Innovation, power and the U.S.–China biotech race

ABOUT THE AUTHOR: Sergio de la Peña, a retired U.S. Army colonel, is the former deputy assistant secretary of defense for Western Hemisphere Affairs.

When President Donald Trump ran for re-election, he promised to make the world safer by restoring American strength. As his second term approaches the halfway mark, that promise has largely been kept. America’s borders are more secure, its military posture has been reinforced, and its economy is stronger and more resilient than it was just a few years ago.

All of that matters because national security in the 21st century is not measured by military power alone, but by the economic, diplomatic, informational and technological foundations that sustain it.

Yet there is a looming policy risk that could quietly undermine those gains. It is not emerging on a battlefield or through a missile test, but through a proposed health care policy that would weaken one of America’s most critical strategic advantages: leadership in biotechnology and pharmaceutical innovation.

The so-called “most favored nation” (MFN) drug pricing proposal would import foreign price controls into the U.S. health care system by tying American drug prices to those set by socialized health care systems overseas. In practice, that means allowing foreign bureaucracies — many of them in countries that free-ride on American innovation — to dictate the returns on U.S. biomedical research. While framed as a cost-containment measure, MFN would function as a blunt price control, sharply reducing incentives to invest in the risky, capital-intensive process of developing new medicines.

That is not merely an economic concern. It is a national security problem.

Biopharmaceutical innovation sits at the intersection of public health, economic power and geopolitical leverage. Advanced therapies, vaccines, gene editing, synthetic biology and bio-manufacturing are all dual-use capabilities with profound implications for pandemic preparedness, military readiness and strategic autonomy.

Of particular concern are biopharmaceuticals that can potentially be weaponized. The Biological Weapons Convention allows member states to engage in peaceful research, but questions regarding compliance by the Chinese Communist Party persist.  

Countries that lead in these fields do not just cure diseases — they set standards, control supply chains, and shape global dependencies. However, when governments impose price controls, innovation predictably slows. Companies redirect capital away from long-term research, clinical trials move overseas, and breakthroughs are delayed or abandoned altogether.

We have seen this play out repeatedly in Europe and other countries with state-directed pricing regimes. The result is fewer new treatments, slower access for patients, and diminished domestic research ecosystems.

Meanwhile, at the precise moment when Washington is debating whether to adopt such policies, Beijing is accelerating in the opposite direction.

The CCP has explicitly designated biotechnology as a strategic emerging industry. Through state subsidies, civil-military fusion and centralized industrial planning, China is racing to dominate biopharma, synthetic biology and advanced manufacturing. It is rapidly expanding research parks, scaling clinical trials, and integrating biotech into its broader military-civil strategy. Chinese firms are filing patents at record rates, acquiring foreign research, and positioning themselves as indispensable nodes in global life-sciences supply chains.

This is not market competition — it is techno-mercantilism with strategic intent.

If MFN pricing weakens American innovation, the consequences will extend far beyond balance sheets. In the next pandemic or biological crisis, the United States could find itself dependent on Chinese-linked supply chains for critical therapies, vaccine inputs or manufacturing capacity.

In some cases that has already happened, with China responsible for 95% of U.S. imports of ibuprofen, 70% of acetaminophen, and 40-45% of Penicillin. That dependency would hand Beijing coercive leverage at the very moment when speed, trust and reliability matter most. Reliance on a geopolitical rival for life-saving technologies is not cost savings — it is strategic vulnerability.

Trump has rightly focused on restoring deterrence abroad and resilience at home. But deterrence in the modern era depends not only on ships and aircraft, but on who leads the laboratories, controls advanced manufacturing, and defines the future of medicine. Economic strength fuels technological leadership, and technological leadership underwrites national power.

MFN drug pricing risks breaking that chain. By importing foreign price controls, it would hollow out America’s biotech sector, push innovation offshore, and cede strategic ground to a Chinese system designed to exploit precisely that kind of self-inflicted weakness. 

This is a policy choice that can still be avoided. Rejecting MFN is not a defense of the status quo; it is a defense of American leadership in a critical arena of great-power competition. The United States should be confronting foreign free-riding through trade and diplomacy — not copying the very policies that have left other countries dependent on American innovation in the first place.

In the race between the United States and China, biotechnology is a decisive front. Preserving America’s innovation advantage is not optional. It is essential to our economic vitality, our public health, and our national security.