The FDA on Friday approved a plan by the state of Florida to allow direct importation to the state of drugs from Canada, many of which are expected to be at a much lower cost than the same drugs procured in the U.S.
"The FDA may authorize ... proposals from states or Indian tribes to import certain prescription drugs from Canada if the [proposal] will significantly reduce the cost to the American consumer without imposing additional risk to public health and safety," the agency said in a statement. "Florida's obligations under the FDA's regulations will include, among other things: ensuring supply chain integrity, monitoring and submitting adverse event reports, complying with drug recall procedures and reporting quarterly to the FDA."
The proposal, known as a Section 804 importation program, or SIP, "is authorized for 2 years from the date the FDA is notified of the first shipment of drugs to be imported," according to the agency. The FDA requires the state to:
- Submit additional drug-specific information for the FDA's review and approval
- Ensure that the drugs Florida seeks to import have been tested for, among other things, authenticity and compliance with the FDA-approved drugs' specifications and standards
- Relabel the drugs to be consistent with the FDA-approved labeling
- Submit a quarterly report to the FDA that includes information about the imported drugs, cost savings and any potential safety and quality issues
Under Florida's proposal, the state will start importing prescription drugs "in a small number of drug classes which will include maintenance medications to help individuals who have chronic health conditions such as HIV/AIDS, mental illness, prostate cancer, and urea cycle disorder," according to a press release issued by the office of Florida Gov. Ron DeSantis (R). "These drugs will be for individuals who are under the care of the Agency for Persons with Disabilities, Department of Children and Families, Department of Corrections, and Department of Health. The program will then expand to include providing imported prescription drugs for Medicaid members across the state."
"After 3 long years of waiting for FDA approval, we are excited to finally have the opportunity to see this vision come to fruition and provide Floridians access to safe and affordable prescription drugs," Jason Weida, secretary of Florida's Agency for Health Care Administration, said in the release. "As we move forward, we will continue to work every day to find ways to lower costs for Florida's vulnerable populations."
Getting an experiment like this one going is long overdue, according to independent drug industry analyst Marsha Simon, PhD. "It will finally provide a test of the concept after waiting since the Clinton administration," she told MedPage Today in an email. "At base, however, I have always found the concept something of a Rube Goldberg machine. It takes advantage of the lower drug prices that reflect another country's drug pricing policy rather than adopting that policy that produced the lower prices ourselves."
Madelaine Feldman, MD, vice president for advocacy and government affairs at the Coalition of State Rheumatology Organizations, also praised the move -- provided the safety guardrails are effective -- and noted that this type of direct importation of drugs gets rid of the pharmacy benefit managers (PBMs) as "middlemen" between the drugmakers and patients. "Pharma complains that these middlemen increase the price of drugs, which is true; consequently, anything that allows an entity to go around the middlemen is sure to save money," she said in an email to MedPage Today.
"If Pharma is unhappy with this, then they should set up a direct sale without middlemen to the state at lower prices," she continued, adding that drug companies on average give "well over 50%" concessions to PBMs and other middlemen. "They are probably afraid that the PBMs would drop them from their formularies ... Perhaps if enough states go around the middlemen and get the drugs from Canada, maybe Pharma will wake up and drop the middleman and allow states to procure the drugs directly from them," especially for lower-income patients.
However, she added, the proposal "is predicated upon whether Canada will allow a large-scale sale of its drugs to any entity in the U.S., including the state of Florida. Canada does not seem particularly happy about allowing this to happen."
Not everyone was happy about the news. "We are deeply concerned with the FDA's reckless decision to approve Florida's state importation plan," Stephen Ubl, president and CEO of the Pharmaceutical Research and Manufacturers of America (PhRMA), said in a statement. "Ensuring patients have access to needed medicines is critical, but the importation of unapproved medicines, whether from Canada or elsewhere in the world, poses a serious danger to public health. Politicians need to stop getting between Americans and their healthcare. PhRMA is considering all options for preventing this policy from harming patients."
Friday's FDA announcement is an outgrowth of a July 2021 executive order from President Biden to promote competition in the American economy; the order directed the FDA commissioner to "work with states and Indian tribes that propose to develop section 804 Importation Programs in accordance with the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 and the FDA's implementing regulations."