medical supplies needed to combat emergencies such as pandemics and other national security threats, according to Peter Navarro, PhD, Director of the White House Office of Trade and Manufacturing Policy. The order also will limit some FDA and Environmental Protection Agency regulations to enable domestic manufacturers to meet the increased demand.

The Association for Accessible Medicines (AAM), a lobbying group representing generic drugmakers, said in a statement that it can support elements of the order but is waiting for more details as agencies begin to implement it. The group has requested that the government ensure additional production costs be considered in long-term contracts with manufacturers.

Stephen J. Ubl, President and CEO of PhRMA, the pharmaceutical industry’s trade group, said in a statement that mandating domestic manufacturing would introduce unprecedented disruption to supply chains.

“The ‘Buy American’ executive order could disrupt the global pharmaceutical supply chain, jeopardizing our ability to respond to the current crisis and potentially leading to major long-term supply-chain disruptions, including shortages,” said Mr. Ubl.