CAMBRIDGE, MA — The United States risks a major setback in its global leadership in biotechnology, with Massachusetts—home to the nation’s top life sciences cluster—facing especially severe consequences, according to a stark new report released by the Massachusetts Biotechnology Council (MassBio).
The report outlines a cascading crisis for the biotechnology sector, as deep federal cuts to NIH funding, significant FDA staffing reductions, and new trade barriers threaten to disrupt the entire innovation pipeline—from early-stage research to clinical trials, manufacturing, and patient access to new therapies.
“Biotech is not just an industry—it’s a cornerstone of our state and national strength,” said Kendalle Burlin O’Connell, CEO and President of MassBio. “This analysis makes clear that without policy stability and renewed investment, we will cede leadership in a sector that defines the future of medicine, creates high-wage jobs, and safeguards our economic and national security. There is a real urgency in this because many of these impacts will be hard to reverse.”
Alarming Findings: Research, Regulation, and Investment at Risk
The report highlights a number of critical vulnerabilities across the U.S. biotech ecosystem:
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NIH cuts threaten foundational research: Every $1 million in NIH funding supports over eight jobs and has been tied to the development of 99% of drugs approved between 2010 and 2019. More than 20 million patients are treated annually with therapies that trace back to NIH-supported research. Current funding reductions jeopardize this vital early-stage work and ripple into downstream clinical development.
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FDA workforce reductions create costly delays: Ongoing staffing cuts have led to longer regulatory review times, increased compliance costs, and setbacks for next-generation therapies. Half of biotech respondents report being negatively impacted, and two-thirds express deep concern over future delays in drug approvals.
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New trade barriers strain supply chains: With over 70% of active pharmaceutical ingredients (APIs) sourced from abroad, new tariffs are projected to raise hospital drug costs by 15% and delay product launches. Half of affected biotech firms may need to postpone regulatory filings to find alternative supply chain partners. The cost of generics alone could rise by nearly 20%.
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Venture capital retreat stifles innovation: Faced with heightened policy risk and regulatory uncertainty, venture capital is flowing out of biotech. Early-stage deal values have dropped to a four-year low, as investors opt for sectors with faster returns and lower volatility.
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Global competition accelerates: Asia now leads the world in biotech patent filings and IPOs, largely driven by China. Without urgent U.S. policy action, the report warns, the innovation frontier may permanently shift abroad.
A Call for Immediate Policy Action
The MassBio report urges federal policymakers to reverse NIH and FDA cuts, avoid disruptive trade policies, and commit to a long-term innovation strategy that supports life sciences growth.
“Strategic investment in research, a fully staffed regulator, and stable, open supply chains are imperative,” said Burlin O’Connell. “By reversing the cuts to funding and staff, and establishing policies that foster innovation, ensure patient access, and support the long-term growth of the life sciences sector, the United States can accelerate development of the next generation of life-saving therapies, secure high-value jobs, maintain global leadership, and reinforce national security.”
“The choice is stark: lead the world in biotechnology or watch critical discoveries, economic growth, and strategic leverage migrate to rival nations.”
As the report warns, these are not abstract concerns—they are unfolding now across labs, companies, and research centers nationwide. Without intervention, the U.S. biotech sector—long the envy of the world—may soon find itself playing catch-up.
