Four former U.S. Food and Drug Administration (FDA) commissioners have asked President Donald Trump not to pursue importing prescription drugs from foreign countries as a strategy for lowering drug costs.
Drug importation would pose “serious risks to patients and consumers,” allow unsafe and fake drugs to enter the U.S. market, and yield only minimal cost savings, states the letter signed by medical doctors and former FDA Commissioners Robert Califf, Margaret Hamburg, Mark McClellan, and Andrew Von Eschenbach.
A “Healthcare Reform” paper distributed by Trump’s presidential campaign in 2016 stated, “Allowing consumers access to imported, safe and dependable drugs from overseas will bring more options to consumers.”
Grace-Marie Turner, founder and president of the Galen Institute, says foreign drug merchants could deceive U.S. patients about the sources of imported drugs.
“[Drugs] look like they’re coming from Canada, when in fact they may be coming from Bangladesh,” Turner said. “It may look like a perfectly legitimate website, with the Canadian [maple] leaf, for example, and very reputable addresses, but when you go there, you realize, ‘My goodness, there’s nobody there.'”
Studies conducted under McClellan in 2002 through 2004 found imported drugs could contaminate the U.S. supply, Turner says.
“Something like 80 to 85 percent did not meet FDA standards,” Turner said. “They were contaminated, they didn’t have the active ingredient, [and] they were mislabeled.”
Peter Pitts, president of the Center for Medicine in the Public Interest and a former FDA associate commissioner, says political messaging has promulgated the myth U.S. patients would benefit from foreign countries’ price controls.
“You envisage old ladies, senior citizens on buses going to Canada to get their drugs,” Pitts said. “These days, if you are signed up for Medicare and have the Part D drug benefit, your unpatented innovator drugs are less expensive in the U.S. than they would be if you bought them retail in Canada.”
Turner says importing drugs would generate negligible cost savings.
“The Department of Health and Human Services did an analysis of how much people actually save from importing drugs from abroad, and it was less than 1–2 percent. So, the risk to individuals and to our drug supply is huge for almost no savings,” Turner said.
Coercion by Foreign Governments
To bring one new drug to market, the average company invests $2.6 billion over 15 years, a study by the Pioneer Institute found in 2014.
Foreign governments coerce U.S. pharmaceutical companies to sell new drugs at a steep discount by threatening to use counterfeits instead, Turner says.
“Government is a big buyer of many of these drugs,” Tuner said. “They basically tell the pharmaceutical companies, ‘You must sell us your drugs at a price that we are demanding, or we’re not going to buy them, and then we will say that you basically have abandoned your patent, and we will create our own copies of those drugs.'”
In such cases, drug companies essentially must give away their product to keep their intellectual property, Turner says.
“In order for pharmaceutical companies to protect their patent, they really are held over a barrel: Either sell at oftentimes a ridiculously low price or their patents are going to be stolen from them,” Turner said.
Patients Pay the Difference
The foreign governments’ price controls would prove cost-prohibitive if replicated in or imported to the United States, Turner says.
“If governments impose price controls, however they are disguised, the resources would soon dry up for companies to develop new drugs based upon their innovative research,” Turner said. “Price controls generally mean that companies barely recoup their manufacturing costs, much less their investment of an average of $2.5 billion in bringing a new drug to market.”
Pitts says foreign drug companies’ reliance on pharmaceutical research paid for by U.S. companies is costing U.S. patients.
“If they would accept a more legitimate, more equitable share of the overall investment, we would be paying less, they would be paying more,” Pitts said. “And then also think about what the right thing to do is. I think placing the burden of research and development squarely on the back of the American consumer is certainly not the right thing to do.”
Art of the Deal
The Bipartisan Congressional Trade Priorities and Accountability Act of 2015 requires the U.S. government to “reduce or eliminate existing tariff or nontariff barriers … unduly burdening and restricting U.S. trade,” as an objective of trade negotiations, according to a summary of the law by the Congressional Research Service.
Turner says Trump could help alleviate rising health care costs for Americans simply by enforcing current law.
“The intellectual property of drug developers is part of trade agreements,” Turner said. “We want more competition, but you want sensible regulation, and you want the government to do one of its constitutional obligations, and that is to protect intellectual property rights.”
Pitts says Trump should use his negotiation skills to get U.S. drug companies and patients fair prices in foreign markets.
“[Trump] has presented himself as the great negotiator,” Pitts said. “He knows how to get deals. Let’s take him at his word and say, ‘Get out there and tell our allies that they have to carry their fair share of drug development costs.’ That simply can’t fall on American patients.”
Jordan Finney ([email protected]) writes from Boise, Idaho.
Robert M. Califf, et al., “Four FDA Commissioners Write Letter to Trump on Drug Importation,” March 16, 2017.
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