State lawmakers want to allow Vermont to import prescription drugs from Canada, in response to what some of them describe as predatory pricing by the U.S. pharmaceutical industry, but legislators say they’ll need all the help they can get to successfully oppose the drug companies.
Vermont’s federal Congressional delegation — Sen. Bernie Sanders, Sen. Patrick Leahy and Rep. Peter Welch — all back the effort. But even with their combined political clout the outcome remains uncertain.
Currently it’s illegal for Americans to purchase foreign pharmaceuticals for personal use.
Vermont must obtain a federal waiver to import foreign pharmaceuticals on behalf of residents. If granted, it would be the first waiver granted to the state since the 2010 passage of the Affordable Care Act, which included a provision for the loophole in federal law.
Americans currently pay more per capita for prescription drugs than citizens of any other country in the world, and more per capita for healthcare than citizens of any other country. But Americans also have some of the worst health outcomes of any wealthy country, according to studies like the one published this summer by health-care advocacy group The Commonwealth Fund, which placed the United States last for the results of its health-care system among the world’s high-income countries.
President Trump has said he’s in favor of allowing Vermont to import Canadian prescription drugs, Welch told members of the Senate Health and Welfare Committee in a Thursday-morning meeting where he was joined by representatives from Leahy’s and Sanders’ offices.
For the plan to succeed, Vermont would need approval from the U.S. Department of Health and Human Services.
But it’s not clear whether the agency will act in line with Trump’s previous statements, Welch said.
“Early in the Trump administration, [Rep.] Elijah Cummings [D-Maryland] … and I actually met with the president, who in that meeting said he was for importation” of Canadian prescription drugs, Welch said. “He gets it, that importation will put some price pressure on.
“The problem is, since that meeting and that assurance that was given to Congressman Cummings and to me, there’s been no administrative action,” Welch said. The Republican-controlled House committee to whom Welch pitched the idea rejected it, he said.
It’s also not entirely clear to what extent Gov. Phil Scott intends to support the bill, said Vermont Senate President Pro Tem Tim Ashe, D/P-Chittenden.
A key piece of the proposed drug-importation law authorizes Vermont officials to negotiate drug prices. Although both Scott and Trump have sought to remove government restrictions on commerce, the last time their party controlled all three branches of the federal government Republicans adopted a law forbidding the federal government from negotiating drug prices.
Citizens in every other wealthy country secure cheaper drugs by directing their governments to negotiate low prices from pharmaceutical companies, Ashe said.
Ashe nevertheless said the issue isn’t a partisan or ideological one. “People on both sides of the aisle want cheaper [prescription] drugs,” he said.
Scott’s spokeswoman, Rebecca Kelley, said in an email that the governor does support cheaper prescription drugs, and said that he’ll support the bill if it accomplishes that while complying with federal law.
But whatever Republican leaders in state and federal government choose to do, the pharmaceutical industry will certainly oppose the law — and forcefully, Ashe said.
There’s a lot at stake for drug companies — just five pharmaceutical companies last year made $50 billion in profits, said Kathryn Becker Van Haste, Sen. Sanders’ health policy director.
Although one in every five Americans can’t afford the drugs these companies sell, and although 71 percent of Americans support importation of pharmaceuticals from Canada, Van Haste said, it’s the drug companies who have the ear of the current Congress, and, seemingly, the presidential administration as well.
The current secretary of the U.S. Department of Health and Human Services could, under existing law, promulgate regulations authorizing states to import drugs from Canada, Van Haste said. Trump and his administrators have chosen not to.
“I spoke earlier to that $50 billion in profits: it can give you some sense of perhaps why those regulations have not ever been promulgated,” Van Haste told Vermont legislators Thursday.
Sanders has introduced a bill that would require the HHS to begin the process of writing regulations allowing Canadian pharmaceutical imports, Van Haste said.
Sanders, Welch and Leahy all affirmed Thursday morning, either personally or through representatives, that they’ll do what they can to secure this permission.
“At the proper time… the delegation will be very supportive in trying to assist with whatever it takes to be able to get the federal waiver,” said John Tracy, Leahy’s Vermont state director. “We cannot guarantee success.”
State legislators expressed similar uncertainty over their ability to prevail against an industry that enjoys a great deal of influence with the current Congress and administration.
“We’re going to need all the help we can get,” Sen. Claire Ayer, D-Addison, chair of the Senate Health and Welfare Committee.
That’s true, Ashe said.
“Nothing will be easy,” he said. “There’s just no question. Every strategy will be hard, because of the tactics of the drug companies, which are comprehensive and aggressive.”
Drug companies will seek to portray Canadian drugs as unsafe, Ashe said, and they’ll try to scare Americans into supporting their existing model.
The trade group Pharmaceutical Research and Manufacturers of America did just that in an emailed statement supplied in response to a request for an interview.
“This legislation would threaten the safety of Vermont’s patients and their families,” wrote Caitlin Carroll, the group’s communications director. “It is a myth that purchasing prescription drugs from online Canadian pharmacies is a safe alternative to FDA-approved medicines. In fact, medicines sold through Canadian websites can originate anywhere and the Canadian government does not inspect or take responsibility for the legitimacy of prescription medicines shipped to the U.S.”
Carroll also said that “local law enforcement officials” would be forced to verify that imported pharmaceuticals aren’t counterfeit, and said the bill would exacerbate an influx of “counterfeit fentanyl, that is overwhelming local communities and generating a public health crisis.”
But Vermont law enforcement authorities and health officials have blamed actual fentanyl, and not fake fentanyl, for contributing to an opioid crisis within the state and nationwide.
The bill in question doesn’t allow the purchase of pharmaceuticals through “Canadian websites” or “online Canadian pharmacies.” Rather, it would establish a wholesaler within Vermont that would purchase wholesale Canadian pharmaceuticals and re-sell those drugs inside Vermont’s borders.
All Canadian pharmaceuticals are subject to the same oversight and the same standards as American drugs, said Sarah Dione-Marquis, director of media and public relations for the trade group equivalent to PhRMA in Canada, called Innovative Medicines Canada.
Prescription drugs must meet standards set by Health Canada, said Jeff Connell, vice president of corporate affairs for the Canadian Generic Pharmaceutical Association. “Health Canada is our FDA,” Connell said.
Finally, the bill allows establishment of a Vermont pharmaceutical importer only if the drugs imported from Canada meet American safety standards, said Sen. Virginia “Ginny” Lyons, D-Chittenden. The bill stipulates as well that a Vermont pharmaceutical wholesaler may import only those drugs that will realize “substantial” savings for Vermonters, Lyons said.
But the fact that Americans could import pharmaceuticals — many of which were made in the United States, or from U.S. ingredients — from another country, giving the Canadians a cut of the profits while still saving substantial sums off of U.S. drug prices, underscores how costly drugs are in America, Ashe said.
On average, Canadians pay 30 percent less for their pharmaceuticals than Americans do, said Trish Riley, executive director of the National Academy for State Health Policy. Moreover, 80 percent of the ingredients in American-made drugs are already imported, 40 percent of the drugs Americans use are already manufactured elsewhere, and 20 percent of the drugs licensed in Canada are made in the United States, she said.
Ashe said Vermonters should be skeptical of the justifications drug companies make to explain the dramatic differences in pricing.
Drug companies Biogen, Takeda, Boehringer Ingelheim, Viiv, UCB and Shire did not respond to requests for comment.
But in response to a request for an interview, Caroline Pavis, a business unit communications leader for a Johnson & Johnson-owned pharmaceutical company called Janssen, said Americans paid that premium for a wider range of choices and for innovative medicines.
“In the U.S., we have a market-based system that provides financial incentives for innovation while managing access and cost through intense competition, payer negotiations, and the high use of generics,” Pavis wrote in an email. “In other countries, medicine prices are achieved through national regulation, which restricts access to innovative medicines and gives patients fewer choices.”
