Deal Would Entrench CCP-Controlled Supply Chains, Undermine European & U.S. Drug Security
WASHINGTON, D.C. — The Coalition for a Prosperous America (CPA) today warned that Aurobindo Pharma’s proposed $5.5 billion acquisition of Prague-based Zentiva poses an unacceptable risk to Europe’s and America’s pharmaceutical security. CPA is calling on the European Union (EU), including Czech authorities and European Commission competition regulators, to reject the transaction.
Last year, CPA released a groundbreaking report documenting that Aurobindo — an Indian generic pharmaceutical manufacturer that is the largest provider of generic drugs by prescription to the U.S. market — has substantial, alarming ties to Chinese companies sanctioned by the U.S., tied to People’s Republic of China (PRC) military industries, or to human rights violations. This includes ties between Aurobindo and a PRC supplier with documented violations of U.S. pharmaceutical regulations.
“This would be one of the largest pharma acquisitions by an Indian company, but it would be a disastrous mistake for Europe,” said Jon Toomey, President of CPA. “According to Indian regulators and public reporting, Aurobindo is a company mired in corruption scandals, regulatory violations, and deep entanglements with China’s pharmaceutical supply chain. Approving this takeover would place Europe’s drug security at serious risk.”
As first reported by Bloomberg and detailed in CPA’s report, Aurobindo uses at least four Chinese suppliers sourcing from organizations under U.S. sanctions for links to China’s military industry — including Zhejiang Huahai, the company behind the valsartan contamination scandal that caused a major U.S. drug shortage. According to FDA and European Medicines Agency (EMA) reports, Aurobindo has a long record of safety failures, regulatory violations, corruption, and lack of transparency, raising serious legal, quality, and national security concerns. As the largest supplier of generic prescriptions to the U.S., Aurobindo’s competitiveness depends almost entirely on cheap Chinese active pharmaceutical ingredients (APIs), leaving both the U.S. and global medicine supply chains dangerously exposed to Beijing. An Aurobindo takeover of Zentiva would significantly increase that exposure.
Legal & Regulatory Red Flags
Under EU law, competition and merger approvals must weigh the public interest, competition effects, and consumer safety. By these standards, Aurobindo’s record should disqualify it:
- Regulatory Failures: Aurobindo has been repeatedly sanctioned by the U.S. FDA and European Medicines Agency (EMA) for contaminated products, carcinogenic impurities, and systemic manufacturing failures.
- Corruption & Transparency Issues: Indian regulators have linked Aurobindo executives to insider trading, money laundering, and land fraud schemes.
- China Dependence: CPA’s research and a Bloomberg investigation reveal that Aurobindo relies on 55–80% of its raw materials from China — including sanctioned suppliers tied to the Chinese military and human rights abuses in Xinjiang. This reliance on Beijing undermines European sovereignty and U.S. national security.
- Environmental & Labor Concerns: Aurobindo has been repeatedly cited for instances of toxic pollution, worker exploitation, and fatal factory accidents in India, all incompatible with the EU’s ESG and corporate sustainability rules.
A Risk Europe Cannot Afford
Zentiva plays a critical role in supplying affordable medicines across Europe. Handing control of this trusted European supplier to Aurobindo would deepen reliance on adversarial supply chains and expose patients to unsafe production practices at the very moment the EU and U.S. are seeking to diversify away from Beijing.
“This takeover is not just a business transaction — it is a matter of European public health and national security,” Toomey continued. “Prague and Brussels must act in the public interest and block this deal before Aurobindo’s corruption, recalls, and China-dependence become Europe’s problem.”
Implications for U.S. National Security
The proposed takeover is directly relevant to the U.S. Commerce Department’s ongoing Section 232 investigation into pharmaceutical imports. CPA’s submission to the investigation documented how U.S. dependence on Chinese and Indian generics threatens national security, with 20% of critical medicines relying exclusively on Chinese APIs. Aurobindo — already the single largest generic supplier to the U.S. market — would only tighten its grip on global supply chains through acquiring Zentiva.
“As President Trump’s administration moves to reshore U.S. generic drug production, this proposed deal shows exactly why strong Section 232 action is needed,” Toomey added. “The U.S. and our allies must not allow adversary-linked firms like Aurobindo to consolidate more control over essential medicines.”
CPA strongly urges the European Commission, Czech competition authorities, and EU health regulators to exercise their legal authority to block Aurobindo’s acquisition of Zentiva. The EU has a duty to prevent firms with documented regulatory violations, reliance on sanctioned Chinese suppliers, and histories of corruption investigations from consolidating control over essential medicines.
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