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Vermont Becomes 1st State to Allow Wholesale Drug Importation from Canada

News  |  By Steven Porter  
   May 16, 2018

Federal officials have expressed opposition to the idea, which still has a long way to go before it can be implemented.

Vermont Gov. Phil Scott reportedly signed a bill into law Wednesday making his state the first in the nation to legalize the wholesale importation of prescription drugs from Canada, despite opposition from federal officials.

Scott, a Republican, took his time studying the measure after state lawmakers sent it his way last week. He signed the bill Wednesday morning, setting the stage for possible conflict with Trump administration officials, as Politico reported, citing a spokesperson for the governor.

Vermont's move comes less than a week after President Donald Trump and Health and Human Services Secretary Alex Azar unveiled a plan to reduce spending on prescription drugs. Importing drugs from Canada is nowhere in the federal plan.

  • Just a stunt? Azar went so far as to call drug importation "a gimmick" on Monday, saying Canada's drug market is too small to fix drug pricing in the U.S. and that importing drugs introduces safety concerns.
  • Industry opposition: The lobbying group Pharmaceutical Researchers and Manufacturers of America (PhRMA), which expressed "serious concerns" about Trump's drug pricing proposals, echoed Azar's safety concerns on importation. "Lawmakers cannot guarantee the authenticity and safety of prescription medicines when they bypass the FDA-approval process, and the Canadian government does not inspect or take responsibility for the legitimacy of prescription medicines shipped to the U.S.," the organization said in a statement, as The Hill reported.
  • A measured measure: Rather than immediately opening Vermont's 90-mile Canadian border to a flood of prescription drugs, the bill simply requires the state to put together a design plan by the end of the year and submit a formal request by July 2019 to HHS, which would need to certify the state's program.
  • Model legislation: Vermont's bill acknowledges that it was modeled on language proposed by the National Academy for State Health Policy, which says at least eight other states are considering similar proposals.
  • Importation previously permitted: Vermont was previously among several states that allowed individuals to import drugs by having prescriptions refilled by foregin pharmacies as part of the "ISaveRx" program started by Illinois. After running into trouble with regulators, the program ended in 2009, as the Associated Press reported.

Federal officials continued their messaging on price transparency with the unveiling of updated Medicare and Medicaid drug pricing dashboards.

Editor's note: This story was updated Friday, May 18, 2018, to include additional information about Vermont's past participation in the "ISaveRx" program and to clarify that the state's new, first-of-its-kind law seeks to permit wholesale imports.

Steven Porter is an associate content manager and Strategy editor for HealthLeaders, a Simplify Compliance brand.

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