According to analysts at Jefferies, legislation such as the newly proposed bills that aim to streamline regulatory processes would be a positive for the biotech industry.
Senators Todd Young (R-IND) and Alex Padilla (D-CA) on Thursday filed a bill to help revitalize biotech in the U.S. as a key component of national security and economic productivity. The bill seeks to establish the National Biotechnology Coordination Office (NBCO), which would reside under the Office of the President and be responsible for harmonizing federal initiatives on biotech and for streamlining regulatory pathways.
Representatives Stephanie Bice (R-OK) and Ro Khanna (D-CA), meanwhile, have introduced a parallel version of the bill in the House.
“We see strong support for optimizing regulatory processes and eliminating unnecessary bureaucracy” as a positive for the industry, Jefferies analysts wrote to investors Thursday evening, which in turn could lead to “quicker approvals.” The group referenced the new bills as one example but also noted “we will watch for other bills to come starting in the next few months which could touch more on incentives, supply chain onshoring, investment restrictions etc. [plus] other issues investors remain concerned about.”
Thursday’s proposed legislation, dubbed the National Biotechnology Initiative Act of 2025, is one of the principal recommendations from the recent National Security Commission on Emerging Biotechnology (NSCEB) report that warned the government that China is growing “dangerously close” to overtaking the U.S. as the global leader in biotech innovation. Young is the chair of the NSCEB, while Padilla, Bice and Khanna are commissioners.
Jefferies noted that across the industry, “onshoring manufacturing [continues] to be a major theme of conversation.” At the head of this push are Big Pharma players like Eli Lilly, Johnson & Johnson and Novartis, who in the face of President Donald Trump’s ongoing tariff threats have unveiled multibillion-dollar investments in the U.S.
Still, Jefferies warned that China is unlikely to play passive and instead could enact a “retaliatory strategy that does not just utilize tariffs but takes advantage of other strategies such as cutting off API [active pharmaceutical ingredient] supply.” China holds about 90% of API production, as per the analysts.
The NSCEB report outlines some 50 recommendations that the U.S. government can take to maintain and widen its lead in biotech. One of these is the establishment of the NBCO to help ease what Young and Padilla called “regulatory burdens” on well-characterized products. The NCBO would also be in charge of the overall biotech strategy in the U.S.
The director of the NCBO would serve as principal biotech advisor to the president. It remains unclear who the prime candidates for this position would be.
