Vermont to advise feds on plan to import Rx drugs from Canada

Published: 11/29/2019 10:14:02 PM
Modified: 11/29/2019 10:13:53 PM

Vermont is sending its plan to import prescription drugs from Canada to the federal government.

Gov. Phil Scott, along with state health care officials, announced at a news conference Tuesday that the state will submit a “concept paper” to the Department of Health and Human Services and the U.S. Food and Drug Administration, which may help influence the country’s policy on buying prescription medication from Canada.

Scott described the submission as a kind of unsolicited advice. The federal government didn’t ask for the paper and likely wouldn’t give the state feedback on its plan.

But officials said it could help shape new rules that would allow Vermont and other states to import drugs from over the northern border. Currently, the practice is prohibited under federal law.

“It’s important to do what we can and to do it in a public way,” Scott said. Vermont’s small size “allows us to be nimble, and coupled with our proximity to Canada, puts us in a position to be a leader on this policy.”

Vermont will submit its formal application to allow the state to buy drugs from Canada by next July.

The submission is part of the state’s efforts to lower the cost of prescriptions, which has become a talking point at both the state and national levels. Scott signed a bill into law in May 2018 asking the Agency of Human Services to create an importation program between the state and Canada.

“Importing drugs from Canada is an opportunity to lower the cost of prescriptions for Vermonters and is a priority,” said Mike Smith, secretary for the Agency of Human Services.

Under the plan, Vermont would license wholesalers, which would buy name-brand drugs in bulk. Vermonters would be able to purchase the drugs at a lower rate and would save money through lower insurance premiums, deductibles or reduced copays for prescription drugs.

Earlier this year, the state identified 17 drugs that would be cheaper if imported from Canada, including medicines to treat diabetes, cancer and HIV/AIDS. Insurance companies attributed their requests for double-digit rate increases in part to rising prices of prescription prices. Vermont could save between $1 million and $5 million in the program, said Ena Backus, director of health care reform for AHS.

The plan could reap between $2.61 and $2.82 per member per month, according to the most recent estimates.

Backus said the agency is working on more current savings estimates. They’re also asking federal agencies to allow insulin from Canada, which is currently prohibited as a “biologic” drug.

Since Vermont’s 2018 vote, Florida and Colorado have also passed similar laws. In August, Florida submitted a similar concept paper, though their plan would be limited to publicly funded insurance. Vermont would focus on commercial insurers but allow Medicaid the option to participate as well.

In July, the Trump administration announced that it would start the process to allow states to buy pharmaceuticals from Canada.

But there’s no guarantee it will work. Lobbyists from the pharmaceutical industry have opposed the move, arguing that there’s not enough supply and that there’s no way to ensure that Canadian drugs are safe.

According to the concept paper, Canadian manufacturers would have to be approved by the FDA. The FDA also would be allowed to examine the drugs at the border.

Canadian officials have voiced reservations, noting that their supply is too small to drive down prices and worrying that it would raise prices for their residents.

The chance to buy medicine from Vermont’s northern neighbor is likely years away. The federal government must create rules for the program, and then must approve Vermont’s application to participate.

If the federal government approve Vermont’s application, the state legislature must also vote to implement the program.

In spite of the questions that remain, Vermont’s input increases the likelihood federal officials would move forward as promised, according to Scott.

“We remain optimistic of their commitment to address the high cost of pharmaceuticals,” he said.

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