First, the BIOSECURE Act is now law. Signed on December 18, 2025, it restricts U.S. federal procurement and grants involving biotechnology products or services from designated “biotechnology companies of concern.” The first official list of designated companies is expected by December 18, 2026, followed by agency guidance and updates to federal procurement rules.
Second, U.S. pharmaceutical tariffs have added a cost and geography dimension to the same conversation. On April 2nd, 2026, the White House announced a Section 232 framework that includes a 100% tariff on certain imported patented pharmaceuticals and associated ingredients, with lower rates or exemptions depending on country of origin, onshoring plans, MFN (Most Favored Nation) pricing agreements, and product category.
The message for innovators is simple: where and how a product is developed and manufactured now matters well beyond the next clinical batch.
Figure 1. BIOSECURE Act implementation timelines from
signing to enforceable federal procurement rules.
The BIOSECURE Act does not mean every China-based partner is automatically off-limits. The market view is more nuanced than that.
A CPHI survey of pharma companies found that only 19% of respondents believed China-based CDMOs should be removed from Western supply chains. The largest group, 43%, took a more balanced position: recognizing the value Chinese CDMOs have brought to the industry while also supporting supplier diversification.
That framing is instructive. This is not a “leave China tomorrow” conversation. It is a “do not be single-threaded” conversation.
At the same time, the level of exposure is real. A BIO survey of 124 biopharma companies found that 79% had at least 1 contract or product agreement with a China-based or China-owned CDMO/CMO. BIO also reported that switching manufacturing partners could take up to 8 years, especially for advanced or approved programs.
That timeline is why this matters now. If a program needs to move later, the work cannot always be done quickly.
The question is not only: “Is my current CDMO allowed today?”
The better question is: “Will this manufacturing strategy still be defensible in 2 to 5 years?”
That means defensible to investors. To strategic partners. To regulators. To potential acquirers. And, for some companies, defensible for future access to U.S. federal funding, grants, or government-linked supply opportunities.
This shift is already changing behavior. L.E.K. reported that confidence among U.S.-based life sciences companies in working with Chinese companies dropped by 30–50%, with CDMOs expected to be among the most affected. Another report by BioXconomy on the same survey noted that 26% of respondents were looking to shift away from current Chinese suppliers, while only 2% had already started unwinding relationships.
That gap matters. Many companies are not moving yet, but they are already asking different questions.
Investors are already pricing this risk in. A growing number of U.S. biotechs are now disclosing Chinese CDMO relationships in securities filings as material risks, and several small-cap companies have seen stock declines after announcing new partnerships with China-based manufacturers According to Greenberg Traurig, these disclosures signal that BIOSECURE-related exposure is no longer just a compliance issue; it is becoming a factor in valuation and investor confidence (Greenberg Traurig, "BIOSECURE Act Advances in the US Senate," November 2025). For early-stage companies where financing momentum is everything, manufacturing geography is now part of the investor conversation.
BIOSECURE creates supplier eligibility and funding uncertainty. Tariffs create cost and import uncertainty.
The pharmaceutical trade relationship between the U.S. and Europe is large enough that this cannot be ignored. In 2025, the EU exported €366.2 billion of medicinal and pharmaceutical products globally. The U.S. was the largest destination, accounting for 43.8% of extra-EU exports, or €160.6 billion.
That is why tariffs matter for supply chain planning. Even if a specific product is exempt, reduced, or treated differently under the tariff framework, the direction of travel is clear: U.S. policy is pushing the industry to think harder about domestic manufacturing, onshoring, and supply chain resilience.
Large pharma is already responding this way. Novartis said it expected to eliminate U.S. tariff exposure by mid-2026 because of its ability to produce in the U.S. for the U.S., supported by a broader $23 billion U.S. manufacturing investment plan.
Emerging innovators do not need to copy large pharma’s infrastructure. But they do need a credible answer when investors or partners ask: “If policy changes, can this program still move forward?”
This does not mean every sponsor should transfer programs immediately. In many cases, that would be unnecessary, expensive, or disruptive.
But every sponsor should understand where risk sits across the development chain:
The key is to know whether the program is transferable if needed. Are the process records strong enough? Are analytical methods well documented? Are raw materials and critical reagents controlled? Is there a realistic comparability strategy? Could another CDMO pick up the program without major disruption?
For early-stage innovators, this review can prevent painful decisions later. For clinical-stage companies, it can protect financing and partnering timelines. For companies moving toward commercialization, it can reduce the risk of being locked into a supply chain that becomes harder to defend.
Speed and cost still matter. They always will.
But in 2026, they are no longer enough.
Sponsors and consultants should now be asking:
These questions are where U.S.-based biologics development and manufacturing capacity becomes a strategic advantage, not just a geographic one.
A U.S.-Based Partner Built for This Moment
KBI Biopharma’s U.S. network is designed to address each of these considerations. Our capabilities include process and analytical development, cell line development, mammalian clinical and commercial cGMP manufacturing in North Carolina, commercial mammalian capacity at Patriot Park, and microbial development and cGMP manufacturing in Boulder, Colorado.
The value is not simply “manufacturing in the U.S.” The value is giving innovators a supply chain story that is easier to defend technically, commercially, and strategically.
BIOSECURE and pharmaceutical tariffs are pushing biopharma companies to think harder about supplier risk, geography, transferability, documentation, and long-term optionality.
For innovators, the strongest CDMO strategy is no longer just the fastest path to the next batch. It is the path that keeps the program fundable, partnerable, transferable, and commercially credible if the policy environment evolves.
For consultants and advisors, the question to ask clients is no longer, “Who can make this?”
It is: “Who can help us build a manufacturing strategy that still makes sense 2 to 5 years from now?”
For biopharmaceutical innovators evaluating their CDMO partnerships, planning for clinical scale-up, or preparing their supply chain for investor and partner diligence, KBI Biopharma is built to help.
Our team works with sponsors to develop biologics manufacturing plans that are defensible today and adaptable as the policy environment evolves. Reach out to our experts below to see how we can help you navigate through this complex process with your program.