In early 2025, biotech and pharmaceutical leaders experienced a pivotal moment—dubbed the “DeepSeek moment”—when they recognized China’s rapid advancement in innovation, drug development speed, and licensing deal share. This shift has been dramatic: global pharmaceutical companies spent approximately $9 billion on licensed drug assets from China in 2020. By 2025, that figure skyrocketed to over $137 billion, with nearly $50 billion in deals finalized in just the first two months of 2026.
A December 2025 report from the National Security Commission on Emerging Biotechnology highlighted this trend, stating, “In just three years, China’s biopharmaceutical industry rose from near irrelevance to dominance.”
This transformation is unfolding with the active participation of U.S. pharmaceutical executives, who critics argue are enabling the erosion of their own industry.
As a co-chair of a working group at the Council on Foreign Relations, I investigate the U.S.’s growing dependence on China for generic pharmaceuticals. Current estimates suggest that 60% of U.S. generic medications contain active ingredients sourced from China, with some projections placing this figure as high as 80-90%.
The exact percentage remains unclear due to gaps in tracking by the Food and Drug Administration (FDA). Additionally, many drugs imported to the U.S. originate in India, which relies heavily on chemical precursors from China. This layered dependency further obscures the full extent of China’s influence on America’s pharmaceutical supply chain.
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