A bipartisan group of US senators on Wednesday, 16 July introduced sweeping legislation to tighten oversight of foreign ownership in America's pharmaceutical industry, citing deepening dependence on China for critical medicines and drug ingredients as a threat to national security and public health. The proposed Pharmaceutical Investment Oversight and Accountability Act would mandate annual reports to Congress on foreign investment in pharmaceutical manufacturing and related technologies.

What the Legislation Proposes

The bill was introduced by Senate Special Committee on Aging Chairman Rick Scott, alongside Ranking Member Kirsten Gillibrand and Senator Elizabeth Warren. If enacted, it would require systematic disclosure of who ultimately owns or controls companies supplying medicines to American consumers — including facilities that manufacture drugs, produce active pharmaceutical ingredients (APIs), or hold sensitive clinical data.

'The American people, and especially seniors, deserve to know who actually controls the medicines keeping them alive,' Scott said while opening the committee hearing. He argued that Washington currently lacks a complete picture of foreign ownership across the pharmaceutical supply chain, and that geopolitical tensions could expose dangerous vulnerabilities if critical supplies were disrupted.

India and China Named in Testimony

Gillibrand acknowledged that the United States remains heavily dependent on both China and India for key starting materials and APIs used to manufacture many generic medicines. She called for stronger oversight to understand the extent of foreign influence, while stressing that trusted international investment should continue. 'We must bolster federal oversight efforts and increase transparency on how foreign capital impacts American health care infrastructure,' she said.

Several expert witnesses told the committee that China has expanded its pharmaceutical footprint well beyond generic drug manufacturing into biotechnology research, clinical trials, and pharmaceutical innovation — raising concerns about long-term US competitiveness and supply chain resilience.

Expert Witnesses Urge Tougher Rules

Former Commerce Department official Nazak Nikakhtar urged Congress to tighten oversight of Chinese investments in US biotechnology companies, arguing that existing laws leave significant gaps — allowing certain investments, licensing arrangements, and data-sharing agreements to escape government review.

Stephen Ezell, vice president at the Information Technology and Innovation Foundation, said China has leveraged industrial subsidies, aggressive pricing, and strategic acquisitions to build a dominant position across the pharmaceutical value chain. He called for stronger disclosure rules requiring companies in strategic sectors to identify their beneficial ownership and any foreign control.

Rush Doshi, director of the China Strategy Initiative at the Council on Foreign Relations, said the United States had grown increasingly reliant on Chinese suppliers for upstream pharmaceutical inputs used in hundreds of medicines. He urged Washington to diversify production, strengthen domestic manufacturing, and deepen cooperation with allied nations.

India as a Strategic Alternative

Notably, Ezell singled out India as a potential partner in reducing US dependence on China's pharmaceutical dominance. He suggested that pharmaceutical cooperation should be embedded in the broader US-India strategic partnership — alongside existing collaboration in semiconductors, artificial intelligence, and critical minerals. He also proposed that the US Development Finance Corporation could support pharmaceutical manufacturing in India through loan guarantees and other financing tools.

This comes amid a broader Washington push to de-risk supply chains across multiple strategic sectors, and the hearing signals that pharmaceuticals are now firmly on that list. Whether the bill advances through a divided Congress remains to be seen, but the bipartisan backing from senators spanning the ideological spectrum suggests unusual political momentum.