08.01.19

US Outlines Plans to Allow Importation of Certain Prescription Drugs From Canada, Other Countries

Source: FirstWord

The US Department of Health and Human Services (HHS) on Wednesday outlined details of two potential pathways that will allow the importation of certain prescription medicines originally intended for foreign markets. The announcement comes the day after HHS Secretary Alex Azar confirmed that President Donald Trump is drafting a proposal to allow the US to import drugs from Canada.  

The proposal comes after a number of US states, such as Colorado and Florida, have passed legislation seeking to permit the importation of drugs from Canada. Meanwhile, officials in Canada argued that the bills could result in drug shortages. 

“For too long American patients have been paying exorbitantly high prices for prescription drugs that are made available to other countries at lower prices,” commented Mr. Azar, adding “today’s announcement outlines the pathways the Administration intends to explore to allow safe importation of certain prescription drugs to lower prices and reduce out of pocket costs for American patients.”  

Under the first pathway, HHS and the FDA would rely on the authority under current federal law to allow pilot projects by states, wholesalers or pharmacists to propose how they would import certain drugs from Canada that are versions of FDA-approved drugs that are manufactured consistent with the US regulator’s approval. Meanwhile, under the second pathway, the FDA would provide recommendations to manufacturers of FDA-authorised medicines who seek to import into the US versions of those drugs they sell in foreign countries.  

HHS noted that under the second pathway, the manufacturer would establish with the FDA that the foreign version is the same as the US version and appropriately label the drug for sale. HHS suggested “this pathway could be particularly helpful to patients with significantly high cost prescription drugs. This would potentially include medications like insulin used to treat diabetes, as well as those used to treat rheumatoid arthritis, cardiovascular disorders and cancer.”  

Acting FDA Commissioner Ned Sharpless stated “we’ve been keenly focused on ensuring the importation approaches we’ve outlined pose no additional risk to the public’s health and safety,” cautioning “we know there are many operational challenges to address through each of these pathways, and are actively working through them as we look to formally announce these policies, with opportunity for public comment, in the coming months.”  

Commenting on the news, Evercore ISI analysts Ross Muken and Michael Newshel stated that a potential implementation of the proposal remains far away because of the technical nature of rulemaking as well as expected challenges to the measure. Meanwhile, Spencer Perlman, director of healthcare research at Veda Partners, noted that the proposal will not have a major effect because of the time required for it to go into effect and its limited scope.  

“While the headline sounds foreboding, in actuality the announcement is quite limited and very likely will have only a relatively small [if any] impact,” Perlman remarked, continuing “bottom line, there’s not a lot of ‘there’ there.”  

The proposal comes after Trump said in June that he was readying an executive order that would limit US drug prices to the same level as those in the country with the lowest prescription prices.  

Meanwhile, a federal judge invalidated an HHS rule requiring drugmakers to reveal the prices of some prescription drugs in television advertisements. The Trump administration also withdrew a separate proposal that would have limited rebates paid by drugmakers to pharmacy benefit managers.

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