The island that can save America | TheHill
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The U.S. has a dire need to end its reliance on foreign-produced pharmaceuticals and medical supplies, and Puerto Rico has ready solutions.
Homemade masks. Ventilators from Russia. Critical drugs in scarce supply. As our health care workers scramble to fight the pandemic with insufficient tools, the country has woken at last to the danger of our reliance on foreign-produced drugs and medical equipment.

The Trump administration took an initial step toward rectifying it last week. It awarded a $354 million contract to a Virginia company to make COVID-19 treatments on U.S. soil, leading Peter Navarro, the president's economic trade advisor, to call it "an historic turning point."

As we focus on rebuilding our formerly vibrant pharmaceutical manufacturing base, policymakers should remember the place where so much of it was once located: Puerto Rico. That began to change in 1996, when federal tax policy spurred manufacturers to move out of Puerto Rico to foreign countries with cheap labor and low taxes, like China and India.


Puerto Rico can still offer immediate solutions to the current crisis, however, if the administration and Congress use the next relief package to create economic incentives to address two urgent needs at once: re-domesticating pharmaceutical manufacturing and stimulating the Puerto Rican economy.

Before 1996, the tax code gave makers of drugs and medical devices favorable treatment for manufacturing products in U.S. territories, such as Puerto Rico. At that time, Puerto Rico was the American engine of pharmaceutical and medical device manufacturing. Many, if not most, domestic companies had a presence there. In an effort to curb "corporate welfare," however, the Republican Congress passed and President Clinton signed the Small Business Job Protection Act of 1996, which phased out the tax exemption. The results were predictable.

The manufacturers…
Luis G. Rivera-Marin, Christopher P. DePhillips and William J. Hughes, Jr., opinion contributors
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