Following the Biden administration’s report about supply chain vulnerabilities in the wake of COVID-19, it is critical the United States embrace market dynamics, trade agreements and international cooperation to strengthen the economy and bolster against future disruptions.

In a new white paper, R Street trade experts Bill Watson and Clark Packard offer recommendations for new trade rules that will foster more open trade with reliable partners and build resilient supply chains.

“Policymakers should double-down on existing trading relationships and create new trade partnerships with close allies rather than trying to reshore production of all products deemed ‘strategic’—including, but not limited to pharmaceuticals and active pharmaceutical ingredients,” said Bill Watson, associate fellow, and Clark Packard, trade policy counsel and resident fellow at the R Street Institute. “True resilience and security will not come from autarky, but rather through diversification.”

The Covid-19 pandemic has demonstrated how effective globalized, market-driven supply chains have been in addressing the crisis. Restricting trade and requiring the United States to produce pharmaceutical products at home would limit our drug supply and make it more vulnerable, as evidenced by some pandemic-related interventions domestically and around the globe.

Going forward, the United States should negotiate new trade rules that foster resilient supply chains for medicines, renew the Trade Promotion Authority and pursue a Secure Supply Chain Agreement with reliable partners to eliminate import barriers, export restrictions and procurement preferences for pharmaceutical products and their ingredients while promoting regulatory harmonization and cooperation.

Read the paper here.