Pharma Lobbying Group Loses Bid to Block Drug Imports From Canada
A U.S. District Court recently overruled a lawsuit by pharmaceutical industry members to stop state governments from importing prescription medications from Canada. This ruling may encourage more states to consider importing medications from Canada as a strategy to lower the cost of prescription drugs for Americans.
The lobbying group PhRMA filed the complaint with the public health group Partnership for Safe Medicines and the advocacy group Council for Affordable Health Coverage, claiming that drug importation would threaten public health. This lawsuit was prompted by the U.S. Food and Drug Administration (FDA), which issued a rule in 2020 that would allow states to import prescription drugs from Canada. However, the FDA has yet to sign off on any state plans as of this writing.
The plaintiffs alleged that action by the FDA would permit pharmacists and wholesalers to import prescription drugs into the United States without drug manufacturers’ authorization or oversight, which they claimed would present safety risks. The judge dismissed the case and ruled that drugmakers failed to prove they’d face a “concrete risk of harm” from such a federal law.
What Does This Mean?
The U.S. Department of Health and Human Services reported that total inflation-adjusted expenditures on prescription drugs reached $603 billion in 2021—up from $520 billion in 2016. Prescription drugs maintained an 18% share of total health care expenditures throughout that same time period. As prices rise for most everyday items, Americans continue to spend more of their health care dollars on medicine.
Some states, including Florida and Colorado, have been working on trying to reduce the cost of medications for their residents. This latest court setback for the pharmaceutical industry may inspire more states to consider medication importation as a strategic approach to lower prescription drug costs.
Employers should continue to monitor prescription drug trends, utilization and spending. Contact us for more health care resources.
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