FiercePharmaPolitics—Trump trade adviser, citing 'broken system,' calls for more drug manufacturing in Puerto Rico

Puerto Rico Earthquake
A top adviser for Trump is calling for more drug manufacturing in Puerto Rico. (AP Photo/Carlos Giusti via Newscred)

Welcome to the FiercePharma political roundup, where each Monday we’ll highlight developments in Washington, D.C., and elsewhere that could affect drug pricing and how drugmakers operate.

The COVID-19 pandemic has underscored key weaknesses in the biopharma industry’s complex global supply chain, and now a top adviser for the Trump administration is calling on Congress to push for more manufacturing in Puerto Rico.

In an interview with the Washington Examiner, White House trade adviser Peter Navarro faulted a “broken system” that pushes manufacturing offshore. He called on Congress to use the next round of COVID-19 relief to incentivize manufacturing on the island territory.

Previously, a tax provision allowed U.S. companies to avoid paying federal taxes on profits from operations in Puerto Rico, but Congress phased that out over time, the Examiner reports. Plus, utility costs are significantly higher there than in the U.S., which has also led to a reduction in manufacturing. Pharma companies themselves have shuttered a number of drug plants in Puerto Rico in recent years.

“If this crisis has taught us anything across party lines, it is that we do indeed need to bring home the pharmaceutical supply chain, that it is not just a public health issue, but a national security issue and an economic security issue,” Navarro told the publication.

RELATED: Trump picks little-known U.S. firm to spearhead $354M pandemic drug pact

The Trump administration has already made moves to bolster U.S. drug production in its response to the pandemic. The administration picked a little-known startup, Phlow Corporation, for a $354 million contract to produce generic meds and active pharmaceutical ingredients for COVID-19 therapies. And Monday, the government inked a $628 million deal with Maryland biotech Emergent BioSolutions for potential COVID-19 vaccine manufacturing.

Aside from the administration’s efforts, lawmakers are working on their own measures to bring drug production back to the U.S., Stat reports. That’s caused pharma companies to mobilize lobbyists to push back.  

Meanwhile, a first-term Democratic senator from Arizona has emerged as a favorite for pharma’s political campaign giving, Kaiser Health News reports. Sen. Kyrsten Sinema has received $98,500 in pharmaceutical campaign funds for the 2019-20 election cycle, even though she’s not up for reelection for several years, KHN reported. One expert sees it as a “long-term play” the industry is making in hopes of cultivating a Democratic ally.

Back in February, Sinema formed a congressional caucus to explore "personalized medicine," KHN reports, and, soon after, employees at Amgen, Genentech, Merck, Sanofi, Pfizer and Eli Lilly gave thousands of dollars to her campaign committee.