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Trump Approves Final Plan to Import Drugs From Canada ‘for a Fraction of the Price’

(Chris Kleponis/Polaris/Bloomberg via Getty Images)

President Donald Trump, outlining his “America First Health Plan” on Thursday, announced that his administration will allow the importation of prescription drugs from Canada.

The final plan clears the way for Florida and other states to implement a program bringing medications across the border, despite the strong objections of drugmakers and the Canadian government.

But it does not allow states to import biologic drugs, including insulin.

Florida, the biggest swing state in the presidential election, is one of six states to pass laws seeking federal approval to import drugs. Trump’s announcement came the same day counties in Florida began sending out vote-by-mail ballots.

Florida Gov. Ron DeSantis, a close ally of the president’s, is a strong advocate of importing drugs. His administration has already advertised for a contractor to run the state program and is expected to announce Tuesday which companies have bid for the three-year, $30 million state contract.

Congress has allowed drug importation since 2003 but only if the secretary of the Department of Health and Human Services certified it is safe. That had never occurred until Secretary Alex Azar did it Wednesday, according to a letter he wrote to congressional leaders.

Implementation under the administration’s final rule “poses no additional risk to the public’s health and safety and will result in a significant reduction in the cost of covered products to the American consumer,” Azar said in the letter KHN obtained Thursday.

The rule noted, however, that HHS is unable to make any estimates about savings because it doesn’t know which drugs will be imported.

Prices are cheaper north of the border because Canada limits how much drugmakers can charge for medicines. The United States lets the free market dictate drug prices.

Even though insulin is not included among the drugs covered by the rule, the Trump administration Thursday issued a request for proposals seeking plans from private companies on how insulin could be safely brought in from other countries and made available to consumers at a lower cost than products here. The request specified it would have to be insulin that was once in the United States and sent to other nations before being brought back.

The pharmaceutical industry has long fought efforts on drug importation, arguing that it would disrupt the nation’s supply chain and make it easier for unsafe or counterfeit medications to enter the market.

“We are reviewing the final rule and guidance that were released; however, we continue to have grave concerns with drug importation that exposes Americans unnecessarily to the dangers of counterfeit or adulterated drugs,” said a spokesperson for the Pharmaceutical Research and Manufacturers of America, an industry trade group. “It is alarming that the administration chose to pursue a policy that threatens public health at the same time that we are fighting a global pandemic.”

Drugmakers have suggested in the past that they might try to stop such a policy through a lawsuit.

Trump has dangled his drug importation plan in campaign speeches over the past year — and again on Thursday in North Carolina during a speech that provided a litany of his promises on health care.

“We will finally allow the safe and legal importation of drugs from Canada,” Trump said. States “can go to Canada and buy your drugs for a fraction of the price” in the U.S.

“This will be a game changer for American seniors,” Trump said. “We’re doing it very, very quickly.”

The administration proposed the regulation in December. The final rule says it takes effect in 60 days.

But individuals will not be allowed to import drugs on their own, Azar said in his letter. Instead, they will have to rely on programs run by states.

Nonetheless, officials said they are interested in studying options for consumers to benefit from importation. The administration Thursday issued another request for proposals to set up a system that would allow U.S. consumers to import drugs through local pharmacies, a senior HHS official said Friday on a call with reporters.

For decades, Americans have been buying drugs from Canada for personal use — either by driving over the border, ordering medication on the internet or using storefronts that connect them to foreign pharmacies. Though the practice is illegal, the FDA has generally permitted purchases for individual use.

About 4 million Americans import medicines for personal use each year, and about 20 million say they or someone in their household has done so because prices are much lower in other countries, according to surveys.

The practice has been especially common in retiree-rich Florida, where more than a dozen stores help consumers make the purchases and where numerous cities, counties and school districts assist employees with the transactions.

The administration envisions a system in which a Canadian-licensed wholesaler buys from a manufacturer of drugs approved for sale in Canada and exports the drugs to a U.S. wholesaler/importer under contract to a state.

Florida’s legislation — approved in 2019 — would set up two importation programs. The first would focus on getting drugs for state programs such as Medicaid, the Department of Corrections and county health departments. State officials said they expect the program to save the state about $150 million annually.

The second program would be geared to the broader state population.

The HHS final rule said the government will “in the future” allow pharmacists to import drugs from Canada, a provision that matches the law approved by Florida in 2019.

But pharmacists in Florida and across the country oppose drug importation, saying they don’t think it will ensure that counterfeit drugs are kept out of the U.S. market.

The Canadian government told HHS last spring that the country doesn’t have enough drugs to spare and that the Trump plan would only worsen shortages of medicines there. It argues that Canada’s pharmaceutical market is too small to have any real impact on American prices. Canada represents 2% of the global pharmaceutical consumption, compared to the U.S.’s 44%.

“We remain focused on ensuring Canadians can access the medication they need,” Cole Davidson, a spokesman for Canada’s Health Minister Patty Hadju, said Friday.

The final rule said state importation programs will have the flexibility to decide which drugs to import and in what quantities.

The rule also makes clear that drug manufacturers will have to provide importers with documentation guaranteeing the medications are the same drugs as those already sold in the United States. HHS could set up regulations that require drugmakers to comply. Importers will have to send drugs to labs to certify their authenticity.

In addition to Florida, the other states seeking federal permission to buy drugs from Canada are Colorado, Maine, New Hampshire, New Mexico and Vermont.

[Update: This story was updated on Sept. 25, 2020, at 11:30 a.m. ET and 4:25 p.m. ET to add information from a Trump administration briefing and a statement from Canadian officials.]

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