Treasury's COINS Act Plan Would Restrict US Pharma Investment in China

On October 22, the U.S. Department of the Treasury proposed extending restrictions on American investments in foreign companies to biotechnology, including pharmaceutical research, under the Comprehensive Outbound Investment National Security Act — the COINS Act.

The numbers behind the debate are stark. Chinese companies accounted for 39% of global cancer clinical trial starts in 2024, up from just 2% in 2009. Over the same period, American companies' share of those trial starts fell from 39% to 32%. The argument, laid out in an op-ed by the Pacific Research Institute's Sally Pipes, is that Treasury's proposal would accelerate rather than reverse that shift.

What would the proposal actually do?

Treasury wants to wall off American capital from foreign biotech targets it deems a national security risk. The stated goal is protecting national security — a goal the op-ed's author calls laudable. The objection is narrower: restricting U.S. drugmakers' access to promising research beyond U.S. borders could, in her view, benefit foreign competitors and ultimately deprive patients globally of lifesaving medical advances.

For R&D managers, the practical question is portfolio access. U.S. pharmaceutical companies have historically structured discovery, licensing and co-development deals across borders. If outbound investment into foreign biotech — Chinese biotech above all — requires Treasury scrutiny or faces prohibition, licensing pipelines that depend on Chinese science get harder to fund and slower to close.

How far has China actually advanced?

The op-ed anchors its warning in two data points, and both deserve scrutiny from anyone weighing the policy.

• Cancer trial starts: Chinese companies held 39% of global starts in 2024, against 2% in 2009. U.S. companies fell from 39% to 32% over the same window.
• Pipeline share: a June 2026 analysis by the Information Technology and Innovation Foundation found China now accounts for more than 31% of the global drug development pipeline, representing over 7,100 experimental medicines.

Those are measured results, not projections. A 15-fold rise in cancer trial starts over 15 years is a structural shift in where clinical evidence gets generated, whoever funds it.

Beijing has spent years trying to challenge U.S. dominance, the op-ed notes, pouring resources into pharmaceutical research and helping Chinese drugmakers become formidable competitors. The American system, by contrast, has historically rewarded risk-taking, attracted private capital from all over the globe, and given scientists the chance to profit from their discoveries — the mechanisms Pipes argues the new rules would weaken.

Competitive disadvantage, by whose measure?

The core claim is causation: Treasury's proposal threatens to put American drugmakers at a competitive disadvantage precisely as Chinese rivals gain ground. Treat that as an argument to interrogate, not a settled fact. The trial-start and pipeline numbers predate the proposal — the October 22 rule hasn't shifted a single dataset yet.

What the figures do establish is momentum. A rival holding 31% of the global pipeline, with more than 7,100 experimental medicines in play, doesn't need help from U.S. policy to keep compounding. The op-ed's wager is that capital restrictions would hand that rival an additional edge by cutting American firms out of the very research base growing fastest.

There's a budget dimension too. If U.S. capital can't flow to foreign biotech, some of it sits idle, some chases domestic targets at inflated valuations, and some flows to competitors' jurisdictions without such constraints. Portfolio managers will price that friction before Treasury finalizes anything.

What happens next?

The proposal is at the rulemaking stage; the October 22 text is a starting position, not final law. The Pacific Research Institute, a free-market think tank with a consistent track of opposing regulatory expansion into health care, is pushing for the biotech carve-out to be dropped before the COINS Act restrictions take effect — and the outcome will shape how easily U.S. drugmakers can keep tapping the research base that now generates 39% of the world's cancer trial starts.