The Trump administration is reportedly considering allowing U.S. pharmaceutical companies to maintain most of their licensing agreements with Chinese drugmakers, even as the U.S. tightens restrictions on broader investments in China. According to sources familiar with the discussions, the Treasury Department is drafting rules that would permit American firms to invest in promising Chinese-developed medicines, as long as those projects are not tied to biotechnology or pathogens that could be weaponized. This approach would be less restrictive than what some lawmakers and smaller U.S. biotech companies have advocated, who argue that U.S. investment is helping China gain ground in the global pharmaceutical industry. Licensing deals between U.S. and Chinese biotech firms were valued at $115 billion in 2023, according to research firm GlobalData. These partnerships allow American pharmaceutical companies to access new drugs while also funneling significant capital into Chinese firms. In 2025, nearly half of all U.S. drug licensing deals from overseas involved Chinese companies, and the trend is expected to continue. Major pharmaceutical firms like Pfizer and Bristol Myers Squibb have recently announced large-scale collaborations with Chinese biotech companies, with deals worth up to $10.5 billion and $15.2 billion respectively. Pfizer CEO Albert Bourla has spoken with U.S. officials about the balance between China investment and national security, arguing that licensing Chinese-developed medicines does not pose a threat to the U.S. "I don't think that that's the way to compete with China, to try to slow them down," Bourla said. However, some lawmakers and smaller biotech firms are pushing for stricter controls, warning that continued investment could make the U.S. reliant on China for innovative drugs. Ginkgo Bioworks CEO Jason Kelly has called for restrictions, questioning whether the U.S. is comfortable with such strategic dependence. Republican Rep. John Moolenaar and Democratic Rep. Debbie Dingell are among those pushing for tighter regulations, including the use of the COINS Act, a 2025 law aimed at restricting outbound U.S. investments in certain sectors. They also support legislation that would increase oversight of biotech investments involving Chinese firms. Conversely, Democratic Rep. Jake Auchincloss has argued that restricting U.S. investment in China's pharmaceutical industry is unlikely to succeed, noting that China is heavily investing in biotechnology and has a strong scientific workforce. The final decision on the proposed rules remains pending, with no official announcement expected before Chinese President Xi Jinping's upcoming meeting with Trump.