Japan takes steps to protect pharmaceutical supply to forestall potential China curbs

Japan is seeking to protect its pharmaceutical supply chain for the long term, with analysts saying the pre-emptive move is due to fears of China using exports to its neighbour as a bargaining chip in the event of a deterioration in bilateral ties.

Such a scenario for the local pharmaceutical sector is plausible given that China curbed shipments of rare earth minerals to Japan following a dispute in the East China Sea in 2010, according to analysts.

Japanese authorities want local pharmaceutical companies to increase their investments and manufacturing of essential medicine ingredients to mitigate potential shipment disruptions from China, Kazuhiro Tateda, president of the Japan Association of Infectious Diseases, told This Week in Asia.

“The Japanese government is acting now to be prepared for a crisis, although I would have to say it started late and has some catching up to do,” said Tateda, who was a member of a government-appointed panel to advise Tokyo on the Covid-19 pandemic.

“We did not have shortages of key drugs during the pandemic, but it is easy to see pharmaceutical components being used in the same way as rare earth minerals were in the past.”

Japan imported US$451 million of pharmaceutical products from China in 2023, or 0.84 per cent of the country’s total imports for the sector, up from US$419 million in the previous year, according to United Nations data. In comparison, the US was the biggest supplier of Japan’s pharmaceutical products last year at US$76 billion, or 21.1 per cent of the total.