ANNOUNCEMENT 04 Mar 2009

In March 2009, the government of the United States of America announced an alteration to its export prohibitions.

NUMBER OF INTERVENTIONS

1

  • 0 harmful
  • 0 neutral
  • 1 liberalising
Inception date: No inception date

Import ban

The 'Pharmaceutical Market Access and Drug Safety Act of 2009' would amend Chapter VIII of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 381 et seq.) to waive the limitation on the reimportation of prescription drugs that have been exported from the United States. Reimportation would be allowed only under certain conditions and from certain countries, especially Canada.
 
The stated aim of the sponsors is to introduce more competition into the U.S. prescription drug market, and thereby reduce costs to consumers. In his introductory remarks on March 4, 2009, Senator Byron Dorgan (Democrat of North Dakota) declared that
  
We have a law in this country that says the drug companies can import drugs into our country, made in other regions of the world, but consumers cannot, registered or licensed pharmacists cannot, and wholesalers cannot. Our piece of legislation is very simple. It says, let's provide some competition here. If the prescription drug industry is selling their drugs in virtually every other country in the world for a fraction of the price they sell those drugs here, let's let licensed pharmacists in our country purchase them from Canada or another country and pass the savings along to the consumer.
 
The description that follows is based on the most recent version of this bill as introduced in the Senate, where it is designated as S.1232. That version of the bill was introduced on June 10, 2009 by Senator Dorgan and 29 other co-sponsors. The list of sponsors includes members of both parties. Other versions of the bill include an earlier Senate version (S.525) and companion legislation in the House of Representatives (H.R.1298).
The existing U.S. law generally provides, with certain exceptions, that no drug that 'is manufactured in a State and exported may be imported into the United States unless the drug is imported by the manufacturer of the drug.' The bill would allow the reimportation of qualifying drugs by a registered importer or an individual for personal use. It would also establish registration conditions for importers and exporters, and require the Department of Health and Human Services (DHS) to inspect places of business, verify chains of custody, etc. The bill would prohibit manufacturers from discriminating against registered exporters or importers; causing there to be a difference in a prescription drug distributed in the United States and one distributed in a permitted country; engaging in actions to restrict, prohibit, or delay the importation of a qualifying drug; or engaging in any action that the Federal Trade Commission determines discriminates against a person that engages or attempts to engage in the importation of a qualifying drug. Resale in the United States of prescription drugs that were properly sold abroad would not constitute patent infringement. DHS would be required to educate consumers regarding prescription drug importation, and the terms of the bill would govern the sale of prescription drugs through an Internet site.
Reimportation would be allowed only from certain countries. Canada would be immediately designated for such treatment, while other 'permitted countries' could be designated if DHS finds that 'the country has statutory or regulatory standards that are equivalent to the standards in the United States and Canada.' These potentially eligible countries include Australia, members of the European Union (except any country whose 'Annex to the Treaty of Accession to the European Union 2003 includes a transitional measure for the regulation of human pharmaceutical products that has not expired'), Japan, New Zealand, Switzerland, and any other country that meets certain criteria laid out in the bill.
An attempt was made in June, 2009 on the Senate floor to attach this bill as an amendment to an unrelated bill that was also sponsored by Senator Dorgan. That effort failed due to the parliamentary maneuvers of one senator from a state where major pharmaceutical companies are headquartered. Senate Majority Leader Harry Reid (Democrat of Nevada) nevertheless assured Senator Dorgan that he would allow the bill to be considered on the Senate floor, possibly as a stand-alone measure, later in 2009.
The consideration of this measure is tied to the larger debate over major reforms in the U.S. health-care system. President Obama had been one of the sponsors of a similar bill that was introduced while he still served in the Senate, and his proposal for the Food and Drug Administration's Fiscal Year 2010 budget supports reimportation. According to a story in the Wall Street Journal (July 8, 2009), "White House officials have told the industry if the larger health care bill passes, the cost savings will be so great that reimportation will be unnecessary." The story attributes that observation to President Billy Tauzin of the Pharmaceutical Research and Manufacturers of America. That group is the principal opponent of reimportation, which is supported by (among others) the American Association of Retired Persons and the Canadian International Pharmacy Association.
 
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On December 15, 2009 the Senate defeated an amendment to the healthcare bill (H.R.3590) that would have permitted pharmacies and wholesalers to import lower-priced, Federally approved pharmaceuticals from Australia, Canada, European Union, Japan, and New Zealand. The amendment was sponsored by Senator Byron Dorgan (Democrat of North Dakota) but was opposed by the Obama administrtion. It was failed on a vote of 51-48.

AFFECTED SECTORS