‘Buy American’ Executive Order Will Worsen Shortages and Raise Costs for Americans

As our country continues to grapple with COVID-19, patient access to affordable health care remains a significant concern. While the Trump administration’s rapid response to this pandemic is appreciated, there is still much to be done to secure needed medications and medical products for Americans. 

The Buy American Act of 1933 requires that items purchased with funds appropriated by Congress must be produced and manufactured in the United States. Medications currently do not apply under the Buy American Act and therefore do not have to follow these guidelines. Recent efforts by certain members of the administration to extend the Buy American Act of 1933 to medications and medical products would be detrimental to American health and safety, especially during a global pandemic. Issuing a Buy American executive order would require that federal agencies purchase only American-made goods, worsening medicine shortages and access to needed treatments. 

Our pharmaceutical industry relies on the current global supply chain to manufacture high-quality medications at affordable costs. Most pharmaceutical products are not wholly manufactured in any single country. The United States simply does not produce the raw materials or products essential to drug development and treatments. While certain medications sold in the United States are made domestically, we rely on manufacturing plants abroad for more complex products. Further, even when made locally, active ingredients for these medications are produced in other countries. We also rely on foreign countries for access to additional medical products. Last year alone, the United States imported $45.6 billion of medical equipment for American use.

Issuing broad mandates on the global medical supply chain through Buy American will undermine American credibility abroad and erode our relationship with our closest allies. It would disrupt current treaty and trade obligations and cause distaste and possibly even retaliation from other countries. This would further contribute to shortages of critical supplies and hurt the competitiveness of important industries in America by restricting fundamental access to foreign markets.

Past proposals to combat drug costs in the United States have not prioritized free-market competition and the need for innovative cures and treatments. With the exponential growth and rapid spread of COVID-19, Americans lack vital care and access to necessary medications. Implementing a Buy American executive order will further dismantle our pharmaceutical industry. It could take up to 10 years and billions of dollars to build new facilities, secure needed supplies and comply with regulations. Requiring that raw materials, medicines and vaccines purchased by the Department of Health and Human Services, the Department of Defense and the Veterans Administration be American-made is simply not feasible under current conditions.

Imposing restrictions on the sourcing of needed materials and medications forces the government into the free market. This will lead to trade wars, high costs and low-quality care. Executing the Buy American order on medical products and materials associated with drug development and treatment will reduce access to needed care and limit our competitiveness. The administration’s intention to better American health care is applauded. However, expanding the Buy American mandates to the biopharmaceutical sector will just exacerbate an already pressing issue — the health of the American people during this time.

Dee Stewart is president of the Center for Innovation and Free Enterprise.

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