Executive Summary

• The Food and Drug Administration (FDA) is attempting to encourage domestic pharmaceutical manufacturing with policy initiatives such as the PreCheck Pilot Program, which seeks to reduce the regulatory burden in operationalizing manufacturing facilities.
• Pharmaceutical manufacturing is a high-profile interest for U.S. policymakers and the wider health care industry, with both expressing support for policy initiatives that advance key principles such as transparency, strong supply lines, enhanced inspections, and the adoption of innovative technology to support increased domestic manufacturing capacity.
• This insight reviews elements of the regulatory environment surrounding manufacturing, analyzing how certain FDA initiatives, such as PreCheck, have advanced key principles for domestic manufacturing success.

Introduction

Increasing pharmaceutical manufacturing capacity in the United States is a central interest of policymakers and the health care industry. Achieving this aim requires alignment between industry and regulators. Regulatory volatility across the federal government, including the Food and Drug Administration (FDA), can suppress the necessary long-term investments that manufacturing requires.

To encourage domestic manufacturing, the FDA has introduced policy initiatives such as the PreCheck Pilot Program. The program seeks to reduce the regulatory burden in operationalizing manufacturing facilities through improvements including earlier FDA-industry communication on required facility inspection. This and other initiatives are intended to advance policies that support regulatory transparency, supply chain resilience, inspection efficiency, and the adoption of innovative technologies.

The PreCheck Program is a promising pilot, and should be paired with further, more permanent policies to encourage domestic pharmaceutical manufacturing. This requires implementing clear, pro-growth federal regulatory policies that support an environment conducive to business expansion. This insight reviews key policies that create a supportive regulatory environment and analyzes how FDA initiatives may impact domestic manufacturing investment and success.

Brief Manufacturing Overview

Pharmaceutical manufacturing is the process of turning a scientific discovery into medicine that can be reliably produced and distributed for use by patients. Previous American Action Forum work outlines the general steps of the manufacturing process, including key actors – from suppliers to researchers to manufacturers to regulators.

From ideation to FDA approval, the process depends on several layers of production. The early stages of the manufacturing process include research and development, from drug discovery to development to formulation. Following discovery, clinical trials ensure the safety and efficacy of the product before the drug is approved for commercial manufacturing. Post-market monitoring follows the approval and distribution of a product as the FDA ensures companies are complying with appropriate manufacturing practices and labeling guidelines. The process itself, therefore, does not have an end state; the FDA continuously works to ensure manufacturers and their facilities comply with requisite production rules.

Manufacturers also need clear and consistent guidance from Department of Health and Human Services (HHS) and FDA to operate efficiently. Because of the resource-intensive nature of pharmaceutical manufacturing and the rigorous regulatory framework that governs the industry, both industry and regulators should maximize efficiencies by promoting conditions that support a robust manufacturing process. While many factors affect the viability of a company’s output and facility footprint, some are squarely in the purview of the FDA.

Key Principles to Support Manufacturing

Pharmaceutical manufacturing in the United States produces a range of benefits for public health, the economy, the tax base, and more. The federal government can encourage domestic manufacturing and help maximize these benefits through pro-growth regulatory policies, clarity in decision-making, and communication with industry. Key principles include strengthening supply lines, increasing transparency, a clear inspection regime, and implementing innovative technologies, all of which can help grow pharmaceutical manufacturing capacity.

Strong Supply Lines

The pharmaceutical production process relies on a broad supply chain network, including suppliers, contract manufacturers, packaging operations, as well as access to key starting materials and active pharmaceutical ingredients. Its resilience and flexibility are critical to robust manufacturing. The final product depends on access to necessary materials throughout the manufacturing process, as medicines are never manufactured in a silo. Developing further manufacturer redundancy and adaptability of the broader supply chain may strengthen supply lines and enhance the production process.

Federal regulatory agencies such as the FDA and HHS can strengthen supply chain resilience by responding to product shortages or constraints with expedited approval of new products and authorization of new sources of raw materials. An agency focus on efficient communication will allow the pharmaceutical industry to plan for and create redundancies and enhance the manufacturing process.

FDA’s PreCheck Pilot Program offers the seven selected participants a two-phase process that attempts to accelerate facility approvals and lessen the regulatory burden of operationalizing new pharmaceutical manufacturing facilities. Phase 1 focuses on Facility Readiness, including early engagement with federal experts on facility design, construction, and technical equipment. After Phase 1 objectives are satisfactorily achieved, Phase 2 includes applicable facilities meeting with the FDA to discuss potential issues relating to chemistry, manufacturing and controls (CMC), likely improving the chance of approval by resolving issues prior to drug product submission.

Despite the small initial size of the program, if successful, PreCheck may be a foundation for how the FDA improves supply line flexibility and addresses the regulatory burden it imposes on manufacturers. Industry is optimistic that the pilot program will be successful and may eventually expand to include manufacturers across the health care industry. Future programs may consider how to build off the PreCheck program, by continuing to develop supply chain adaptability policies, including listing limits on the number of participants or expanding the initiative to include health care manufacturers outside of pharmaceuticals.

Transparency

Transparency references manufacturers’ need for the FDA to maintain a clear and predictable regulatory environment. The process of constructing and operationalizing a new facility can take around a decade and cost $2 billion. Opacity may cause manufacturers to struggle identifying not only the appropriate rules, but also the way the FDA will interpret them, increasing compliance costs unnecessarily. When manufacturers and the FDA collaborate under consistent, well-understood expectations, it increases certainty and streamlines the decision-making process.

Communication between the FDA and industry about the manufacturing process occurs in myriad ways. This includes general information for the public as well as product-specific details through draft and official guidance documents, advisory committee meetings, and other stakeholder engagement activities. This communication is very valuable, but effectiveness depends on whether the information exchanged is transparent, actionable, and durable. Increasing transparency could help manufacturers to better understand how decisions are being made, helping solve potential issues efficiently. The goal of a transparent process is to make the decisions more predictable, understandable, and useful.

There are numerous examples of FDA seeking to increase transparency. One is the public release of Complete Response Letters (CRL), the standard communication used to disclose the rejection of a company’s product, explain why, and offer guidance on the changes needed to reapply for future FDA approval. The FDA’s stated objective for releasing CRLs is to “embrace radical transparency,” offering greater insight into FDA decision-making. In July 2025, the FDA announced the release of over 200 CRLs, attempting to increase transparency between manufacturers and the public. Perspectives on the impact of CRL releases are mixed.  Heightened transparency between manufacturers and the public may be beneficial, but releasing sensitive information could potentially breach FDA confidentiality regulations. Plunging into new policy solutions can be disruptive; finding the balance between increasing transparency and protecting manufacturers’ sensitive information will be vital for the FDA. Appropriate redactions can prevent manufacturers from having key details exposed regarding their product application.

Enhancing Inspections

The FDA conducts facility inspections to ensure the production processes are aligned with current Good Manufacturing Practices (cGMP). The cGMP are FDA guidelines that standardize drug safety and quality regulations for manufacturers. Facility inspections continue after a drug is approved and a facility is operational, creating a long-term relationship between industry and the FDA. Enhancing inspection capabilities allows the FDA to ensure better adherence to cGMP. Focusing on more targeted inspections is a key aspect in enhancing standardization across the manufacturing industry.

FDA inspection practices have improved through policies such as the expansion of unannounced site visits at foreign manufacturing facilities. Using unannounced inspections allows the FDA to gather information on global manufacturers and promote public safety by verifying the means of production. The enhancement of inspections can create a more effective regulatory environment, potentially resulting in clear and quicker product and facility decisions from the FDA.

Another change of inspection policy comes with the One-Day Inspectional Assessments pilot program, announced in May 2026. The program aims to expand efficient allocation of agency resources by providing a shortened, targeted facility assessment. One-day assessments will operate as an initial analysis to potentially accelerate a future standard inspection based on compliance. The use of one-day assessments does not mean that additional inspections are unnecessary, although initial findings showed most assessments confirmed compliance with FDA guidelines. These flexible assessments offer an additional tool beyond standard inspections that could enhance effectiveness.

Inspection capacity relies on the number of inspectors employed by the FDA, with consistent staff retention aiding the relationship between the FDA and manufacturers. Maintaining the highest quality standards benefits everyone involved in the health care community, with manufacturers incentivized to engage and work with the FDA to ensure their product is effective and safe for public consumption.

Innovative Technology

The adoption of innovative technology refers to the use of new advancements in tools, systems, and processes, including artificial intelligence to increase overall efficiency in development, production, testing, and supply of medicines. Manufacturers may implement new technologies to operate facilities with increased precision, reduce production inefficiencies, improve quality control, and more effectively respond to supply and demand changes. Innovation is not just implementing new advancements but enriching the use of existing technology, employing new and creative solutions to enhance resilience and efficiency.

The FDA’s Advanced Manufacturing Technologies (AMT) Designation Program is a notable example of how the agency encourages the use of new technology in pharmaceutical manufacturing. The program is a regulatory framework allowing manufacturers to seek designation for strategies using novel technologies, or existing technologies used in novel ways, to significantly improve the manufacturing process. Companies therefore have a clear regulatory mechanism which encourages discussion of advanced production strategies before those technologies are fully incorporated into a specific drug application. The AMT program can be valuable for companies who were once reluctant to invest in advanced manufacturing tools due to uncertainty regarding how the FDA would evaluate them.

If implemented effectively, the AMT program can align regulatory policy with the broader goal of modernizing pharmaceutical manufacturing, offering earlier interaction and more FDA focused feedback. That predictability can encourage investment in more efficient production systems, strengthen supply chains, and help ensure technological innovation translates into better patient outcomes.

Conclusion

Pharmaceutical manufacturing is a high-profile interest for among U.S. policymakers and the wider health care industry, and the FDA is attempting to encourage domestic manufacturing with policy initiatives such as the PreCheck Pilot Program. While there are strengths in the U.S. market, improving the consistency of decisions from federal regulators will provide a stable regulatory environment for manufacturers operating on long-term plans.

A reliable understanding of policy expectations may further investment in the health care community, creating better conditions for domestic pharmaceutical manufacturers. Implementing pro-growth policies that improve transparency, supply lines, inspections, and innovative technology can assist in creating impactful U.S. manufacturing. Additionally, utilizing pilot programs to better understand how to address an issue can be an effective short-term solution, including PreCheck and One-Day Inspectional Assessments. Redundancy of supply lines by manufacturers may minimize supply shortages, better ensuring the demand of a product can remain met through inevitable production complications. The U.S. pharmaceutical manufacturing process can further develop through the support of a consistent regulatory environment and policies improving the potential for success though pro-growth conditions.