Monday, May 20

The FDA will issue the first approval for mass imports of drugs into the states from Canada

The Food and Drug Administration has allowed Florida to import millions of dollars’ worth of drugs from Canada at much lower prices than the United States, ignoring decades-long fierce objections from the pharmaceutical industry.

The approval, released Friday in a letter addressed to Florida, represents a major policy shift for the United States, and advocates hope it is a significant step forward in the long and largely unsuccessful effort to bring drug prices under control. Individuals in the United States can purchase directly from Canadian pharmacies, but states have long wanted to be able to purchase drugs in bulk for their Medicaid programs, government clinics and prisons from Canadian wholesalers.

Florida estimated it could save up to $150 million in the program’s first year by importing medicines for HIV, AIDS, diabetes, hepatitis C and psychiatric conditions. Other states have asked the FDA to establish similar programs.

But significant obstacles remain. Some drug manufacturers have agreements with Canadian wholesalers not to export their drugs, and the Canadian government has already taken steps to block the export of prescription drugs that are in short supply.

“Canada’s drug supply is too small to meet the demands of both American and Canadian consumers,” Maryse Durette, a spokeswoman for Health Canada, wrote in an email. “Importing large quantities will not provide an effective solution to the problem of high drug prices in the United States”

The drug industry’s main lobbying organization, the Pharmaceutical Research and Manufacturers of America, or PhRMA, which has sued over previous importation efforts, is expected to file a lawsuit to block Florida’s plan. In a statement Friday morning, PhRMA called the FDA’s decision “reckless” and warned that it was “considering all options” to prevent it from going into effect.

Congress passed a law allowing drug importation two decades ago, but federal health officials have delayed its implementation for years, citing safety concerns, one of the main arguments drug companies have used against it. In 2020, President Donald J. Trump pushed the law forward, announcing that states could submit import proposals to the FDA for review and authorization. President Biden gave further impetus the following year, directing federal officials to continue working with states on import plans.

Florida applied and later sued the FDA, accusing the agency of what Gov. Ron DeSantis called a “reckless delay” in approving the request. Friday’s announcement grew out of that lawsuit; a federal judge had set a Jan. 5 deadline for the FDA to act on the state’s request.

Dr. Robert Califf, the FDA commissioner, said in a statement that the agency will review additional state requests to make sure they measure up to the program’s goals.

“These proposals must demonstrate that the programs would lead to significant cost savings for consumers without adding the risk of exposure to unsafe or ineffective drugs,” Dr. Califf said.

Eight other states – Colorado, Maine, New Hampshire, New Mexico, North Dakota, Texas, Vermont and Wisconsin – have laws allowing a state drug importation program, and many are seeking, or planning to seek, FDA approval.

Colorado’s application is pending with the FDA. New Hampshire’s request was denied last year. Vermont’s was deemed incomplete; a spokesperson said the state was waiting to see how the FDA handled requests from other states before resubmitting them.

Colorado officials have signaled that states may face challenges from drug makers in Canada, including familiar names like Pfizer, Merck and AstraZeneca. Some drugmakers have contracted with pharmaceutical shipping companies that prohibit deliveries to the United States, Colorado officials said in a report.

Drug importation enjoys broad political and public support. A 2019 survey by KFF, a non-profit health research group, found that nearly 80% of respondents favored importation from licensed Canadian pharmacies.

“Importation is an idea that resonates with people,” said Meredith Freed, senior policy analyst at KFF. “They don’t fully understand why they pay more for the same drug than people in other countries.”

With the 2024 presidential election on the horizon, candidates are trying to claim credit for efforts to reduce drug prices. President Biden is highlighting the Inflation Reduction Act, which authorizes Medicare to negotiate prices directly with drug manufacturers for the first time, but only for a limited number of high-cost drugs. DeSantis, who is challenging Trump for the Republican nomination, is touting his import plan.

“We have a warehouse ready and the state will save hundreds of millions of dollars because I can buy the same drug there at a fraction of the cost, then it gets relabeled in Florida, and then it goes out of there,” DeSantis said Friday during a campaign stop in Iowa.

Several drug policy experts said importing from Canada would not solve the root cause of high drug prices: drugmakers’ ability to fend off generic competition by gaming the patent system and the federal government’s broad failure to negotiate directly with pharmaceutical manufacturers on costs. .

“It seems like political theater to me, where everyone wants to say they did something to lower the price of prescription drugs,” Nicholas Bagley, a health law expert at the University of Michigan Law School, said of Florida’s plan.

Both Mr. Bagley and Dr. Aaron Kesselheim, a professor of medicine at Harvard Medical School, said the Inflation Reduction Act is a more direct path to lower prices; The provisions of the Price Negotiation Act are expected to save the federal government approximately $98.5 billion over a decade. Drug makers are suing to prevent those provisions from taking effect.

With approval in hand, Florida still has a lot of work to do. Before the state can distribute Canadian drugs, it must send the FDA details of those it intends to import. The state must ensure that drugs are potent and not counterfeit. It must also place FDA-approved labels on drugs instead of those used in Canada.

The FDA said it will watch to see whether the state complies with safety regulations – such as reporting any side effects of drugs – and provides significant cost savings to consumers. Florida’s import approval lasts two years from the date the drug is first shipped.

In Canada, health officials have been wary of the push for imports from their country. In November 2020, shortly after the Trump administration announced that states could submit import proposals, the Canadian government published its own rule to prevent manufacturers and wholesalers from exporting certain drugs that are in short supply.

The Canadian government is likely to further restrict exports if they begin to affect Canadians, said Amir Attaran, a law professor at the University of Ottawa. He said the numbers are not enough for a nation of nearly 40 million to supply drugs to a state of 22 million people, much less for 49 other U.S. states.

“If all of a sudden Florida was able to extend the hose of a vacuum cleaner into this country to get what’s in the medicine cabinet, the supply disruption will be in a whole different category,” he said.

Dr. Kesselheim, of Harvard, said FDA authorization was unlikely to make a difference in the price of very expensive brand-name drugs, because manufacturers would prevent wholesalers from exporting the drugs.

“I think it’s going to be difficult for states to import drugs like that on any kind of scale that would make a difference in terms of reducing prices for patients,” Dr. Kesselheim said. Even so, he said, the FDA’s announcement is significant because it puts to rest the idea that importing drugs cannot be done safely.

Bagley of the University of Michigan said there is a simpler solution to high drug prices than state import programs: have the U.S. government negotiate with drug companies over prices, just as many other nations do, including Canada .

“This whole thing is a rigged and complicated approach to a problem that may be amenable to a pretty simple solution, which is to give the government the power to bargain over drug prices,” he said. “So instead we are trying to take advantage of the mechanism that Canada has created and that we have been too timid to create.”

Molly Longmann contributed reporting from Cumming, Iowa.