Pharma lobby, Trump administration clash over drug importation

THE TRUMP ADMINISTRATION launched another political grenade at pharma interests last week, announcing an incremental plan to allow for drug importation.

HHS Secretary Alex Azar and acting Food and Drug Administration Commissioner Ned Sharpless said they plan to move forward with two regulatory proposals. One would authorize states, wholesalers or pharmacists pilot programs that import Canadian versions of certain FDA-approved drugs.

The other would give drugmakers a way to start negotiating new distribution contracts in order to sell their lower-priced foreign versions of a wide swath of drugs, including biologics like insulin and arthritis medication. They didn’t lay out a timeline, other than that the agencies plan to move quickly in the face of some strong opposition.

“The administration’s importation scheme is far too dangerous for American patients. There is no way to guarantee the safety of drugs that come into the country from outside the United States’ gold-standard supply chain,” Pharmaceutical Research and Manufacturers of America CEO Stephen Ubl said in a statement. “Law enforcement has repeatedly warned that importation schemes could worsen the opioid crisis and jeopardize public safety. Moreover, Canadian officials have said that the policy is unworkable, and they will not risk shortages by diverting their medicine supply.”

High drug prices are leading the polls as a concern of voters, according to Republican congressional aides, and the administration has faced a series of setbacks this summer over its regulatory strategy to lower costs. In the Senate, GOP lawmakers are dragging their feet on White House-endorsed legislation.

The two strategies leave many questions unanswered until the logistics are worked out through a proposed rule. The second regulatory idea, for instance, doesn’t make room for biosimilars competing in Europe with AbbVie’s Humira—which holds the U.S. market for arthritis medication until 2023. This policy would also rely on manufacturers to use a new national drug code in order to sell their cheaper foreign version in the U.S. if they can’t get out of supply chain contracts with their existing code for the drug.

Azar said the idea came out of conversations with manufacturers about the “perverse incentives” in the supply chain. As to whether the guidance will put enough pressure on manufacturers to lower their U.S. list prices, Azar punted to the rulemaking process.

“That’s why we’ll be going through good guidance practices, to make sure we implement the system to achieve the objective,” Azar said during a media briefing. In terms of the overall plan, Azar said he hasn’t discussed it with pharmaceutical industry representatives.

Health system pharmacists echoed PhRMA’s concerns that importation won’t move the needle on pricing, as well as concerns around product safety.

“Policymakers should focus on workable solutions that lower costs, such as increasing generic competition and eliminating costly fees imposed by PBMs,” Tom Kraus, of the American Society of Health-System Pharmacists, said in a statement.

Azar and Sharpless acknowledged there are other hurdles, including Canada’s willingness to send its drugs to the U.S. Some Canadian pharmacy groups have decried the plan and Azar indicated it will largely be up to the states and wholesalers to broker relationships.

He added that supply chain questions will be addressed in the notice of proposed rulemaking.

“There are hurdles of course, but the hurdles now are known, and they are surmountable, we are making that clear,” he said, adding, “We’re open-minded, and we’re open for business.” ●

“There are hurdles of course, but the hurdles now are known, and they are surmountable, we are making that clear. We’re openminded and we’re open for business.”

Alex Azar HHS secretary