Claudia Zylberberg, Ph.D., Chair of the Board and Co-Founder, Kosten Digital
The BIOSECURE Act would probably introduce stricter oversight on biopharmaceutical products' manufacturing, safety, and security in logistics and traceability, particularly in vaccines, advanced therapeutics, and other biologics. This would include:
Real-time reporting for production, shipping, and storage conditions of biologics, requiring a secure digital infrastructure to ensure traceability and data integrity;
Additional layers of security in manufacturing protocols and cybersecurity; and
Inevitable compliance cost increases in regulatory filings, product testing, and infrastructure improvements.
The BIOSECURE Act is also likely to alter market competition and demand dynamics, with:
A greater need for novel compliance technologies and services to maintain competitive advantage. Companies like Kosten Digital could see an uptick in demand, with interest growing for AI applications and automated solutions that streamline data management, compliance and monitoring.
Industry reliance on globalized supply chains, possibly leading to increased scrutiny on the geopolitical risks and security.
More M&A.
A need to develop robust, decentralized manufacturing and supply frameworks to ensure international continuity and compliance.
In the long term, the BIOSECURE Act could enhance product safety and security, make the industry more resilient to risk, and strengthen public trust by ensuring better safety. The industry will need to navigate these changes carefully to maintain innovation and growth in a highly regulated environment.
Stella Vnook, Chief Executive Officer, Likarda
The BIOSECURE Act has already begun to influence the industry, leading to a noticeable decline in new biopharmaceutical manufacturing agreements with Chinese partners while increasing collaborations in other regions, like Europe. Companies are rethinking their supply chains and considering alternative partners to mitigate the risks posed by the restrictions. This disruption also creates opportunities for CDMOs outside China to capture new business. We may also see greater industry collaboration as companies seek to share resources and expertise to navigate these new regulations. However, it could lead to regionalization, as companies look to reduce dependence on international suppliers to avoid risks of disruption.
The act is poised to heighten regulatory requirements for ensuring the traceability and integrity of products throughout their life cycle. Biopharmaceutical companies will be expected to strengthen their quality assurance and monitoring systems, potentially through technologies like blockchain and advanced analytics, to meet the new standards.
These added regulatory burdens may create challenges for smaller biotechs, along with added costs due to limiting CRO/ CDMO options. In an already challenging market, these companies may need to raise more money or delay their development work. Allocating more resources toward compliance could slow down innovation if not managed effectively.
Kevin Kyle, Chief Executive Officer, GermFree
The BIOSECURE Act introduces critical measures to protect national security by prohibiting federal agencies from procuring biotechnology equipment or services from companies deemed a risk. Market dynamics will shift as companies adapt to sourcing from compliant providers, potentially leading to greater consolidation of trusted, U.S.-based biotechnology suppliers and innovators.
The act's grandfathering clause would provide an eight-year transition period, allowing companies time to shift their operations. However, the immediate impact will likely be a push toward more secure and transparent supply chains, reshaping market dynamics and driving demand for compliant, U.S.-based alternatives.
These shifts may also prompt industry consolidation as companies work to meet stricter compliance requirements. From my perspective, this shift not only strengthens national security but also creates an opportunity for U.S.-based innovation to take the lead in the global biotechnology market.
Joel Eichmann, Dr. Rer. Nat., Co-Founder and Managing Director, Green Elephant Biotech
The BIOSECURE Act will redefine biomanufacturing by introducing heightened security and compliance standards, particularly for advanced therapies, like cell and gene therapies. While the intent is clear, implications for manufacturers, especially smaller companies, are significant. Companies will need to adopt traceability technologies, enhance cybersecurity, and consider automation to meet the new regulatory demands. This will likely increase operational costs and could push smaller firms to seek partnerships or outsource manufacturing to contract development organizations.
These changes offer an opportunity for early adopters of automation and digital traceability to gain a competitive edge. However, for smaller biotech firms, navigating these new requirements will require careful strategy, balancing innovation with compliance. Ultimately, those that successfully integrate these security measures will not only meet regulatory demands but will also position themselves as leaders in biomanufacturing, capable of delivering safe, high-quality therapies in a rapidly evolving market.
John Tomtishen, Senior Vice President and General Manager, Cellares
The BIOSECURE Act will play an important role in shaping the biopharmaceutical industry in the future. While there exists some uncertainty around the BIOSECURE Act and its implementation, you are starting to see companies develop strategies to navigate the evolving biopharmaceutical landscape that will take shape over time from this legislation. The passage of the BIOSECURE Act will not only have an impact on the biopharmaceutical supply chain, but it will ultimately impact the end-to-end drug development life cycle for therapeutic developers. You will see new partnerships and collaborations develop, changes in corporate strategy, and a shift in capital investment towards different businesses and technologies. The impact of this legislation will be far-reaching, as it will shape the biopharmaceutical landscape domestically and abroad. It will be critical for therapeutic developers to successfully navigate the impact that this legislation will have on the industry to ensure supply chain resilience and continued therapeutic innovation for patients.
Simon Szewach, Executive Chairman and Co-Founder, Gelteq
The BIOSECURE Act prevents U.S. pharmaceutical companies that receive federal funding from working with five Chinese biotechnology providers of concern. The legislation focuses on national security and is meant to protect the genetic and health data of Americans. We believe that the act may cause issues with the supply chain since there are a significant number of companies that would be impacted by the legislation. However, U.S. manufacturers would benefit as more pharmaceutical companies would look to companies in the country to meet their needs. Our expectation is that companies would adapt quickly, and supply chain issues would be mitigated effectively.
In terms of regulatory compliance, the BIOSECURE Act would create a more stringent pathway in the future, where a requirement of conscionable due diligence is placed on federally funded companies. Implicitly, the BIOSECURE Act includes not only organizations that gather, aggregate, or process data from individuals but also supporting technologies that enable those activities. If a biopharmaceutical company derives information from harvested data or if data can be used to identify an individual or group or otherwise be misused, then the company has a duty to tread carefully and ensure quality systems and partners meet high standards of traceability. That does not preclude us from developing novel intellectual property with partners but means that the innovation is protected and used for the purpose intended.
Jordi Robinson, Chief Commercial Officer, Navin Molecular
China has grown to become an important manufacturing source for active pharmaceutical ingredients (APIs), in both the commercial and clinical development phases. However, since the BIOSECURE Act was passed in the U.S. House of Representatives — and while it is technically not yet law — this has had a significant impact on attitudes within the industry, and the potential exposure it may have on pharmaceutical companies outsourcing to CDMOs within the country. Although there are only a small number of Chinese companies actually named in the BIOSECURE Act, there is a growing concern among U.S. and European innovators about the wider implications of working with Chinese CDMOs and ensuring their supply chain security for existing and future projects. This has led to companies looking for alternative suppliers outside of China but maintaining the structural advantages, such as access to key technologies and a lower cost base, with India becoming a more attractive option for clinical and commercial API manufacturing. Although the outcomes and timeframes associated with the BIOSECURE Act are uncertain, its implementation does have the potential to cause major disruption to the outsourcing paradigm that has been in place since the early part of the 21st century.
Joerg Ahlgrimm, Chief Executive Officer, SK pharmteco
If the BIOSECURE Act is signed into law as expected, it will profoundly impact the biopharmaceutical industry. With an estimated 80% of U.S. biopharma companies working with a Chinese-based CDMO, it could lead to increased costs, altered market dynamics, and a need for innovative solutions and alternative capacities.
We anticipate a shift of development and manufacturing activities from China to alternative geographies. Accordingly, SK pharmteco is investing in significant additional capacity in Europe. South Korea, in particular, is emerging as an attractive location for a redistribution of supply chain activities, providing sophisticated infrastructure and a stable economic environment while enabling SK pharmteco customers to benefit from an optimal balance of security, compliance, and cost.
SK pharmteco recently announced plans to invest $260 million in a new facility in South Korea to manufacture small molecules and peptides. This investment aims to diversify the supply chain and reduce reliance on Chinese sources across important modalities.
Lonnie Barish, Vice President, Business Development, Selkirk Pharma
Primarily, the U.S. BIOSECURE Act aims to prohibit U.S. companies from doing business with select Chinese biopharma firms, citing national security concerns. This may potentially impact the U.S., Chinese, and other world markets, leading to significant shifts, with U.S. companies re-evaluating their supply chains and partnerships.
The U.S. biotech sector has seen significant growth, while China's market has recently declined, partly due to investor apprehension due to the act. The act has dampened investor confidence in Chinese biopharma companies, leading to financial difficulties for startups and companies in the early stages of research. The act could disrupt U.S. biotech companies that contract with Chinese firms, leading many to seek alternative suppliers. Some believe the act will enhance U.S. security and competitiveness, while others argue it could stifle innovation and collaboration.
Besides the U.S. and the EU, the act may also shift investments to other countries like India. U.S. companies might need to find new funding sources and partners, potentially delaying projects. Many big companies are discussing strategies to diversify production away from Chinese manufacturers named under the act. Despite initial disruptions, experts predict a rebalancing as U.S. and Chinese firms adapt to the new landscape. The act has created heightened uncertainty and prompted strategic realignment within the Chinese biopharma sector.
Kean Woodmansey, Senior Global Market Development Manager, Pharma, SCIEX
From my perspective, the BIOSECURE Act will undoubtedly complicate biopharmaceutical business, especially in Asia, and this shift is likely to reshape the global biotech landscape. U.S. firms will face more hurdles during collaborations, particularly around gene-editing and sensitive pathogen research. Tightening biosecurity regulations may cause U.S. companies to seek research partners and suppliers based in regions that align better with these new standards, meaning new places may be seen as an attractive hub for innovation, partnerships, and investments. I expect we’ll see a more diversified global distribution of biotech work.
Anna Codina, Ph.D., Senior Director Biopharma & Strategic Market Development, Bruker BioSpin
The BIOSECURE Act will directly impact pharmaceutical and biotechnology companies that rely on CRO and CDMO services provided by the named entities. The passing of this act has far- reaching implications, including the potential both to affect drugs that are currently in development or preclinical trials, and to cause drug prices to rise as biopharma companies will be unable to access low-cost R&D and manufacturing partners overseas.
Many pharmaceutical companies are being forced to re-evaluate their outsourcing strategy, and are considering reshoring, insourcing, strategic alliances, and shifting to other regions.This will give rise to a partial move away from cost-driven CRO/CDMOs to potentially more expensive specialized outsourcing partners, resulting in an overall short term cost impact for the sector.
Given the headcount cost and with the mandate of ‘do more with less’, companies are looking at automation and digitalization. Achieving their effective implementation, however, is not straightforward and often requires the integration of disparate equipment from different vendors, which generates data in different formats, cumbersome to combine and utilize. The route to success is to have automation, digitalization, integration, and instrumentation under one umbrella: automation from R&D to manufacturing powered by a digitalization platform that gathers, standardizes, and makes data reusable, automation-ready and AI-ready.
