Editorial: Drug supply chain a national-security concern

By all indications the pharmaceutical industry won t be spared from tariffs In April the Commerce Department took its first step toward imposing levies on drug imports The goal according to the White House is to encourage companies to manufacture in the U S Yet tariffs are unlikely to increase American self-sufficiency anytime soon Far worse such an approach could drive prices higher for patients and lead to shortages of lifesaving medications In its announcement the Commerce Department declared that a so-called Section examination is underway for the drug industry The provision part of the Transaction Expansion Act of aims to determine whether an overreliance on imports presents a national-security threat Such investigations are a precursor to imposing tariffs and could take up to nine months to complete Available evidence appear to help what should be an obvious conclusion The U S is highly reliant on drug imports According to a large database of population and proprietary records of the top brand-name drugs sold in the U S are manufactured abroad The U S imported more than billion worth of medications last year President Trump on Monday addressed the runaway cost of drugs with an executive order calling on drug companies to lower costs If they don t Strength Secretary Robert F Kennedy Jr will get the job to develop new rules that tie U S costs to the lowest prices paid in other countries Exactly how that works remains to be seen without action from Congress Nor is it clear how the tariff inquiry and executive order may be linked Whether U S reliance on drug imports is a national-security threat is another matter Pharmaceutical supply chains started winding their way around the globe in the s in search of cheaper labor and materials less encumbered construction and lower taxes The aftermath has been a boon for patients who ve gotten less expensive medications Wider use of statins for example has dramatically reduced the liability of cardiovascular ailment the world s leading cause of death Rerouting production through the U S threatens to reverse this progress Branded prescriptions could become prohibitively expensive and particular lower-margin generic drugs which comprise more than of medications might cease production altogether Reforms that ease domestic outlay and production may be helpful For instance regulators require manufacturers to submit meticulous records of product improvement These files can take years to compile cost millions of dollars and run to tens of thousands of pages White House proposals to streamline this process are a step in the right direction Ultimately though such efforts should reinforce a global supply chain not replace it Key U S allies such as India and Ireland have built up areas of expertise over decades including generics manufacturing and R D that have unambiguously benefited U S patients These relationships should be strengthened China shouldn t be excluded If as bureaucrats have signaled it s willing to engage with the U S in transaction talks drug inputs should be among the first products exempted from obstructions At this stage it s unclear exactly how the Commerce Department will impose these added tariffs Protecting access to critical medicines should rank among the nation s preponderance significant national-security goals Allowing economic forces to run their class as history suggests is the best way to keep the nation healthy Bloomberg Opinion