This year, legislators in Colorado, Oklahoma, Utah, Vermont, and West Virginia introduced bills to allow licensed wholesalers to import medicines from Canada and distribute them to pharmacies and health plans within their states.
The bills are the first of their kind and their sponsors say they would reign in escalating prescription drug costs.
Canada, which has a single-payer healthcare system, negotiates drug prices with manufacturers. Brand-name medications are between 40 to 60 percent cheaper than in the United States, according to Express Scripts, a large pharmacy benefit manager.
“We have a lot of people who are strapped and cannot afford life-saving drugs,” Rep. Norm Thurston (R-Utah), who sponsored his state’s bill, told Healthline. “They become desperate and go without their drugs or sacrifice something else, and that’s not good for our population.”
Arguments for and against
The five state bills are based on model legislation from the National Academy for State Health Policy (NASHP), an organization of state policymakers.
“It’s pretty clear that there is not going to be meaningful, comprehensive federal action to bring down the high cost of drugs, so the states want to experiment in as many ways as they can,” Trish Riley, NASHP’s executive director, told Healthline.
Colorado’s legislation died in committee, but the rest of the bills are still alive, with Utah’s bill the furthest along in the political process.
On Wednesday, the Utah bill passed the state House of Representatives in a 39-31 vote. It now goes to the state Senate for consideration.
“I’m ecstatic to have this move forward,” said Thurston. “It sends a message that we actually care about real-world problems of our constituents more than the heavily financed lobbyists from the drug industry.”
U.S. drug makers strenuously oppose any state plan to allow the importation of medicines from Canada.
“The proposals we are seeing in states across the country threaten the safety of patients and families and will not deliver the savings they promise,” Priscilla VanderVeer, a spokesperson for the Pharmaceutical Research and Manufacturers of America (PhRMA), told Healthline in an email.
Importation schemes “open new avenues for unscrupulous organizations and individuals to take advantage of American patients in ways that are irresponsible and dangerous,” said VanderVeer. “The proposals would exacerbate the influx of deadly and counterfeit drugs.”
Both Riley and Thurston, however, said that’s not the case.
“Most of the PhRMA opposition that we have seen is citing studies about personal importation of drugs from overseas,” Riley said. “So they are making an apples and oranges comparison.”
What the state laws would do
Most experts concur that there’s a legitimate concern that individuals who directly purchase drugs from other countries through online, unregulated pharmacies risk receiving medicines that are contaminated, substandard, fake, improperly stored, or mislabeled as to the country of origin.
But these five state bills wouldn’t authorize individual purchases of foreign-sourced drugs. Instead, the laws would set up a regulated wholesale operation.
Each state law varies, but in general, the health department or some other agency would authorize one or more licensed wholesalers to purchase a limited list of drugs from a state-selected, licensed Canadian supplier.
The medications must have been approved for sale to Canadian consumers by Health Canada, the equivalent to the U.S. Food and Drug Administration (FDA). They would also have to be identical to FDA-approved drugs.
The approved wholesaler in the state would then sell the medications to retail pharmacies, private health plans, state prisons, and the state Medicaid program, who would then pass the bulk of the savings onto consumers, explained Riley.
But before any import program could become active, federal law stipulates that the Secretary of the U.S. Department of Health and Human Services (HHS), which oversees the FDA, would have to certify that the program is safe and results in significant cost savings to consumers.
“We do not comment on state laws,” Lyndsay Meyer, an FDA spokesperson, told Healthline when asked about the state proposals.
Instead, Meyer emailed a list of the FDA’s concerns about the safety of individual importation of medicines.
Meyer also pointed out that no HHS secretary has ever certified that importing drugs from overseas is safe and saves cost.
In 2010, then-U.S. Senator Byron Dorgan of North Dakota asked for approval of a proposed pilot program to sell cheaper prescription drugs from Canada to his state residents.
In 2012, then-Montana-Gov. Brian Schweitzer proposed a similar pilot program for his state.
Neither plan came to fruition.