Seattle Biotech Presses D.C. on Manufacturing Gap With China

Seattle has the science but not the factories

Arzeda is a Seattle startup that uses AI to design enzymes for products as ordinary as laundry detergent and stevia sweeteners. When it needs to make those enzymes at commercial scale, it often has to go overseas. That problem was the center of Seattle's pitch to the National Security Commission on Emerging Biotechnology (NSCEB) when the congressionally created panel held a forum in the city in late August.31 Local leaders gave the commissioners the same message from several angles. The region can produce breakthroughs, but it lacks the manufacturing infrastructure and the trained workers needed to keep those breakthroughs on U.S. soil.31

Arzeda CEO Alexandre Zanghellini said it has been hard to find domestic manufacturers with the skills and capacity to make specialized proteins. For a young company, he said, delays at that stage can be "catastrophic."31 Speakers described a financing "valley of death" between lab and factory. Federal grants pay for basic research and venture capital pays for early discovery. Building or renting commercial-scale facilities, though, offers returns that don't appeal to venture investors, and banks are reluctant to lend for it.31

The Seattle visit happened in August. Six weeks later, it looks like an early sign of the argument that has since taken over Washington's biotech debate. That argument is less about whether the U.S. is losing ground to China than about whether the fix is to slow China down or to build more at home.

A region with a strong hand and a weak link

Seattle's research credentials are not in doubt. The University of Washington's Institute for Protein Design, run by 2024 Nobel laureate David Baker, has spun out more than 20 companies. Fred Hutchinson Cancer Center and the Allen Institute anchor a deep life-sciences base around it.31 The state's trade group, Life Science Washington, counts roughly 1,200 companies in a sector it values at $41.2 billion.32 Alexander Titus, an NSCEB commissioner who has led AI-focused biotech efforts in the region, singled out companies like Arzeda as leaders where AI meets biology.31 Arzeda shows what that looks like in practice. Its first AI-designed commercial product launched in 2024, and the company is negotiating a $44 million contract with the Defense Threat Reduction Agency related to biothreat response.31

The weak link is just as concrete. Last year, Sana Biotechnology dropped plans for a manufacturing plant in Bothell that was supposed to employ hundreds of people and hired an outside contract manufacturer instead to cut costs.31 Snehal Patel, Sana's chief technical officer, said the Seattle area could match China's fully integrated supply chain on speed and cost if it had the right resources.31 The workforce gap matters too. Fred Hutch's Rebecca Bryant said Washington trains people well for research jobs but has nothing comparable for entry-level biomanufacturing work. Local leaders proposed a workforce consortium backed by the state or federal government.31

Seattle has made this case before. Life Science Washington CEO Marc Cummings has argued that the region is a top AI-biotech hub that undersells itself, and he has warned that stacked city and state taxes are causing a "slow attrition" of companies to friendlier places.32

What the commission has, and how little time it has left

The NSCEB has 11 bipartisan members and has worked since 2022. Its report to Congress contained 49 recommendations, which together call for at least $15 billion in federal spending over five years.31 Two of them speak directly to Seattle's complaint. One is a national network of pre-commercial manufacturing facilities for scaling up bioindustrial products. The other would require companies to disclose where their supply chains depend on countries of concern.31 Those proposals would mean a startup no longer has to choose between sending production abroad and building a whole plant itself.

The commission's tally of its own progress has moved over time. In Seattle, Titus said 26 recommendations had been written into law in some form.31 The commission's October newsletter reported 28 enacted provisions covering 25 recommendations, with 41 recommendations having seen bipartisan action in at least one chamber.7 The difference reflects how the counting is done more than any reversal. The bigger point is the deadline: the commission shuts down in December, and its vice chair, Michelle Rozo, has told senators that its mission must outlast it.931 The commission's broader warning is that the U.S. has roughly a three-year window before it may fall behind permanently.1

Since August, the stakes have climbed

The weeks after the Seattle forum gave the debate more urgency. Beijing published a five-year plan that aims to have Chinese-developed drugs make up a quarter of the world's first-in-class medicines by 2030, and to put at least five Chinese drugs above $1 billion in global sales.14 BioSpace reported that the plan sets a target of about $522 billion in combined revenue for China's domestic biotech industry.43 At the end of September, dozens of executives from the newly formed American Biotech Innovation Alliance came to Washington to warn Congress about weak federal planning. They cited a Georgetown study showing China's share of early-stage drug development rising from 8% in 2015 to 32% in 2024, while the U.S. share fell from 48% to 37%.12 Endpoints reported that the group also pointed to strain on the FDA's capacity after the DOGE-era staff cuts.46

The dealmaking points the same way. In early October, Novartis agreed to pay $575 million upfront in a deal worth up to $7.8 billion for an mRNA therapy from China's Abogen. ING expects China to supply about a third of new molecules in global pharma pipelines this year, up from 4% in 2014.22 Estimates of last year's outbound licensing total vary by tracker. SCSP cites $115 billion, Reuters reports a record $137.7 billion, and Rozo told senators deals topped $135 billion.14219 Every count shows a sharp rise, so the disagreement over exact figures doesn't change the trend.

The Special Competitive Studies Project offers perhaps the clearest framing. It found that the U.S. still leads on finished output, such as approved first-in-class drugs, while China leads or matches it on the leading indicators that predict future output: patents, early pipelines and first-in-human trials. SCSP projects that China will overtake the U.S. by 2030 if current trends hold.14

Hawks and builders

This is where the coverage splits. Lawmakers are considering expanding outbound investment screening to cover biotech. The Biotech Investment National Security Act would put pharma licensing deals, joint ventures and IP arrangements with Chinese firms under Treasury review, and the fiscal 2027 defense bill is the likely vehicle.5 Critics say this would backfire. A Washington Examiner op-ed argued that broadening the COINS Act to cover biopharma would leave Beijing as the only gatekeeper for promising early-stage compounds.13 Treasury is reportedly drafting rules that would keep most licensing deals intact, which is a softer line than some lawmakers want.14

Gary Locke, a former Washington governor and U.S. ambassador to China, wrote with former congressman Patrick McHenry that broad tariffs and limits on partnerships could weaken American biotech. They argued for strengthening supply chains, coordinating with allies, investing in next-generation manufacturing and protecting the research ecosystem.11 Analysts interviewed by BioSpace made a similar point: trying to hold China back is the wrong response, and consistent funding across the long gap between NIH research and clinical validation matters more.43

The reading: Seattle asked the right question

Seattle's pitch deserves more weight than the attention it got. The fight over restrictions involves real disagreements about security and access. The manufacturing gap Seattle described is the rare issue on which hawks and builders already agree. The NSCEB treats domestic scale-up as part of national security.31 Critics of restrictions, from Locke and McHenry to CEPA, say the most durable response is building capacity at home and with allies.11 Lawmakers can argue about licensing rules for years. Meanwhile, a company like Sana that can't justify a local plant shows the U.S. losing ground right now.31

That makes the question for this Congress fairly concrete: will the commission's manufacturing-network and workforce proposals survive once the commission itself is gone? An NSCEB event on November 17 is set to address what comes after the commission.7 Without a sponsor for those ideas, Seattle's main lesson may be forgotten: the U.S. is not short of discoveries. It is short of places to manufacture them.