Freedom Line Blog

Yesterday, the Trump Administration through the Department of Health and Human Services (HHS) inexplicably introduced a proposal to begin drug importation from other countries.

Currently, Americans enjoy the safest medicine market in the entire world under the system monitored by the U.S. Food and Drug Administration (FDA).  According to FDA estimates, over 99% of drugs making their way into the U.S. via international mail failed to comply with its standards, and the United Nations World Health Organization estimates that fully 10% of all medicines worldwide are actually counterfeit.  That’s an enormous and unacceptable threat.

It’s therefore no surprise that a bipartisan array of experts and officials, including Trump Administration officials, have long panned the drug importation idea.  Just last year, for instance, HHS Secretary Alex Azar labeled drug importation a “gimmick,” emphasizing that, “the last thing we need is open borders for unsafe drugs.”  Recent FDA Commissioner similarly lambasted the idea and detailed the numerous threats that it entails.  A collection of FDA Commissioners spanning the years 2002 through 2016 went so far as to write an open letter to Congress in 2017, explaining how drug importation, “could lead to a host of unintended consequences and undesirable effects, including serious harm stemming from the use of adulterated, substandard or counterfeit drugs.”

Safety concerns, however, aren’t the only problem with the drug importation idea.  The Congressional Budget Office (CBO) has studied the issue and concluded that drug importation would have little to no impact on actually lowering prices.  Former FDA Commissioner Gottleib concurred that the plan “would have added so much cost to the imported drugs; they wouldn’t be much cheaper than drugs sold inside our closed American system.”  Part of the problem, according to a Canadian Pharmacists Association (CPhA) statement released just yesterday, is that Canada’s market couldn’t handle the sudden onslaught of American demand, and importation would crash their market on which the U.S. drug importation plan would rely.

Additionally, as we at CFIF have long emphasized, importing other nations’ pharmaceutical policies and pricing would reduce drug innovation and availability to American consumers.  Even highly developed nations enjoy far fewer new life-saving and life-improving pharmaceuticals than the U.S., which should trigger alarm for every American.

This constitutes a rare unforced error, as drug importation violates free market principles, in addition to the fact that imported drugs meet neither safety nor dependability standards.

How else can we be certain that this is a terrible idea?  Socialist Senator Bernie Sanders (D – Vermont) advocates it.  That says all we need to know.

In our recent weekly Liberty Update commentary entitled “On Pharmaceuticals, HHS Contemplates Disastrous New Price Controls,” we explain how government price controls undermine intellectual property (IP) rights, stifle American innovation and ultimately punish consumers in the form of fewer new pharmaceuticals.  We therefore encourage the Trump Administration to rethink a toxic new proposal along those lines, and instead pursue a course more in accord with its generally excellent stewardship of our economy and markets to date.

In his latest weekly commentary entitled “Not Healthy to Be Naive,” John Stossel agrees, and in a nice blurb explains the real-world consequences of drug price controls:

[G]overnment-run systems save money by freeloading off American innovation.  American drug companies, funded by American customers, fund most of the world’s research and development of pharmaceuticals.  New drugs and devices are expensive, so sometimes in Britain, says Pope, ‘whenever a new drug comes on the market that can save lives, the government just doesn’t have the funds to pay for it.’

Patients, accustomed to accepting whatever government hands out, don’t even know about the advances available elsewhere.  Single-payer systems also save money by rationing care.  Hence the long waiting times for treatments declared ‘nonessential’ in Canada, Britain and, for that matter, at American veterans hospitals.”

Hopefully, the Trump Administration is listening and corrects course.

Yesterday brought good news in the form of Senate confirmation of Trump nominee Scott Gottlieb as Commissioner of the Food and Drug Administration.  In addition to favoring quicker pharmaceutical review and approval, as well as “free-market strategies to bring down drug costs,” The Wall Street Journal notes that Gottlieb brings a healthy skepticism of the ill-advised and potentially dangerous proposal to import drugs from Canada and other countries:

He has also questioned the wisdom of allowing U.S. consumers to import brand-name drugs from countries like Canada, where they cost less, in part because of safety concerns.”

Mr. Gottlieb’s view accords with the opinion of all four of the most recent FDC commissioners, who warned in a recent letter to Congress that suddenly allowing drug importation from Canada or other unsecure countries “is a risky approach that would endanger consumers by exposing them to fake, substandard and contaminated drugs”:

[G]lobal experience confirms that illicit, ineffective, or adulterated products are readily available on the open market and represent one of the most lucrative avenues of organized crime…  Obtaining sufficient resources and expertise to screen and verify the authenticity of every product destined for American consumers presents enormous challenges.”

That also accords with the view of former federal judge and Clinton and Bush FBI Director Louis Freeh, writing in The Philadelphia Inquirer:

Allowing citizens to purchase medicine direct from foreign countries will mean more risk to consumers from counterfeit drugs, more opportunity for criminal activity in the marketplace, and more stresses placed on overstressed law enforcement efforts to combat this problem.  The belief that U.S. consumers can gain access to safe and low-cost medicines from Canadian and European drug markets without an offsetting cost to consumer confidence and law enforcement is not realistic.  Quite the contrary, drug counterfeiting is a global threat that we’re inviting upon ourselves if Congress allows this idea to move forward.”

Drug importation is a deceptive and dangerous idea, particularly in a period of increasing opioid addiction across the country, and Congress shouldn’t make the country more perilous by pushing it.