On May 25, 2022, the United States Food and Drug Administration (FDA) issued a guidance document intended to help pharmacists and wholesale drug distributors understand and comply with its final rule regarding the importation of certain prescription drugs from Canada. The 2020 final rule, titled “Importation of Prescription Drugs,” implemented Sections 804(b) through (h) of the Federal Food, Drug, and Cosmetic Act (FD&C Act) in an effort to reduce the cost of covered products for US consumers. without compromising public health and safety.
The FDA’s final rule follows recognition of public frustration with the high cost of prescription drugs in the United States. In its Notice of Proposed Rulemaking, the FDA notes that “prohibitive costs” can negatively impact health outcomes, resulting in reduced medication adherence or delayed treatments for patients. In addition, the FDA draws attention to the significant disparity between prescription drug prices in the United States and other developed countries, and the incentive these price differentials create for Americans to seek treatment. overseas or buying drugs from ex-US sources.
According to a University of Florida study in 2020, each year approximately two million Americans buy prescription drugs outside the country. The study found that many purchases are made from international online pharmacies without sufficient regulatory oversight, putting patients at risk of consuming harmful counterfeit drugs and underscoring the need for a legitimate importation pathway.
Federal and state policymakers have long wanted to allow regulated importation of drugs from Canada to help defray prescription drug costs for US consumers. The Medicine Equity and Drug Safety Act (MEDS) Act of 2000 and the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (MMA) contemplated the development of regulations allowing pharmacists and wholesalers to import certain prescription drugs from the Canada, in each case subject to certification by the Secretary of Health and Human Services (HHS) that implementation would 1) pose no additional risk to the health and safety of the public, and 2) result in a reduction significant cost of covered products to the US consumer.
No HHS secretary has been willing to make such a certification – until now. In issuing its final rule, the FDA argues that FD&C Section 804 can be implemented to meet certification criteria through time-limited import programs known as FD&C Import Programs. Section 804 (SIP), which are reviewed and cleared by the FDA and operated by states or certain other non-federal government entities and their co-sponsors. The 2022 guidelines, provided in the form of questions and answers, clarify the procedures for importing prescription drugs and the role of pharmacies and wholesale drug distributors in these programs.
In the guidelines, FDA clarifies eligible entities to submit import program proposals and import eligible prescription drugs (including drug-device combination products). SIPs will be operated by states and Indian tribes (SIP sponsors), subject to FDA review and clearance. SIPs can be co-sponsored by a state, an Indian tribe, a pharmacist or a wholesaler (SIP co-sponsors). In an authorized SIP, the importer of eligible prescription drugs must be either a pharmacist or a wholesale distributor (importer), in each case holding an active license in good standing issued by the FDA or a state that is a sponsor or co-sponsor of SIP.
The final rule contains a number of provisions to ensure the quality of imported products. Pharmacists and wholesalers are only permitted to import eligible drugs identified by the SIP Sponsor for SIP and cleared by the FDA. To be eligible for importation under a SIP, a prescription drug must be approved by the Health Products and Food Branch (HPFB) of Health Canada, have HPFB-approved labeling when is marketed in Canada and, in addition to meeting US labeling requirements, otherwise meet the terms in an FDA New Drug Application or Abbreviated New Drug Application. According to the FDA, “[e]Essentially, qualifying prescription drugs are those that could be legally sold in the Canadian market or in the US market with proper labeling. »
Certain types of pharmaceuticals are categorically ineligible for import under SIPs, including:
- controlled substances;
- drugs subject to a risk assessment and mitigation strategy (REMS);
- Organic Products;
- infused medicines; and
- medicines inhaled or injected into the veins, eyes or cerebrospinal fluid.
Even if a pharmaceutical product is eligible for import, FDA clearance is not guaranteed. A SIP Sponsor must demonstrate that the product can be manufactured, stored and transported safely, free from contamination and sterility and stability issues. The manufacturer or importer must test products for authenticity, degradation and ensure that eligible products conform to established specifications and standards. In addition, product supply chains approved under SIPs must be limited to only three entities: a manufacturer, a foreign seller (i.e. an entity authorized to wholesale drugs by Health Canada and registered with the FDA as a foreign seller) and an importer. Foreign sellers are not permitted to hold an international pharmacy license authorizing the distribution of drugs approved by non-Canadian foreign regulatory bodies.
A SIP can only be authorized for a maximum of two years from the date of its first imported shipment. The FDA can extend the authorization for up to two years at a time. Extensions will likely be provided on a case-by-case basis, subject to FDA review of the SIP and associated supply chain.
Additionally, the final rule stipulates several post-import requirements. After importation under a SIP, SIP Sponsors are responsible for maintaining and providing the FDA with data and information regarding the cost savings of SIP for U.S. consumers and performing any recalls deemed necessary by the FDA or any SIP Participant. Importers have ongoing pharmacovigilance obligations and must submit adverse events, field alerts, and other reports to the FDA and the product manufacturer. In addition, SIP Sponsors and other SIP Participants must also agree to FDA audits and facility inspections as a condition of participating in an SIP.
Although limited to a subset of pharmaceutical products from Canada, the FDA’s final rule is an important step toward disrupting a historically insular market for prescription drugs in the United States. The final rule has the potential to impact drug costs for U.S. consumers, create business opportunities for pharmacists and wholesale distributors, and may pave the way for new imports from other countries. . However, this decision is not without criticism: industry groups have expressed concerns about the potential risks to product quality and safety posed by the opening of the closed drug distribution system in the United States, and d Other associations seem skeptical of the real savings importing will bring to the average US consumer.
The ultimate impact of the FDA’s final rule remains to be seen. For now, stakeholders should refer to the FDA’s guidelines for questions and answers on operationalizing SIPs and be on the lookout for other information from the agency.
For more information
For more information please contact Jamie Ravitz, Georgia Ravitz, David Hoffmeister, Eva Yin, Paul Gadiock, or any other member of Wilson Sonsini’s FDA Regulatory, Health, and Consumer Products practice.