RealClearDefense: The Wrong Way To Compete With China in Biotech

During my two decades at the CIA, I watched the Chinese Communist Party methodically transform strategic industries, recognizing that a strong industrial base drives national security. Nowhere is that more consequential than biotechnology.

Beijing has spent years subsidizing its domestic biotech sector, and the results are no longer hypothetical. China's share of global drug development has grown from roughly 8 percent to more than 30 percent over the past decade, while the U.S. share has fallen from 48 percent to 37 percent. 

These are not vanity metrics. They reflect a deliberate, state-directed strategy to capture one of the world's most strategically important industries for economic power and geopolitical advantage. 

Washington's response should bolster American security by strengthening American innovation leadership. Thus far, Washington has favored broad restrictions that look tough on China by walling off American capital and access rather than strengthening America's capacity to discover new medicines.

The impulse is understandable. But protectionist policies that overlook downstream consequences and in reality do little to slow China while weakening American competitiveness, are not a national security strategy.

We have seen how this story ends. Beginning in 2012, the United States responded to subsidized Chinese solar panels with tariffs that eventually reached 250 percent, citing both economic and national security concerns. China's share of the global market did not fall. It grew. Manufacturers routed production through Vietnam, Malaysia and Thailand to get around the duties, American prices climbed more than 20 percent relative to other markets, and domestic manufacturing never scaled to fill the gap.  

If solar illustrates the economic cost of this approach, shipbuilding reveals the strategic one. The Jones Act of 1920 reserved domestic shipping for American-built, American-crewed ships. Protection came. Investment never did. China now accounts for more than half of global commercial shipbuilding. By the Navy’s own assessment, its shipbuilding capacity is more than 200 times America’s. In 2024, China built more than 1,000 commercial vessels. We built eight. Worse, the loss strengthened a rival’s fleet.

Now apply that lesson to medicine, where losing is measured in lives. We already depend on China for a dominant share of the active pharmaceutical ingredients that finished generic drugs cannot exist without, and for certain categories, American manufacturers have no current realistic domestic alternative. A sudden retreat behind new barriers without first securing a domestic supply or ensuring long term domestic investment would only deepen that dependence. A country that cannot secure essential medicines has surrendered a critical element of national readiness.

At this year's meeting of the American Society of Clinical Oncology, a cancer therapy developed by a Chinese biotechnology company earned a coveted spot in the conference's Plenary Session, the first China-originated drug to do so. The medicine is now under FDA review -- a reminder that China is no longer simply manufacturing medicines. It is increasingly discovering them.

By one major bank's estimate, drugs originating in China could account for more than one-third of FDA approvals by 2040, up from 5 percent today. 

Washington can respond in one of two ways: wall off investment and access or ask why China is gaining ground in one of America's most strategically important industries -- and what we must do to stay ahead.

Making China weaker is not the same as making America stronger. Only the latter improves American preparedness, readiness, and security. 

The more urgent problem is what Washington is doing to itself. The White House has proposed cutting the National Institutes of Health, the upstream source of the discoveries that become approved drugs, by roughly 40 percent. We are making it harder to keep the world's best scientists. Federal regulation has failed to keep pace with the science, so early-phase clinical trials that should take months now take years. Each is a self-inflicted wound. 

America will not outcompete China by imitating its model, nor does it need to. Our advantage has always been different: a market-driven system, entrepreneurial spirit, best-in-class science, and a network of trusted allies.

Washington should build on those strengths and make biotech a national security priority. Fund the basic research now on the chopping block. Modernize the FDA so discoveries reach patients in months rather than years. Secure pharmaceutical supply chains through domestic production and allied partnerships. Treat the recruitment of scientific talent as a priority. Better coordinate the FDA, NIH, Treasury, Defense Department, and intelligence community around a coherent biotechnology strategy. 

The United States will not counter the threat from China by building higher walls around an already weakened industry. It will do so by strengthening the foundations of American scientific leadership before the window to do so narrows further.