WASHINGTON — In 2004, when Bristol-Myers Squibb said it would close its factory in East Syracuse, N.Y. — the last plant in the United States to
manufacture the key ingredients for crucial antibiotics like penicillin — few people worried about the consequences for national security.
“The focus at the time was primarily
on job losses in Syracuse,”
said Rebecca Goldsmith, a company spokeswoman. {B.S. the purpose was more profits--jk}
But now experts and lawmakers are growing
more and more concerned that the nation is far too reliant on medicine from abroad, and they are calling for a law that would
require that certain drugs be made or stockpiled in the United States.
“The lack of regulation around outsourcing is a blind
spot that leaves room for supply disruptions, counterfeit medicines, even bioterrorism,” said Senator Sherrod Brown,
Democrat of Ohio, who has held hearings on the issue.
Decades ago, most pills consumed in the
United States were made here. But like other manufacturing
operations, drug plants have been moving to Asia because labor, construction, regulatory and environmental
costs are lower there.
The critical ingredients for most antibiotics
are now made almost exclusively in China and
India. The same is true
for dozens of other crucial medicines, including the popular allergy medicine prednisone; metformin, for diabetes; and amlodipine, for high blood pressure.
Of the 1,154 pharmaceutical plants mentioned in generic
drug applications to the Food and Drug Administration in 2007, only 13 percent were in the
United States. Forty-three percent were in China, and
39 percent were in India.
Some of these medicines are lifesaving,
and health care in the United States depends on them. Half
of all Americans take a prescription medicine every day.
Penicillin, a crucial building block for two classes of
antibiotics, tells the story of the shifting pharmaceutical marketplace. Industrial-scale production of penicillin was developed
by an American military research group in World War II, and nearly every major drug manufacturer once made it in plants scattered
throughout the country.
But beginning in the 1980s, the Chinese government invested
huge sums in penicillin fermenters, “disrupting prices around the globe and forcing most Western producers from the
market,” said Enrico Polastro, a Belgian drug industry consultant who is an expert in antibiotics. {Chinese economic success has been predicated upon state capitalism, of which 40% of manufacturing is owned
by the state and local governments—jk}.
Part of the reason these plants went overseas
is that the F.D.A. inspects domestic plants far more often than foreign ones, making production more expensive in the United
States. {What about the 27 cents per
hour the average Indian makes?--jk}
“U.S. companies
are more regulated and are under more scrutiny than foreign producers, particularly those from emerging countries. And that’s
just totally backwards,” said Joe Acker, president of the Synthetic Organic Chemical Manufacturers Association. “We
need a level playing field.”
The Bush administration spent more than $50 billion after
the 2001 anthrax attacks to protect the country from bioterrorism attacks and flu pandemics; some of that money went to increase domestic manufacturing capacity for flu vaccines.
Even so, officials have said that during
a pandemic the United States would not be able to
rely on vaccines manufactured largely in Europe because of possible border closures and supply
shortages. And the situation is similar with antibiotics like penicillin; researchers have found that during the 1918 flu
pandemic, most victims died of bacterial infections, not viral ones.
The Centers for Disease Control and Prevention has a stockpile of medicines with enough antibiotics to treat 40 million people. If more are needed,
however, the nation lacks the plants to produce them. A penicillin fermenter would take two years to build from scratch, Mr.
Polastro said.
Dr. Yusuf K. Hamied, chairman of Cipla,
one of the world’s most important suppliers of pharmaceutical ingredients, says his company and others have grown increasingly
dependent on Chinese suppliers. “If tomorrow China stopped
supplying pharmaceutical ingredients, the worldwide pharmaceutical industry would collapse,” he said.
Since drug makers often view their supply chains as trade
secrets, the true source of a drug’s ingredients can be difficult or impossible to discover. The F.D.A. has a public
listing of drug suppliers, called drug master files. But the
listing is neither up to date nor entirely reliable, because drug makers are not required to disclose supplier information.
One federal database lists nearly 3,000
overseas drug plants that export to the United States; the
other lists 6,800 plants. Nobody knows which is right.
Drug labels
often claim that the pills are manufactured in the United States, but the
listed plants are often the sites where foreign-made drug powders are pounded into pills and packaged.
“Pharmaceutical companies do not like to reveal where
their sources are,” for fear that competitors will steal their suppliers, Mr. Polastro said. {More B.S.—jk}
China’s
position as the pre-eminent supplier of medicines is a result of government policy, said Guy Villax, the chief executive of
Hovione, a maker of crucial drug ingredients with plants in Portugal and
China.
The regional government in Shanghai has
promised to pay local drug makers about $15,000 for any drug approval they garner from the F.D.A. and about $5,000 for any
approval from European regulators, according to a document Mr. Villax provided.
“This shows that there has been a
government plan in China to become a pharmaceutical industry leader,”
Mr. Villax said.
The world’s growing dependence on Chinese drug manufacturers
became apparent in the heparin scare. A year ago, Baxter International and APP Pharmaceuticals split the domestic market for heparin, an anticlotting drug needed for surgery
and dialysis.
When federal drug regulators discovered
that Baxter’s product had been contaminated by Chinese suppliers, the F.D.A. banned Baxter’s product and turned
almost exclusively to the one from APP. But APP also got its product from China.
So for now, like it or not, China has
the upper hand. As Mr. Polastro put it, “If China ever got very upset with President Obama, it could be a big problem.”