HHS Moves Forward with Prescription Drug Import Plan

The Food and Drug Administration has issued a proposed rule that would allow states to pursue pilot programs to import drugs from Canada and a draft guidance that would allow drugmakers to import their own products and sell them under different drug codes.

Several states are already preparing importation program applications, and Florida and Vermont have submitted concept papers to HHS. Colorado, Maine and Vermont have also passed drug importation laws, and HHS officials have worked with New Hampshire's governor on the regulatory action.

National Academy for State Health Policy Executive Director Trish Riley, who has worked with state officials to develop importation programs, said states will review the specifications outlined in the rules to inform their planning processes.

Patients for Affordable Drugs President David Mitchell supported the move, but called for the administration to push for comprehensive drug-pricing reform in Congress that would help more consumers. "It's not a solution that will lower drug prices for the overwhelming majority of Americans," Mitchell said.

States would not be allowed to import biologics, including insulin, but drugmakers could do so under the second regulatory avenue detailed in the draft guidance, which would allow them to import their own FDA-approved drugs intended for sale in any foreign country, not just Canada. The policy would allow drugmakers to import the medicines under different drug codes, which allows manufacturers to circumvent rebate agreements with pharmacy benefit managers and offer their drugs at lower list prices.

HHS Secretary Alex Azar said drugmakers had asked for a way to offer drugs without rebates. "We will have to see if drug companies live up to it," he said. Azar, a former executive at Eli Lilly, is a well-known opponent of rebates in the prescription drug supply chain, and championed a failed policy to pass all rebates to consumers at the point of sale.

The draft guidance applies only to brand drugs, but HHS will solicit comments on providing guidance on a similar importation approach for generic drugs.

The brand-drug lobby Pharmaceutical Research and Manufacturers of America opposed the move and highlighted that Canada may not go along with the importation plan.

Critics of drug importation have voiced concerns about how imported drugs will comply with track-and-trace standards Congress created to ensure the security of the prescription drug supply chain. Former FDA Commissioner Scott Gottlieb, MD, who now serves on Pfizer's board of directors, said the issues were addressed in the regulatory actions.

"While it may sharply limit who can actually import Canadian drugs under this framework, it maintains critical FDA safeguards to protect consumers," Gottlieb said.

A trade group representing distributors, which could be key players in state importation programs, opposed the plan.

Amid reported tensions between Azar and CMS Administrator Seema Verma, the administration expedited its timeline for releasing the proposed rule and draft guidance. Senate Finance Committee Chair Chuck Grassley, who has long pushed for importation legislation in Congress, commended the administration's actions.