The VA's Critical Role in the U.S.-China Biotech Race

By David Shulkin

July 29, 2026

Biotechnology is rapidly becoming a cornerstone of national power. The nation that can efficiently discover, test, and deploy new therapies will not only enhance the health of its citizens but also shape global standards, attract investment, and strengthen military readiness. China has recognized this and is aggressively investing in biotechnology, from artificial intelligence to gene therapies.

Why It Matters

China’s strategic focus on biotechnology is evident in its significant investments and achievements. In 2025, Chinese companies captured nearly half of the global pharmaceutical licensing activity by dollar amount, totaling $137.7 billion. China now conducts more early-stage clinical trials than the United States, according to Clinical Trials Arena. This shift underscores the urgency for the U.S. To maintain its biotechnological leadership.

The bipartisan National Security Commission on Emerging Biotechnology has warned that the U.S. Risks losing its advantage if it fails to act decisively. The commission’s concerns highlight the broader implications of this competition: national security, economic dominance, and global health standards are all at stake.

The VA as a Strategic Asset

The Department of Veterans Affairs (VA) is not just a healthcare delivery system; it is also a critical piece of biotechnology infrastructure. With one of the largest integrated healthcare systems in the world, the VA can significantly shorten drug development timelines through its vast patient base and robust research capabilities.

For instance, the VA’s electronic health records provide an unparalleled resource for clinical data, facilitating faster and more efficient trials. The VA has a strong track record in developing innovative treatments, such as the groundbreaking work on PTSD therapies and personalized medicine. These capabilities position the VA to play a pivotal role in advancing U.S. Biotechnology.

Key Risks

Despite its potential, the VA faces several challenges that could hinder its effectiveness in the biotech race. Funding constraints, bureaucratic inefficiencies, and regulatory hurdles are significant obstacles. For example, the VA’s budget for research and development has remained relatively flat over the past decade, limiting its ability to invest in cutting-edge technologies.

The VA must navigate complex ethical and privacy concerns associated with using patient data. Ensuring that these issues are addressed transparently and responsibly is crucial to maintaining public trust and support.

The Opportunity

The VA’s unique strengths offer a strategic opportunity for the U.S. To regain its competitive edge in biotechnology. By leveraging its extensive patient base, robust research capabilities, and integrated healthcare system, the VA can accelerate drug development and innovation.

To realize this potential, policymakers must prioritize funding and streamline regulatory processes. Public-private partnerships can also play a crucial role by bringing together the resources and expertise of government agencies, academic institutions, and private companies. Such collaborations have the potential to drive significant advancements in biotechnology, benefiting both veterans and the broader population.

Investment Implications

For investors, the U.S.-China biotech race presents both risks and opportunities. The VA’s role as a strategic asset in this competition highlights the importance of investing in biotechnology and related sectors. Companies that can effectively collaborate with the VA and other federal agencies are likely to have a competitive advantage.

However, investors should also be mindful of the regulatory and ethical challenges associated with biotech innovation. Companies that demonstrate a commitment to responsible data use and patient privacy will be better positioned for long-term success.

The VA’s potential as a key player in the U.S.-China biotech race is significant. By addressing funding constraints, streamlining regulations, and fostering public-private partnerships, the U.S. Can leverage this unique asset to maintain its leadership in one of the most critical industries of our time.