America Risks Losing Its Lead in the Biopharma Industry, New Report Warns; ITIF Holds Capitol Hill Briefing Event on March 5
WASHINGTON—America has led the global biopharmaceutical industry in recent decades on measures ranging from the number of new drugs it produces to its share of the world’s value-added production. This success has been due to its large domestic market and an intentional series of policy choices that have spurred biopharmaceutical innovation, including robust intellectual property protections, limits on government drug price setting, and supportive science policies and innovation clusters. But the United States is now second-guessing its successful policy choices and risks neglecting its leadership position in the industry while China is actively aspiring to gain a competitive advantage, according to a new report from the Information Technology and Innovation Foundation (ITIF).
ITIF will hold an expert briefing event to discuss the report on Tuesday, March 5 at 12:00 PM EST. The event will take place at the U.S. Capitol Visitor Center in Washington, DC, and will be livestreamed on ITIF’s website.
“America’s leadership in advanced-technology sectors should never be taken for granted,” said Sandra Barbosu, Senior Policy Manager at ITIF and author of the report. “We have seen this happen before, as the United States has experienced losses in other advanced industries. Absent policies that provide a supportive environment for biopharmaceutical research and innovation, it is likely the U.S. biopharma industry will decline, too, while China will take advantage and advance.”
ITIF’s analysis reviews the factors that led to U.S. declines in five advanced industries—telecommunications equipment, semiconductors, televisions, solar panels, and chemicals—and it explores how those losses can inform U.S. policymakers about the best practices to shore up and maintain U.S. leadership in the biopharmaceutical industry. These lessons are becoming increasingly important as China is implementing increasingly aggressive policies to strengthen its own domestic pharmaceutical industry’s manufacturing and innovation capabilities.
There are many reasons for the loss of U.S. competitiveness in other advanced industries, including mistakes made by companies, but a common thread is that American policymakers took an overly laizzez-faire approach to these industries without providing adequate policy support, such as protecting them from foreign predatory trade practices, recognizing they require scale to compete in global markets, investing in their innovation potential, or supporting them with research and development (R&D) funding.
The report concludes that for the United States to maintain its leadership in biopharmaceuticals, it must continue to make robust federal investments in research and development, restore a strong IP environment, and avoid government drug price setting.
“The United States has a long history of initially leading in advanced industries, only to lose its competitive advantage to other countries with more effective industrial policies and patient private sector capital,” said Barbosu. “Rather than attacking ‘Big Pharma,’ policymakers should heed the lessons of U.S. decline in telecommunications, semiconductors, television, solar panels, and chemicals to bolster the U.S. biopharmaceutical industry’s competitiveness.”
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The Information Technology and Innovation Foundation (ITIF) is an independent, nonprofit, nonpartisan research and educational institute focusing on the intersection of technological innovation and public policy. Recognized by its peers in the think tank community as the global center of excellence for science and technology policy, ITIF’s mission is to formulate and promote policy solutions that accelerate innovation and boost productivity to spur growth, opportunity, and progress.
