US President Joe Biden signed an executive order on Monday, outlining steps to bolster the country’s bio-economy across industries ranging from agriculture and biofuels to medical supplies and bio-pharma manufacturing. The order, titled “Advancing Biotechnology and Biomanufacturing Innovation for a Sustainable, Safe, and Secure American Bioeconomy,” aims to reduce US reliance on foreign materials and bioproduction, as well as the off-shoring of critical industries, to ensure the security of supply for important chemicals and active pharmaceutical ingredients (APIs).
Key Measures
The executive order includes plans to increase Federal investment in R&D areas of biotechnology and biomanufacturing, ensure more resilient supply chains, and encourage the translation of R&D into viable products. While the document highlights US API imports, a 2020 study found that 54% of APIs used in domestic medicines are locally manufactured, with China contributing only 6% in dollar terms. Beyond API manufacturing, China’s growing biotechnology sector is also a focus of the White House.
White House Concerns
During a press briefing, a senior spokesperson noted that the US “has the best biotechnology innovators in the world but is at risk of falling behind, as we did in the semiconductor sector and then the advanced telecommunications sector,” due to aggressive investments by other countries, particularly China.
Upcoming Summit
More details on achieving the goals set out in Biden’s executive order will be revealed on Wednesday, when the White House hosts a Summit on the National Biotechnology and Biomanufacturing Initiative.
Market Reactions
In response, China-based Contract Research and Development Organizations (CDMOs) saw a sharp decline in stock markets. At the time of writing, WuXi Bio (HKG: 2269) was down over 19%, while WuXi AppTech (HKG: 2359) had dropped 15.4%.-Fineline Info & Tech
