COVID-19: China Medical Supply Chains and Broader Trade Issues

"The outbreak of Coronavirus Disease 2019 (COVID-19), first in China, and then globally, including in the United States, is drawing attention to the ways in which the U.S. economy depends on manufacturing and supply chains based in China. This report aims to assess current developments and identify immediate and longer range China trade issues for Congress.

An area of particular concern to Congress is U.S. shortages in medical supplies— including personal protective equipment (PPE) and pharmaceuticals—as the United States steps up efforts to contain COVID-19 with limited domestic stockpiles and insufficient U.S. industrial capacity. Because of China’s role as a global supplier of PPE, medical devices, antibiotics, and active pharmaceutical ingredients, reduced export from China have led to shortages of critical medical supplies in the United States. Exacerbating the situation, in early February 2020, the Chinese government nationalized control of the production and distribution of medical supplies in China—directing all production for domestic use—and directed the bureaucracy and Chinese industry to secure supplies from the global market. Now apparently past the peak of its COVID-19 outbreak, the Chinese government may selectively release some medical supplies for overseas delivery, with designated countries selected, according to political calculations.

Congress has enacted legislation to better understand and address U.S. medical supply chain dependencies, including P.L. 116-136, The Coronavirus Aid, Relief, and Economic Security (CARES) Act, that includes several provisions to  expand drug shortage reporting requirements;

 require certain drug manufacturers to draw up risk management plans;
 require the U.S. Food and Drug Administration (FDA) to maintain a public list of medical devices that are determined to be in shortage; and
 direct the National Academies of Science, Engineering, and Medicine to conduct a study of pharmaceutical supply chain security..."
COVID-19 and medical supplies