The Biotech Race — How China is Winning & What Congress Must Do Now

This week on The Big 3, Mihir Torsekar is joined by Caitlin Frazer, Executive Director of the National Security Commission on Emerging Biotechnology, to discuss one of the most important—and least understood—strategic competitions facing the United States.

The conversation begins by explaining why biotechnology is no longer just a healthcare issue. While most Americans associate biotech with new medicines and cancer treatments, biotechnology is rapidly becoming a foundational technology with applications across agriculture, defense, critical minerals, advanced materials, energy production, and manufacturing. As Frazer explains, roughly 60% of today’s supply chain inputs could eventually be produced using biology, making leadership in biotechnology a matter of economic and national security.

The discussion then turns to China’s deliberate strategy to dominate the sector. For years, China specialized in manufacturing pharmaceuticals developed elsewhere. Today, however, Chinese firms are increasingly leading in early-stage drug discovery itself. American pharmaceutical companies are now signing tens of billions of dollars in licensing agreements with Chinese biotech firms, effectively paying for intellectual property that was developed overseas. Those investments risk accelerating China’s innovation ecosystem while weakening America’s own.

Frazer also explains that China’s advantage is not based solely on intellectual property theft. Beijing has spent decades reforming regulations, investing in research infrastructure, cultivating scientific talent, and directing government-backed capital into biotechnology. The result is a rapidly growing innovation engine that increasingly competes head-to-head with American firms.

The interview explores the national security implications of this shift, including China’s military-civil fusion strategy, dependence on Chinese pharmaceutical supply chains, biological data security, and the possibility that future medical breakthroughs could become geopolitical leverage.

Finally, the conversation highlights areas where Congress has already begun responding. The National Security Commission on Emerging Biotechnology issued 49 recommendations in 2025, with roughly three-quarters now advancing through legislation or executive action. Frazer argues that while America still retains critical advantages, the window for maintaining leadership is narrowing. She points to the National Biotechnology Initiative Act and stronger biological data protections as among the most important next steps.

The central message is clear: America still has time to preserve its leadership in biotechnology—but waiting much longer could make rebuilding that advantage far more difficult and expensive.



CHAPTERS:

00:00 – Introduction
04:41 – Why Biotech Has Become a National Security Race—and How China Is Closing the Gap
13:23 – Why American Drug Companies Are Funding Chinese Innovation—and What It Means for U.S. Leadership
22:51 – How Congress Can Still Preserve America’s Biotech Advantage—Before the Window Closes
39:10 – Closing Remarks

Transcript

SPEAKER_00 0:04

This is the victory from the Coalition for a Prosperous America with senior economist Makir Torskar and Andrew Reschinberg.

SPEAKER_02 0:15

When an American drug company launches a new medicine, there's a rising chance the molecule behind it didn't come from an American lab. In 2022, about 5% of the big licensing deals in the pharmaceutical industry, the ones $50 million or more, went to Chinese firms. By the first quarter of last year was 42%. For decades, China's job in this business was to manufacture, not to invent. They made generic copies of drugs that American and European companies had already developed, and they supplied the raw ingredients that went into other countries' medicines. The inventing, like the brand new drugs, the first treatment of its kind for a disease, that happened in labs here and in Europe. But that era is over. China isn't following anymore, and in some areas they're ahead. And the old worry was that China would steal what we invent, and that's still a real concern, but there's a newer one. And that's American drug companies that are now paying Chinese labs billions of dollars for their discoveries. We're effectively funding our own competition. And our guest today helps explain how we got here. Welcome to the Big Three from the Coalition for a Prosperous America, where each week we break down the three biggest stories shaping US trade, industrial policy, and the American economy. I'm Mihir Torsigar. Andrew is out today, so let's get to it. So today we're joined by Caitlin Frazier, the Executive Director of the National Security Commission on Emerging Biotechnology, a bio a bipartisan commission chaired by Senator Todd Young. They published a comprehensive report and action plan in April of last year. Eight months later in December, Caitlin's team followed with a paper on US China competition and biotech that puts numbers on the issue. How much American money is going to Chinese labs and what it's buying. Caitlin, thank you for joining us on the show.

SPEAKER_01 2:00

Great to be here. Thanks for having me.

SPEAKER_02 2:02

So let's let's start at the beginning, real quick. If you could just talk this through a little bit about the commission itself, why Congress convened it, and what it was actually set up to do.

SPEAKER_01 2:11

Of course. So Congress actually created this commission in law about three and a half, four years ago now. And they did so in anticipation of the need to legislate at the intersection of biotechnology, national security, and economic prosperity. And Congress has a practice of doing this from time to time. We're actually the third in a series of emerging technology-focused groups like ours. First, the first project was cybersecurity, then AI, now biotech. And I think the, you know, Congress does this in recognition of the need to reach for a deep bench of experts to help advise them on a bipartisan basis about what to do about a complicated technological and geopolitical problem set. Our chairman, as you said, is Senator Todd Young. Our vice chair is Dr. Michelle Rozo, who has a long career in and out of government, including at the National Security Council. And then my nine other bosses, our commissioners, are a cross-section of folks who represent leaders in academia, industry, former government officials, and much more. And again, I just really want to emphasize that this is a bipartisan, a group that was appointed on a bipartisan basis. So for about a year and a half, our job was to meet with thousands of stakeholders, both here in the United States and globally, to understand the policy issues at play for modern biotechnology and its applications for national security and its resonance for national security. As you said, we published our action plan for Congress in April of last year. And I'm happy to talk about the findings. But what it really boiled down to was that the United States has had a historic lead in modern biotechnology. I keep saying modern because biotech is actually millennia old. But modern biotechnology is really, in many ways, an American invention. But it has not been because of a dedicated US government strategy to secure and advance that lead. It has been because of the strength of our capital markets, the strength of our research institutions, our human capital and our talent programs, and just our innovative and entrepreneurial spirit. Those are the things that have led or have translated to American leadership in biotech. By contrast, the Chinese government, the CCP, has had a strategy for the last 20 years to dominate emerging biotechnology. And some of the dynamics that you described in your opener are the results of that strategy. So our project was about an answer to that dynamic. How do we retain and in some cases regain that historic leadership edge that the United States has enjoyed in this critical technology field?

SPEAKER_02 4:56

Yeah, that's great. And I think, you know, in just keeping in the spirit of the big three of this show, we've got kind of three broad topics that we're going to break the show down into. So up starting up front, talking about why this is a national security issue. And I want to start broad here because when listeners think of biotech, they think about it as a health, as a health story, like drug prices or new cancer treatments. You know, if you could make the case for why this is a national security issue, um, and we can start there.

SPEAKER_01 5:22

Yeah, absolutely. So, you know, I think most Americans' appreciation for biotechnology as mostly a healthcare medical technology that runs in their medicine cabinet. That's kind of where I started. Uh, you know, my my background is as a congressional staffer, um, State Department, uh, early in my career. And so I kind of brought the national security lens to this. And I did not appreciate the breadth of impact that emerging biotechnology has across economic sectors and for our national security. So I was in exactly the same headspace when I when I started this project about three and a half years ago. But biotechnology is much bigger than medicines. Um, we use farmers and growers use biotechnology in our agriculture sector already, and that's poised to grow with some new uh advancements in in biotechnology products. Um, we can use biotechnology to make fuel, to make chemicals, to make uh polymers and plastics, to make materials. We can actually even use it to extract critical minerals. Um, we can use it for uh for uh waste remediation, for environmental cleanup. And what that means, actually, it kind of I think the statistic that stands out to me is is from a McKinsey study that's several years old now. So probably this number is even higher. But they said in 2021, I believe, that 60% of the inputs to our supply chains, the things we make and use every single day, can be made with biology. And that wasn't some like, you know, science fiction, maybe 50 years from now kind of assessment. It was a look at, I think, about 300 case studies where we already know that the science is possible. And that translates to 60% of the inputs to our supply chain. So then we can so we can think about it from a supply chain resilience perspective, basically the ability to make things that we need across economic sectors. We can also think about it in more of a narrow defense, you know, traditional sort of national security and defense context. And what we're actually seeing is that the Department of War, Department of Defense is embracing biotechnology increasingly as a general purpose technology that advances military, conventional military capabilities. So you can think about military medicine, trauma care, you can think about military logistics and uh even surveillance and reconnaissance and kind of fusing that biological information into the way that we understand the battle space. And for me, all of that translates to yes, of course, the leading edge of biotechnology has traditionally been in the pharmaceutical sector. But where that goes in terms of American leadership, all of this other potential follows.

SPEAKER_02 8:14

Yeah, and I think you really made a really great case as to why this is such a strategic industry and not just like a health industry. And I think strategic industries, one thing we know about China and their strategy is that they've been like deliberate about, you know, over the past 20 plus years taking what became what started small but eventually became dominant positions in steel and solar, rare earth, semiconductors. And this just seems another, you know, part of that playbook, the biotech space. And so a little over a year, I think before your April 2025 report, the commission it seems still believed that the US was ahead of China in in this sector. And the April report concluded that we're falling behind in in a couple of key areas. So, what changed that assessment and and where specifically do you think that we're behind?

SPEAKER_01 8:57

Sure. I think it really boils down to that dynamic that you were talking about of one where, you know, we have understood China's role in the biotech space as one of fast follow. Um, you know, the ability to very quickly scale up and manufacture innovations that were generated somewhere else, either here in the United States or, you know, in Europe or elsewhere. And, you know, we've under historically we've understood that strength. Like I think lawmakers, policymakers have been examining, you know, for example, our deep reliances on Chinese manufacturing and on China for the far upstream chemicals that go into our small molecule drugs. These are called active pharmaceutical ingredient ingredients or key starting materials, APIs, KSMs. We've understood that dynamic for the better part of a decade. But what has changed in the last year or so, and I think even since we made our action plan public last April, is that innovation race. So not the manufacturing and scale-up race, but uh the ability to generate new intellectual property, new ideas, new drum discovery, new material discovery. That is the dynamic that we assess is starting to change. And frankly, it's changing, I think, more rapidly than many, many people expected.

SPEAKER_02 10:15

Yeah, I think one of the interesting things about reading the report that the commission has put together is that to be fair, look, I worked in government for like 12 years, and I can tell you that we weren't known for producing a lot of like the reports that we produced weren't known for their readability. But I would say for for the reports I've seen from you all, it's been very accessible, very easy to understand. And one of the things I'll point out is in the April report, you you mentioned this kind of alliterative beat that I thought was really elegant. So first they steal, then they scale, then they strangle. And so just to jump to that third beat, that strangle version, what does that look like in biotech? I'm just curious about that one.

SPEAKER_01 10:50

Sure. Um, thank you for the compliment. We worked really, really hard to make sure that folks um of of really all backgrounds could engage with our material, right? We we knew that there would be national security folks reading it, you know, deep scientific experts, folks with you know more agriculture and medical experience. And so um we really saw part of our goal as um as like expanding the aperture of bioliteracy, um, which we can talk about later if you want. Um it's something I'm really excited about. Uh but at the end of the day, I uh my calibration was like, would I have understood this a couple of years ago, you know, when I was a legislative director on the hill. Um but let's get to the steel strangle scale dynamic that you described, or excuse me, steel scale strangle dynamic that you described. Um you asked about strangle and what does that mean in practice? And what we're really describing there is a future where Chin the Chinese government has developed um a um, you know, sort of a key choke point, if you will, or or area of uh they've they've developed a uh we've developed a dependency on China for a certain part of the biotechnology ecosystem, or maybe multiple parts. And in doing so, have have created for the Chinese government geopolitical or trade leverage. So we in the beginning of our report, we actually write about a scenario in which a no-kidding cure for cancer, not a treatment for cancer, but a cure for cancer, is developed in China. And over time, American uh cancer patients gain access to that medicine. But then in the context of a um kinetic conflict, the Chinese government chooses to turn off or slow or taper supply to that medicine to create essentially leverage. And that's not a thing that's happening now. Let's be honest about that. But we have seen the Chinese government do something similar in other sectors to include critical minerals. So I think with that, you know, and and and we have this huge policy response from the United States government and from the investment community in the United States when China began to control the export of certain types of critical minerals that we needed for not just our defense industrial base, but our um uh, you know, our electronics and IT sector. So that's the type of action that we think could happen if we, you know, sort of develop and deepen these dependencies on China, not just for manufacturing, but frankly for our innovation base as well.

SPEAKER_02 13:38

Yeah, it it's and it's not you you're right, it's not an abstract concern because we've seen this strategy play out in real time. I mean, once they, you know, gallium, germanium, I mean, you could go down the list of the periodic table practically that China has a stranglehold on, the rare earths and all of the critical minerals, and they have in in some measure, you know, weaponized it a little bit, uh, use that as leverage, and and it's really awakened people to the the the concerns here, the choke points, as you mentioned. Um, and you mentioned also upstream, like the active pharmaceutical ingredients. We've talked about um at CPA, a lot of the work we've done is looked at just how uh concentrated that is in China as well as India. But you know, one of the things that that when we talk about China, it's often you're you're not gonna get too many skeptics when it comes to the whole idea of like, oh, they they're just stealing or they're just subsidizing, and that's the key to their advantage. Um, one of the things that surprised me when I've looked at this issue is just this isn't really just a you know a story about theft here. I want to get to the segment, the second segment here where we talk about how you know US companies are actually now helping to finance um some of these ventures. You know, there's a record number, for example, of licensing deals uh in place between US pharmaceutical companies and Chinese biotech firms. Um last I checked, it was about $53 billion worth of deals since 2020. And I don't think people most people necessarily know what's being bought here. So, like these aren't necessarily like finished medicines, but you know, what part of the drug development process, I guess, are these deals buying? If we start there and if we could talk a little bit about the implications of this whole licensing um infrastructure that's being built.

SPEAKER_01 15:10

Sure. So generally speaking, these deals are mostly about out major American biopharmaceutical companies outlicensing intellectual property from Chinese biotech startups. So they've discovered a, you know, China's Chinese biotech startup has discovered a new molecule, a new promising new therapeutic. And uh rather than develop something similar through domestic R ⁇ D channels, companies are, you know, doing licensing deals for that intellectual property, which they will then scale up and bring to market, you know, through their traditional channels. And a lot of these deals have these huge price tag price tags on them, um, you know, a billion plus dollars if the medicine is successful in meeting, you know, multiple milestones over the course of its commercialization process. Our concern about these deals is really that that those uh that money and those investments just get you know circulated back into RD and innovation in China, Chinese biotech startups, and not into the innovation pipeline and the RD pipeline here in the United States.

SPEAKER_02 16:20

Yeah, and so it's like the so is it pretty accurate to say that the early discovery kind of is happening in China. US firms are picking up the expensive late-stage trials. Um, is that is that dynamic pretty much well captured in that?

SPEAKER_01 16:34

It depends. Um, you know, I think it's hard to to generalize across all of these deals, but yes, I think safe to say that what uh most of these deals have in common is that they are a licensing, you know, the the the Chinese startup is taking care of sort of the early discovery process. It gets something promising. Um, maybe they take it through a you know, first and human trial, maybe that happens, you know, with the pharmaceutical company. Um, but early stage, and then it it gets picked up once it looks promising.

SPEAKER_02 17:08

Yeah. So when we think about just the the lay of the land here, I I mentioned earlier that, you know, a lot of people would would be on board with the idea of, oh, you know, China's just, you know, this is all a story about theft. They're stealing our intellectual property and all of that stuff. But if you actually look at how they have prioritized this industry and their approach to, you know, becoming a competitive industry, they've done things like streamline the regulatory process. That's been a real priority for them, and they've made real results in doing that. And now they're they're approving so many early stage clinical trials. You know, talk a little bit about that. So those are the things that I feel just don't get enough attention. Like these are legitimate moves that they're doing to kind of streamline regulatory procedures and things like that that we could really learn from, I think.

SPEAKER_01 17:51

Yeah. I think, you know, the way that we describe it here at the commission is essentially that they use both licit and illicit tactics to gain dominance. Um, so you're right, there's plenty of things that the Chinese government is doing above board to strengthen their innovation ecosystem. One of those things are major regulatory reforms, um, some of which are designed to bring drugs to market faster for the Chinese people, and others of which are designed to attract clinical trial activity, you know, away from the US or Europe or or even Australia and kind of accelerate that uh first and human uh trial, you know, phase one trial activity. Um but it's also on the back, like I said, of 20 years of strategy, which has included illicit tactics. So it's not just the kind of IP theft that I think a lot of American companies have become accustomed to. And certainly at the commission, we heard from plenty of American startups who described a scenario in which they would present at a conference or um, you know, pitch to an investor and then see a copycat, you know, company and a copycat slide, you know, pitch deck from their Chinese competitor weeks later. So that activity is still happening. It's still something that companies routinely talk to you know, me and my team about. Um, but we are also starting to see real innovation uh on the back of major investment that the investment that the Chinese government has made um uh, you know, in talite cultivation, in in research infrastructure as well as manufacturing infrastructure. And the use, we talked in our our December papers about the use of these government guidance funds to drive uh capital into the Chinese biotech uh private sector ecosystem. So it's a combination of things um that that is going on here, but but this is no longer a fast follow dynamic or a me too dynamic. This is truly um a competition about being out innovated.

SPEAKER_02 20:03

So let's step back for a second because it occurs to me that you know a lot of the listeners might think to themselves, like, why what makes China unique? Because I mean, if you're a multinational corporation, first of all, the incentives are there to you know lower your costs and um yeah, obviously people want to see cheaper drug prices. And I think it's it's it's hard sometimes to help people understand why China is a different animal in all of this. You mentioned the choke points and the risk of possibly weaponizing uh a molecule or drug that they have a dominant position over. But what are some of the other concerns that you have? I mean, I know, for example, our research has touched on this whole military civil fusion. Is that kind of something that you share a concern about? Or are there other concerns like on that national security front that make China something that we should really be concerned about?

SPEAKER_01 20:48

Sure. So look, biotechnology is extraordinarily powerful. Um, it can um cure disease, it can heal, it can nourish, it can build, um, but it can be also be used for harm. Um, and you know, I think that what we are what we are concerned about is a couple of things. First, that supply chain weaponization dynamic that we talked about. Um, we could talk more about that if you like, but that is that is a very real and present you know, national security risk for the United States. But we also need to, we do need to think about the military civil fusion dynamic. And I know you know your listeners are probably more familiar with this dynamic than than most, but basically just to say that the the Chinese law um allows for the government to and the and the military, the PLA, um, to work quite seamlessly with the private sector. And you know, one of our great concerns here is really about data and the the data security laws in China that essentially require that if you're doing business in China, you must make your about your data. Available to the Chinese government if it asks for it. Right. And that that is a significant national security risk, but it is also a significant business risk. So that's that is another one of the dynamics that we think is worth highlighting from a national security perspective. I think the other category of concern that, you know, certainly the Commission has wrote about, but that is that is shared, you know, reasonably widely here in Washington is about the sort of ethical and appropriate use of these powerful technological tools. And, you know, we we wrote about the need for the United States government to have a code of how, you know, a statement of policy about how we were going to use biotechnology ethically and appropriately in a conventional military context. Um, but I think it's safe to say that we we also have concerns about, you know, how the Chinese government would would uh ethically and appropriately apply these tools.

SPEAKER_02 23:06

Yeah, I mean, so many concerns that you raised, and it's so good to be hearing that and having this discussion. And I'm I'm happy to hear that, you know, obviously you mentioned up front you guys are a bipartisan organization or a bipartisan commission that was arranged that there's there is a lot of buy-in uh in Congress. And so let's move to segment segment three, talking about what's moving and what's left undone. Another really interesting thing about your commission, the commission's report that you guys have been working on is that look, I hope I'm not out of talking out of turning and right. So Congress isn't always known for moving things along. And yet, in in your case, I think it was like what 48 maybe recommendations. I'm gonna get that number wrong. Is it 48 or 46? 49, you're really calling. 49. I was wrong. Okay, 49 recommendations you all listed in your April report. And I I think it was 26 provisions, if I'm not mistaken, that have been signed into law. Um, so you know, what what do you think? Okay, so first of all, like to talk about the the significance of that accomplishment and and some of the big highlights of that of that basket of legislation that's been you know codified.

SPEAKER_01 24:08

Yeah, thank you so much. I uh I'm really proud of that, you know, execution number and and just want to take the opportunity to say that like there is an extraordinary group of people here at the commission, not just our commissioners, but our our staff who have been laser focused on making sure that this is not just a report that sits on people's shelves and that someday in a crisis people go, oh wait, we probably should have done these things. We, you know, Congress gave us a year and a half after we published our action plan until the end of this year to work alongside them to get as much of this done as possible. And, you know, you you counted up some of the numbers. The one that I'm really focused on is that between executive branch action and legislative action, 75% of our recommendations are moving forward in some way, shape, or form right now. So it's not everything all the time. You know, sometimes we get a little bit of a piece of something, um, you know, not the whole, the whole enchilada, but we are um super, super proud of this. And I think it comes back to two things. One is Congress asked for this, right? This was this was something that they knew um they were gonna need to tackle. And they can have confidence in the bipartisan nature of the recommendations that we came up with. We are a.gov entity financed with appropriations by the Congress. We are federal employees, we have security clearances. Like we um, I think there's a there is a, you know, and we can go credibly into members' offices and say, we work for you. We did this project for you. Um I think that has really helped. The other thing is that uh there was already, even before the commission started, a really remarkable network of biotechnology leaders across the United States. I think sometimes folks who aren't familiar with this technology think it's a thing that happens in like elite labs in Boston, the South Bay, and it is, but it is also a thing that happens in Indiana and Oklahoma and Texas. And I was just out in Colorado. Um, we have a team going to Ohio today. And and we have we basically landed on top of that infrastructure. And then, you know, again, another thing I'm really proud of is that we helped sort of like organize and galvanize all of this existing grassroots energy towards advocacy. And we, you know, we we conducted thousands of stakeholder consultations in the course of this project. But more importantly, over the last year, we have taken our message on the road uh in our biotech across America roadshow. Uh, Ohio, you know, just this week will be our 24th state. I think at one point we hope to get to all 50, but I don't think that's gonna happen, but we're gonna keep going. Um, maybe we get to 30. And really the essence, and and we always invite members of Congress and their staffs to come with us. That just happened out in Colorado. I was out there for two days. We had four congressional staffs with us from four different offices, um, really digging into what biotechnol, biotechnology, emerging biotechnology looks like on the ground in Denver and Boulder, and you know, uh, and uh, you know, all over that metro area. And the result of that is really significant buy-in from members. You know, I think when we are able to say this is what this looks like in terms of impact on your state or district, that makes a huge difference.

SPEAKER_02 27:29

So if I'm um for for listeners tracking at home, this is almost like you guys are almost like a unicorn, if I may say so. So you you publish readable, uh, accessible information on something that's a very otherwise complex topic that not a whole lot of people know about. You're able to secure action uh from Congress, who is no typically loath to kind of move on certain things. You've gotten some great traction on the hill. And so, how is it that you all aren't just like gonna be uh permanent? Why is it that your your your your commission is gonna be ending right soon? Or is that that's right, you guys are gonna be able to do that.

SPEAKER_01 27:59

Yeah, in December. In December. So our statutory authority from Congress was uh was temporary. You know, they they said go do this project for us, tell us what we need to know. And you know, we made that commitment. We we, you know, we while there's still gonna be plenty to do at the end of this year, um, we are actually really excited about the opportunity to kind of transition the work that we have been doing into a durable, sustainable kind of network of uh of advocates and and leaders in this space. We now have relationships with 400 member offices on the Hill. Um in the House of Representatives, there is now a biotech, bipartisan biotechnology caucus. It didn't exist even, I think it's I think it's literally a year old this month. Um it has 64 members. Those are champions who have raised their hands to be enduring leaders in this space. So, yes, it'll be hard to close the doors here, but we needed to be able to look not just our policymakers, but our industry and academic stakeholders in the eye and say, we have a limited window to fix this. We have time to act, we do not have time to wait. And I think one of the ways that we do that is by saying we need to get as much done as we can before December. And then it will be over to those biotechnology champions and those advocates to sustain the work.

SPEAKER_02 29:26

You know, I was thinking what of the in January we had published something at CPA about this biotech licensing, um, you know, the deals that are underway. And at the time, I think the Biosecure Act had just been um, I think it had just been signed around that time. How, I mean, that's that's the signature, you know, kind of legislation that I'm familiar with. Maybe if you could talk a little bit about how, you know, the the that bill has been um implemented and and maybe six like you know, success that might that that might lead the way for for future, you know, endeavors, free short legislation, like how's that been working? Because oftentimes what I've observed, at least from legislation that I see sometimes, we have the best intention, we put a law on the books, and there's loopholes that inadvertently emerge that are exploited. Um how do you yeah, how do you make you talk talk a little bit about that?

SPEAKER_01 30:13

Sure. So for those that aren't familiar with biosecurity, and it's essentially a um this is a really reductive way of describing it, but it's essentially a procurement, a government procurement ban that says that if you want to work with the United States government, receive a contract or a grant, you can't then turn around and work with a Chinese biotechnology company of concern. And we can talk about how we define that, but but company of concern is essentially a combination of two things. One, a list that the Department of War uh promulgates every year called the 1260H list. These are companies that the department understands or assesses have a connection to the Chinese military, the VLA. And uh the second category is a OMB process that will be stood up over the course of this year to name additional uh Chinese biotechnology companies of concern. And so the short answer to your question is that this legislation passed in December of last year after several years of, you know, from origination to negotiation to final passage, and it's not yet implemented. So the law gives O and B some time over the course of this year to come up with the regulations that will lead to implement, you know, full implementation of this. I do think that there are plenty of companies that are starting to think about how to dissolve relationships that they might have with companies on that 1260H list or companies that they believe might be listed as biotech companies of concern. Um, but your point is a really well well-made one, which is it's one thing to have, you know, good legislative intentions and congressional intent. It's another thing to see something fully implemented in alignment with that intent. And we are kind of in this um uh implementation phase, if you will, for biosecure. So it's too early to say what its net impact will be on the industry.

SPEAKER_02 32:11

Okay. So I'm gonna I'm gonna ask you a general question for you now. If you could just see, like if Congress could do just one more thing on biotech this year before you guys close your doors, what would it, what would you like to see? What would that be the big thing?

SPEAKER_01 32:23

I can't have 49 things. I want 49 things. Um not that. You know, it's funny you're the you're the second person today to ask me that question, and it's a nearly impossible one. I'm gonna briefly reject the premise and then I will answer it. So stick with me. Um here's the thing we actually have to do all of these things. There is not a silver policy bullet that is going to fundamentally uh, you know, arrest the slide of American biotechnology leadership and and you know create a durable American leadership future. We have to do things that are hard, that are going to cause um friction between the government and industry, between government and academia. Um, we have to be bold and brave, and we have to do things that we probably should have done sooner. Um, and that's gonna cost some money, it's gonna require some debate. There are, you know, active debates raging right now on um the right way to do these things. We feel like we offered a playbook, but then policymakers, you know, it's a playbook, right? It's a it's a set of recommendations. Policymakers need to grapple with that. They need to negotiate it. Um, but we told policymakers a year ago that they had three years to act, or we would begin to lose that historic edge in biotechnology in a way from which we would never recover, because this is not a linear race. This is a race of innovation flywheels that are actually accelerating as we speak. Yeah, I mean, a year is off that clock now, right? So two years. And we've done a lot. Like, and we should give Congress and the executive branch credit for seizing the moment and getting a lot done, but there is still a lot left to do. And to answer your question directly, um I would suggest two things. Um, the first is to pass the National Biotechnology Initiative Act, which is a bipartisan, bicameral bill led by our congressional commissioners. And what it really is about is um having the national strategy for securing American leadership in this space. It talks about the need to coordinate across the interagency and to really focus on streamlining biotechnology product regulation, which is a thing that we heard time and time again is a key point of friction between the US government and industry. Uh, that bill has a lot of support and that's growing. And so we would love to see members uh pass that bill this year. I think the other thing is just kind of capture, I mentioned data earlier. Um, we have a suite of legislation pending in both the House and the Senate that is essentially about making biological data a strategic national resource, um, both in the way that we collect and curate and make it ready for use in AI models, but also how we protect it. Um, so you asked me for one thing, I think I gave you 49 and then six, but don't make me choose.

SPEAKER_02 35:22

Well, you know, it's funny because it reminded me, because you actually did a great job answering that, by the way. But like, so when I was a kid and I was asked that question, you know, if a if you got a genie and it granted you like one wish, I'd say I wish for like a million more wishes, you know. Uh but you actually gave me something good and concrete, which I appreciate. Um thank you.

SPEAKER_01 35:38

So I always just wish for like an ice cream sandwich, so you know, always, always can't go wrong.

SPEAKER_02 35:43

Um, and I was actually one thing I was thinking about, you know, to kind of tie a bow around this this discussion, whereas, you know, so again, we at CPA we look at a lot of different industries, and sometimes it can be really defeating because you just look at the story, it seems so consistent all the time. Like the US was the inventor of this technology, and then in a matter of 20, 30, 40 years, we have seen that lead erode, and you look at enough charts and graphs and you start to see this dissonance between where China is and where we are, and you're just like, how do we even begin to the process, whether it's mining of rare earths and elders, things like that. This is an industry though where we still, if I'm not mistaken, still have an edge. It's not a wide one, it's a narrowing one, but we still have the advantages that you know just that make us the world-class, you know, engine of this of this industry. Um, so I I think, and I gotta believe that maybe that is motivating for policymakers to realize that there, you know, there are things that we can do to sustain that lead. Um, so I think a lot of the research you all have done have kind of really made that case that it's hope is not lost. We we we still have everything in front of us, you know. Um yeah.

SPEAKER_01 36:48

No, I I really meant what I said. Like there is time to act. Yeah, there just isn't time to wait. And you know, I think when we when we look at the comparison and there and in the different metrics, there are still places where the United States is the clear leader. There are some places where we are neck and neck, and there are some places where we are starting, you know, our lead is is eroding. Um, my message to policymakers is really that, you know, these are things that we can do right now to to create the conditions for, you know, a sustained American leadership in this space. All of our recommendations taken taken together amount to about a $15 billion investment over five years. It's gonna cost us a lot more money and a lot more political capital to reshore all of these capabilities once we've lost.

SPEAKER_02 37:39

Yeah. And it's you said, did you say $15 billion over four years? Did I hear that right?

SPEAKER_01 37:44

$15 billion over five.

SPEAKER_02 37:45

Over five years?

SPEAKER_01 37:46

All of our recommendations taken together are three billion dollars a year.

SPEAKER_02 37:50

That's unbelievable. Sorry, I'm just reacting in real time. Because I yeah, I had I talked to a gentleman who wrote the the book about Apple in China, um, and he talked about how uh Apple invested uh from 2015 onward about $50 like billion dollars a year in China. And then I was thinking about the CHIPS Act, which was a $53 billion investment over four years. And I'm astonished to hear that's a pretty tidy. I mean, that's a wow, that sounds very manageable. Yeah. We think so too.

SPEAKER_01 38:20

And we worked, we worked really hard to ask ourselves what are the things that the government can do that only the government can do to create the conditions here? And and we imagined not a public-private partnership, but actually a private public partnership because so much of the leadership in this space has come out from outside of government. And I don't just mean industry, I do mean academia and research institutions, and I mean philanthropy and all of that. Um, but our question to ourselves very consistently was is this something that the government can do uh and that the government can uniquely do? And then we put a price tag on that. And we think it's a fairly reasonable sum. It's a lot, you know, it's a lot of money. I would love $15 billion. Um but I think it certainly if you compare it to something like the CHIPS Act or um uh, you know, some of these other uh, you know, investments, uh you know, we think this is doable. And that's really our message to the policymakers.

SPEAKER_02 39:16

Fantastic. Well, Caitlin Frazier, Executive Director of the National Security Commission on Emerging Biotechnology. Thank you for coming on the show with us today.

SPEAKER_01 39:25

My pleasure. Thanks for the conversation.

SPEAKER_02 39:27

So learn more about our work at prosperousamerica.org and be sure to find us on YouTube, and you can check us out the big three on Apple, Spotify, Google, or wherever you get your podcast. Thank you for joining us.