Bill Summary
The "Anyone But China Safe Drug Act" (ABC Safe Drug Act) is a proposed piece of legislation aimed at restricting the use of federal funds for purchasing pharmaceutical drugs that contain active ingredients manufactured in the People's Republic of China (PRC). The key provisions of the bill include:
1. **Purchase Restrictions**: Starting January 1, 2028, federal health programs (like those under the Department of Health and Human Services, Department of Veterans Affairs, and Department of Defense) will only be allowed to purchase drugs if at least 60% of their active pharmaceutical ingredients are sourced from countries other than China that meet FDA health and safety standards. By January 1, 2030, this requirement will increase to 100%.
2. **Labeling Requirement**: The bill mandates that drug labeling must specify the country of origin for each active ingredient, enhancing transparency for consumers and healthcare providers.
3. **Waivers**: The Secretary of Health and Human Services has the authority to grant waivers from these requirements for agencies that can demonstrate a specific need, though no waivers will be allowed for purchases made after January 1, 2031.
4. **Tax Incentives**: The legislation also includes provisions for temporary 100% expensing for qualified pharmaceutical and medical device manufacturing property placed in service between 2025 and 2030, encouraging domestic manufacturing of drugs and devices.
Overall, the ABC Safe Drug Act is designed to promote domestic production of pharmaceuticals, reduce reliance on China for drug ingredients, and ensure the safety and quality of medications in the U.S. healthcare system.
Possible Impacts
The "Anyone But China Safe Drug Act" could affect people in several ways. Here are three examples:
1. **Increased Drug Prices**: By banning the use of federal funds for drugs manufactured in China, the legislation may lead to a reduction in competition in the pharmaceutical market. This could result in higher prices for drugs, especially if alternative suppliers from other countries cannot meet the demand or are more expensive. Patients relying on federal health programs may find their out-of-pocket costs increase as a result.
2. **Drug Availability and Access**: The requirement that drugs purchased by federal health programs must have their active ingredients sourced from specific countries, excluding China, could lead to shortages of certain medications. If manufacturers are unable to comply with the new sourcing requirements by the deadlines set in the act, patients may face delays in receiving essential medications or may find that certain drugs are no longer available through federal programs.
3. **Impact on Pharmaceutical Manufacturing Jobs**: The legislation includes provisions for temporary tax incentives for pharmaceutical and medical device manufacturing within the U.S. This could encourage domestic production, potentially leading to job creation in the manufacturing sector. However, it may also result in job losses in companies that currently rely on sourcing ingredients from China, leading to economic uncertainty for workers in those industries. Additionally, the shift in manufacturing could affect the overall job market in regions dependent on foreign manufacturing operations.
[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[S. 1407 Introduced in Senate (IS)]
<DOC>
119th CONGRESS
1st Session
S. 1407
To ban the use of Federal funds for the purchase of drugs manufactured
in the People's Republic of China, and for other purposes.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
April 10, 2025
Mr. Cotton introduced the following bill; which was read twice and
referred to the Committee on Finance
_______________________________________________________________________
A BILL
To ban the use of Federal funds for the purchase of drugs manufactured
in the People's Republic of China, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Anyone But China Safe Drug Act'' or
the ``ABC Safe Drug Act''.
SEC. 2. FEDERAL HEALTH PROGRAM PURCHASE OF DRUGS.
(a) Federal Health Program Purchase of Drugs.--
(1) In general.--Notwithstanding any other provision of
law, with respect to the purchase of a drug by the Department
of Health and Human Services, the Department of Veterans
Affairs, the Department of Defense, or any other Federal health
care program (as defined in section 1128B(f) of the Social
Security Act (42 U.S.C. 1320a-7b(b))), the following shall
apply:
(A) Beginning on January 1, 2028, such agency or
program may purchase only drugs for which 60 percent or
more of the active pharmaceutical ingredients are
manufactured in countries described in paragraph (2).
(B) Beginning on January 1, 2030, such agency or
program may purchase only drugs for which 100 percent
of the active pharmaceutical ingredients are
manufactured in countries described in paragraph (2).
(2) Countries described.--The countries described in this
paragraph are countries--
(A) other than People's Republic of China; and
(B) that meet the health and safety standards of
the Food and Drug Administration.
(3) Waivers.--The Secretary of Health and Human Services
may issue waivers of the requirements under paragraph (1) for
any agency or program that is unable to meet such requirements
and demonstrates a need for the waiver. No waiver may be issued
under this paragraph for drugs that are purchased on or after
January 1, 2031.
(b) Labeling Requirement.--Section 502 of the Federal Food, Drug,
and Cosmetic Act (21 U.S.C. 352) is amended by adding at the end the
following:
``(hh) If it is a drug and its labeling does not specify the
country of origin of each active ingredient contained in the drug.''.
SEC. 3. TEMPORARY 100 PERCENT EXPENSING FOR PHARMACEUTICAL AND MEDICAL
DEVICE MANUFACTURING PROPERTY.
(a) In General.--For purposes of section 168(k) of the Internal
Revenue Code of 1986, in the case of any qualified pharmaceutical and
medical device manufacturing property which is placed in service after
December 31, 2024, and before January 1, 2031--
(1) such property shall be treated as a qualified property
(within the meaning of such section);
(2) the applicable percentage otherwise determined under
section 168(k)(6) of such Code with respect to such property
shall be 100 percent; and
(3) paragraph (8) of such section shall not apply.
(b) Qualified Pharmaceutical and Medical Device Manufacturing
Property.--For purposes of this section, the term ``qualified
pharmaceutical and medical device manufacturing property'' means any
tangible property placed in service in the United States as part of the
construction or expansion of property for the manufacture of drugs (as
defined in section 201(g) of the Federal Food, Drug, and Cosmetic Act
(21 U.S.C. 321(g)) or devices (as defined in section 201(h) of such Act
(21 U.S.C. 321(h)))).
(c) Termination.--This section shall not apply to any property
placed in service after December 31, 2030.
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