State officials are seeking more time โ possibly as much as an extra year โ to apply to the federal government for permission to import prescription drugs from Canada.
Language inserted in the fiscal year 2020 budget bill approved by the Senate Appropriations Committee on Friday says the Agency of Human Services should submit its federal request no later than July 1, 2020.
Previously, that date was July 1 of this year.
Officials say the delay does not reflect any setbacks in the importation effort, but instead presents an opportunity for Vermont to work with two states โ Colorado and Florida โ that are in the process of approving similar drug programs.
โWe are interested in submitting an application that is as strong as it can be, and we now have additional information to suggest that taking some more time will make the application stronger,โ said Ena Backus, the agency’s director of health care reform.
In an attempt to come up with a novel solution for rising drug prices, lawmakers last year approved a bill that became Act 133. It calls for the state to develop a wholesale program to import cheaper prescription drugs directly from Canada.
The statute says only drugs that meet federal standards for safety and effectiveness would be imported into Vermont. Also, the program would โimport only those prescription drugs expected to generate substantial savings for Vermont consumers,โ the act says.
A report issued by the Agency of Human Services earlier this year showed that multimillion-dollar annual savings may be possible, though the study looked only at two commercial insurers and 17 importation-eligible drugs.
But Gov. Phil Scott has cautioned that it’s not clear whether Vermont’s importation program can get off the ground, in large part because it requires the OK of the U.S. Department of Health and Human Services.
That’s where the latest legislative maneuvering comes in.
On Thursday and Friday, the Senate Health and Welfare Committee heard from Backus and from Trish Riley, executive director of the National Academy for State Health Policy. Both said it makes sense for Vermont to take more time beyond the current July 1 deadline to submit an application to federal officials.
Riley, whose organization has extensively supported Vermont’s work on drug importation so far, said Florida’s Legislature has passed a law regarding Canadian drugs. And she said Colorado is about to do so.
While the states’ legislative initiatives differ, each proposes drug importation and each would require federal approval, Riley said.
โIt’s probably wise for the three states to work together and approach the (federal) administration together,โ she told committee members Friday.
Pooling the states’ resources could increase their political clout. Riley said Florida’s governor is โkeenly interested in this and has spoken with President Trump and the administration, and has a relationship that I think will be important to these discussions going forward.โ
Officials also said a partnership could bring strength in numbers, since more customers could lower drug prices. Vermont has just over 626,000 residents in the latest U.S. Census Bureau estimates, but Colorado has nearly 5.7 million people and Florida has 21.3 million.
โThe value is having a higher population base for what we’re doing,โ said Sen. Ginny Lyons, D-Chittenden and chair of Senate Health and Welfare.
Lyons added that working with other states โdoesn’t mean that our waiver is going to look like everyone else’s, but it might be that there’s some commonality that makes it more attractive (to the federal government) going forward.โ
Representatives of the Vermont Board of Pharmacy also told senators that more time and consultation with other states would be helpful.
As a result, the Senate’s budget bill now says Vermont’s application to the federal government must be submitted โon or beforeโ July 1, 2020. Backus said the administration may not need that much time but is fine with that language โbecause it gives us the flexibility to submit an application sooner โฆ if we are ready.โ
The new legislative language says the Agency of Human Services should continue to work with Riley’s organization and with other states โto identify opportunities to coordinate and work collaboratively in these efforts.โ It also says the agency must give lawmakers an update on drug-importation work by Oct. 1.
Additionally, the bill says the Board of Pharmacy and the Office of Professional Regulation should โexplore whether any new prescription drug wholesaler license categories would be necessary in order to operate a wholesale prescription drug importation program in this state.โ
That licensure question shows that, beyond the federal government’s considerations, there are a lot of unknowns in trying to create a new drug-importation program.
Speaking to the Health and Welfare Committee, Riley also acknowledged that she doesn’t know how much pushback states may get from drug manufacturers. โThe ‘what-ifs’ here are pretty significant,โ she said.
But she also assured lawmakers that international drug suppliers are commonplace.
โForty percent of the drugs we buy today โฆ are made someplace else,โ Riley said. โAnd 80% of the ingredients of those drugs are made someplace else. So it’s already a global market, and I think we are piggybacking on a system that’s in place.โ
