US needs to shore up medical device manufacturing
Among the many lessons learned from the COVID-19 pandemic was that adequate access to medical supplies is critical to individual, community and national well-being. But we could soon find ourselves relying on foreign countries with conflicting interests to ours for essential medical devices. Not only does that threaten jobs and investment, but it makes the U.S. vulnerable in times of crisis, ultimately threatening our national security.
Look at the manufacture of syringes and needles. This year, two of the three major domestic manufacturers of syringes and needles closed their plants and are now sourcing these products exclusively from manufacturers in China, which is rapidly becoming the world’s leading exporter of syringes in 2021, according to a recent report by the Mercator Institute for China Studies. This leaves the U.S. with only one major domestic manufacturer of syringes and needles, and it has already consolidated production from three sites to two.
The recently created White House Council on Supply Chain Resilience is the Biden administration’s latest effort to ensure access to essential medicines and to prevent drug shortages. It goes up against China’s extensive government subsidies and industrial policies that allow it to dominate global medical device manufacturing in pricing, product categories and sophistication. Despite geopolitical tensions, Chinese imports of industry-relevant products have doubled over the last five years, according to IBISWorld.
But our increasing reliance on these imported devices is harming Americans. In November 2023 alone, the FDA announced two Class I recalls — the most serious type of recall — related to syringes sourced from China. In one incident, the FDA found that some syringes manufactured by Cardinal Health could cause overdose, underdose and device performance issues due to their incompatible dimensions with infusion pumps. In the other, leakage issues were found in syringes manufactured for Fresenius Medical Care that could lead to blood loss, infection, embolism or death.
The agency advised avoiding Chinesemade plastic syringes pending further FDA actions, which may include an import ban.
Concern over the quality and safety of Chinese-made needles isn’t new. In May 2021, the FDA issued a letter to health care providers warning of the risk that certain needles could get stuck in patients or accidentally puncture users. Part of the problem is that foreign facilities are difficult for the overstretched Food and Drug Administration (FDA) to inspect. In 2022, according to data from the FDA, the agency inspected zero medical device facilities in China, but more than 1,000 facilities in the U.S.
Investing in domestic manufacturing capacity is key to President Biden’s new supply chain strategy. In the case of medical supply chains, the erosion of America’s medical device industry is a growing crisis, on par with other areas of strategic concern, and one that Washington must urgently address.
For far too long, medical device purchasing has been driven by a price-centric race to the bottom that incentivized manufacturing in China. This erosion risks not only the loss of manufacturing capacities in the U.S., but also the loss of technical expertise and human capital — diminishing our lead in medical device innovation and our ability to rapidly scale up production during crises such as pandemics or geopolitical tensions.
Learning the lessons of the COVID19 response, and recognizing the strategic significance of a strong domestic medical device manufacturing base, U.S. medical supply chain policies must focus on leveling the playing field for domestic manufacturers.
The U.S. government has a historic opportunity to reform trade and medical payment policies, such as the “Made in America” incentives administered by the Centers for Medicare and Medicaid Services (CMS) that support health care providers’ decisions to purchase U.S.-made products. Buy American programs and potential tariffs were also ratified and supported in the recent bi-partisan report of the House Select Committee on the CCP issued on Dec. 12th.
Through these efforts, the Biden administration can meet the goals of securing resilient access to critical medical devices while supporting one of the country’s most innovative and vital industries.