Sponsors
The bill trades stronger domestic supply chains, greater labeling transparency, and near-term incentives for U.S. manufacturing against higher short-term costs, potential drug shortages, procurement complications, and lost federal revenue.
Patients (including veterans and federal beneficiaries) and the U.S. drug supply chain will see increased domestic and allied-country API production and stronger supply-chain resilience through procurement and investment incentives.
Federal patients (VA, DOD, Medicare/Medicaid beneficiaries) and other consumers will get clearer information about where active pharmaceutical ingredients come from and may be less exposed to substandard ingredients because labels must list API country-of-origin and purchases can be limited to countries meeting FDA standards.
Manufacturers and small-business owners will face lower after-tax costs for eligible projects in 2025–2030, encouraging immediate investment and likely speeding job creation in U.S. drug and device manufacturing and construction.
Federal programs and patients (Medicare/Medicaid beneficiaries, veterans) could face higher drug costs if U.S./allied API supply is limited or manufacturers pass through added compliance and labeling costs.
Patients (including those with chronic conditions and veterans) risk delays or shortages of necessary medicines if alternative API producers cannot meet demand by the law's deadlines.
Taxpayers could face reduced federal revenue from the expanded 100% bonus depreciation, increasing deficits or crowding out other spending priorities.
Based on analysis of 3 sections of legislative text.
Directs federal health programs to buy drugs with APIs increasingly made outside China (60% by 2028, 100% by 2030), adds API country-of-origin labels, and grants temporary bonus depreciation for U.S. drug/device plants.
Introduced April 10, 2025 by Thomas Bryant Cotton · Last progress April 10, 2025
Requires federal health programs (including HHS, VA, DoD, and other federally defined health programs) to buy drugs whose active pharmaceutical ingredients (APIs) are increasingly manufactured outside the People’s Republic of China: at least 60% non-China by Jan 1, 2028, and 100% non-China by Jan 1, 2030, with a limited waiver process that ends for purchases on or after Jan 1, 2031. Adds a requirement that drug labeling disclose the country of origin for each active ingredient. Provides a temporary tax incentive to spur U.S. manufacturing: qualified pharmaceutical and medical device manufacturing property placed in service in the United States after Dec 31, 2024 and before Jan 1, 2031 is eligible for 100% bonus depreciation, with the new rule expiring for property placed in service after Dec 31, 2030.