President Trump’s proposal to import cheaper prescription drugs from Canada faces significant headwinds from U.S. pharmaceutical companies and the Canadian government.
Canadian officials warn their country is too small to supply their neighbors to the south with prescription drugs, an argument that American drugmakers quickly seized on after years of aggressively opposing all drug importation efforts.
But Trump — eager for a win on drug prices amid the impeachment inquiry and heading into 2020 — is showing no signs of backing off.
Trump recently tweeted that the White House and Department of Health and Human Services (HHS) Secretary Alex Azar “will soon release a plan to let Florida and other states import prescription drugs that are MUCH CHEAPER than what we have now!”
“Hard-working Americans don’t deserve to pay such high prices for the drugs they need,” he added. “We are fighting DAILY to make sure this HAPPENS.”
The Food and Drug Administration expects to release the proposal in January, according to the fall regulatory agenda published last week.
State and federal lawmakers have looked for solutions to high drug costs as prices soar and patients increasingly struggle to pay for their medications. Trump has made lowering drug prices a key goal of his presidency but has made little progress almost three years after taking office.
Under his plan, state governments could seek permission from HHS to import cheaper prescription drugs from Canadian suppliers that meet stringent requirements. Florida, Colorado, Vermont and Maine are in the process of drafting such proposals.
But it’s not clear if the U.S. will find a willing partner in Canada, whose support of drug importation would be crucial for the proposal to take off.
“It is important to recognize that Canada’s market for pharmaceuticals is too small to have any real impact on U.S. drug prices,” Canada’s acting Ambassador to the U.S. Kirsten Hillman said in a statement following her meeting earlier this month with Joe Grogan, Trump’s domestic policy chief.
“Canada’s priority is to ensure a steady and solid supply of medications at affordable prices for Canadians,” she added.
A spokesperson for Health Canada, the agency that runs the country’s health care system, said in a statement to The Hill that it is engaging with U.S. officials to “better understand” the implications of drug importation.
Another big obstacle is the U.S. pharmaceutical industry, particularly the Pharmaceutical Research and Manufacturers of America (PhRMA). The trade group funds the Partnership for Safe Medicines, which lobbies against drug importation.
At an event in Washington, D.C., this month organized by Partnership for Safe Medicines, patient advocates from Canada were invited to attend meetings with staffers for Azar and Senate Majority Leader Mitch McConnell (R-Ky.), where they argued that drug importation would hurt the country’s drug supply.
“We believe that it’s critical for policymakers in the U.S. to hear the perspectives of health care and law enforcement experts, as well as patient advocates from Canada regarding proposals to allow importation of certain medicines,” said Shabbir Safdar, executive director of the Partnership for Safe Medicines, in a statement.
The group recently commissioned a study by a University of Texas researcher, showing that if 20 percent of U.S. prescriptions in 2015 were sourced from Canada, that country’s drug supply would be depleted in 183 days.
Supporters of importation counter that proposals to source drugs from Canada are narrow and would only involve a small number of drugs.
They point to Florida officials who have identified 19 prescription drugs for importation that present the most cost savings, most of which treat HIV. Antiretrovirals used for HIV treatment and prevention are among the most expensive drugs in the U.S., making up 8 percent of all Medicaid drug spending, according to the Kaiser Family Foundation.
“We think it’s a market-based strategy. Canada would have a larger market for drugs and would be able to negotiate with manufacturers for larger market share,” said Trish Riley, executive director of the National Academy of State Health Policy, which is working with the states to develop drug importation plans.
Drug companies have fought against proposals to allow drug importation for decades. While the federal government has had the authority since 2003 to import drugs, it has never implemented an importation program.
But as the idea moves closer to reality, drug companies have increased their efforts in Canada to push officials there to block it.
“The pharmaceutical industry enjoys very high prices in the U.S. — much higher than in other countries,” Riley said. “They have moved their advocacy from this country, where laws are being enacted, and moving it to Canada to try to scare Canada.”
PhRMA, which opposes drug importation, spent $6.2 million on lobbying in the third quarter of this year, according to federal disclosures. Drug companies like Amgen, Genentech, Bayer, Sanofi and Eli Lilly also lobbied on drug importation in the third quarter.
Canadian stakeholders have primarily argued that the country already has challenges meeting demand in Canada. Those concerns are not unfounded, experts say.
“Canada is a much smaller country on a population basis,” says Rachel Sachs, a drug regulation expert and associate professor at Washington University in St. Louis.
“If a few busloads of Americans purchase insulin, that’s one thing. Advancing a policy on a national level or many different states looking into this, very quickly you could get into potential shortages in Canada,” she added.
Fifteen Canadian organizations, some which receive funding from drug companies, warned about drug importation in a letter to Prime Minister Justin Trudeau earlier this month.
“If people in the U.S. think there’s a problem with drug prices in the U.S., with all due respect, Canada didn’t create that problem. It’s a made in America problem that needs a made in America solution,” said John Adams, chair of the Best Medicines Coalition, one of the groups that signed the letter and receives funding from the pharmaceutical industry.