Coronavirus in China could threaten U.S. pharmaceutical ingredient sourcing

There is an important and interesting article in today’s STAT which points out that as the coronavirus spreads through China the pharmaceutical industry may be impacted significantly as China now has 13% of all facilities that make ingredients for medicines that are sold in the U.S., according to the Food and Drug Administration.  28% of such facilities are in the U.S. and 26% are in the European Union.

Most ingredient production is concentrated in Zhejiang province, which is something of a manufacturing hub that lies along the East China Sea, far from the city of Wuhan, where the outbreak began, explained a source familiar with the Chinese pharmaceutical market but who asked not to be named.

Roughly 80% of active ingredients used by commercial sources to produce finished medicines come from China,  Christopher Priest, deputy assistant director at the U.S. Defense Health Agency, said in testimony given last July to the U.S.-China Economic and Security Review Commission.

In addition, a growing number of Indian generic makers purchase ingredients from China. In fact, the Indian government is trying to find ways for its domestic industry to become less reliant on Chinese suppliers.

In the U.S., for instance, medicines imported from India account for 40% of all generics used. And roughly 90% of all prescriptions written in the U.S. are for generics. The upshot: An untold amount of ingredients made in China are finding their way to U.S. medicine cabinets.

Jeffrey Newman represents whistleblowers nationwide, including Securities & Exchange whistleblowers. He can be reached at or at 617-823-3217