Vermont has become the first state to pass a law to allow prescription drugs to be imported from Canada, but the plan still has to be approved by HHS—a tall order considering HHS Secretary Alex Azar’s comments that pharmaceutical imports are a “gimmick” and may be unsafe.
The office of Vermont Gov. Phil Scott, a Republican, confirmed he signed the bill on May 16. It had passed the state’s House and Senate with only two votes in opposition. The law would:
- Create a bulk purchasing program for prescription drugs through the state’s Department of Health.
- Require drugmakers to provide notice before introducing new “high-cost” drugs.
- Use Canadian suppliers approved by that country’s regulatory agencies.
- Limit imports to drugs approved by the U.S. Food and Drug Administration.
- Prohibit imported drugs from being distributed outside Vermont.
“Vermonters are having a hard time paying for medicines and often have to choose between rent or food or prescriptions,” Vermont state Sen. Claire Ayer told HealthExec. “They deserve their state and federal governments’ best work at containing healthcare costs.”
As the law states, certification and approval of HHS would be needed for the plan to move forward. HHS Secretary Alex Azar, himself a former executive for Eli Lilly, has been staunchly opposed to importing drugs from other countries, arguing such policies would allow “unsafe” prescription drugs to enter the U.S. That stance led to U.S. Sen. Rand Paul, R-Kentucky, being the only Republican to oppose his nomination.
He repeated those criticisms when discussing President Donald Trump’s drug pricing blueprint on May 14, calling importing drugs from Canada “a gimmick” which wouldn’t have a meaningful effect on prices.
“They are a lovely neighbor to the north, but they’re a small one,” Azar said. “Canada simply doesn’t have enough drugs to sell them to us for less money, and drug companies won’t sell Canada or Europe more just to have them imported here.”
The drug industry’s biggest lobbying group, Pharmaceutical Research and Manufacturers of America (PhRMA), had harsher criticism of the Vermont plan, saying it would undermine patient safety and “create more avenues for counterfeit drugs to enter the country in the middle of an unprecedented opioid crisis.”
"Lawmakers cannot guarantee the authenticity and safety of prescription medicines when they bypass the FDA approval process, and the Canadian government does not inspect or take responsibility for the legitimacy of prescription medicines shipped to the US,” PhRMA said in a statement. “The burden of combating illicit drugs would fall on local law enforcement officials, who lack the capacity to inspect even a small percentage of increased counterfeit drugs but who have witnessed their impact in communities across the state.”
The bill's sponsors rejected those criticisms. Vermont state Sen. Ginny Lyons told HealthExec she's worried about residents with chronic illnesses which require expensive, ongoing prescriptions to treat being "penalized" if Azar doesn't give the plan his approval.
"I think if he doesn't grant it, when the state does its due diligence in putting forward a comprehensive proposal, it would be extremely irresponsible of him, given his link to the pharmaceutical industry," Lyons said. "It will demonstrate that close link between the administration and big business.
From Vermont’s perspective, the plan would be relatively cheap to implement. The Vermont Legislative Joint Fiscal Office estimated it would take $250,000 in one-time costs to get the importation program up and running.
The law was modeled after legislation written by the National Academy for State Health Policy (NASHP), which said eight other states (Colorado, Louisiana, Missouri, New York, Oklahoma, Utah and West Virginia) considered drug importation bills in their state legislative sessions this year.
“In the absence of federal action to control the cost of prescription drugs, states can’t wait, they need to control drug costs now for all of their citizens,” NASHP executive director Trish Riley said in a statement. “Vermont’s legislature has taken an important step in lowering prescription drug prices that we hope will serve Vermonters well and inform the federal policy debate.”
John joined TriMed in 2016, focusing on healthcare policy and regulation. After graduating from Columbia College Chicago, he worked at FM News Chicago and Rivet News Radio, and worked on the state government and politics beat for the Illinois Radio Network. Outside of work, you may find him adding to his never-ending graphic novel collection.