Prescription Drug Importation

Prescription Drug Importation

Updated January 22, 2024
Prescription Drug Importation
In the context of rising drug prices, the possibility of
into interstate commerce of a drug that is unapproved,
importing prescription drugs from other countries at lower
adulterated (e.g., held under insanitary conditions), or
prices is again being debated. Generally, the importation or
misbranded (e.g., the labeling does not include adequate
reimportation of a prescription drug that does not meet
directions for use) [FFDCA Sections 505(a), 301(a), (d)].
Food and Drug Administration (FDA) requirements is
Commercial Use. FFDCA Section 801(d)(1)(B) explicitly
prohibited. The policy debate has centered on creating a
prohibits the importation for commercial use of unapproved
legal option for the import of lower-cost prescription drugs
drugs manufactured outside of the United States, with two
into the United States.
exceptions: (1) as authorized by the Secretary of Health and
Prescription Drug Regulation
Human Services (HHS) pursuant to a drug shortage, and (2)
pursuant to the authority at FFDCA Section 804 (discussed
FDA, under the Federal Food, Drug, and Cosmetic Act
in the next section). This prohibition does not apply to
(FFDCA), regulates prescription drugs. In order to market a
drugs when, although manufactured outside of the United
new drug in the United States, a manufacturer must obtain
States, the manufacturer has authorized them to be
approval from FDA by submitting a new drug application
marketed in the United States and has labeled them
(NDA), or in the case of a generic drug, an abbreviated
according to relevant FFDCA requirements.
NDA (ANDA). To get approval, the manufacturer must (1)
demonstrate the drug’s safety and effectiveness according
Reimportation. Current law also prohibits the
to criteria specified in law and regulation, (2) ensure that its
reimportation—importing an exported U.S.-manufactured
manufacturing facility passes FDA inspection, and (3)
drug back into the United States—of a U.S.-manufactured
obtain approval for the drug’s labeling. Drugs made in
drug by anyone other than the manufacturer (FFDCA
foreign countries that are imported into the United States
Section 801(d)(1)(A)). Reimportation of a U.S.-
for commercial distribution must comply with the same
manufactured drug by anyone other than the original
FFDCA requirements as domestically manufactured drugs,
manufacturer is illegal even if it meets all of the
including registration and premarket approval. A drug
requirements for approval under the FFDCA because it
manufacturer may import drugs produced abroad that have
could have been mishandled or otherwise adulterated when
not yet received approval (e.g., drugs intended for further
it was outside of the reach of FDA. FFDCA Section
processing) by complying with FDA and U.S. Customs and
801(d)(2) creates an exception to this prohibition, allowing
Border Protection (CBP) requirements. See CRS Report
the HHS Secretary to authorize the reimportation of a U.S.-
R41983, How FDA Approves Drugs and Regulates Their
manufactured drug where required for emergency medical
Safety and Effectiveness, and CRS Report R46507, FDA’s
care, or under FFDCA Section 804, as described below.
Role in the Medical Product Supply Chain and
Considerations During COVID-19.
The provision prohibiting the reimportation of U.S.-
manufactured drugs was put in place in 1987 in an effort to
Prescription Drug Importation
ensure a “closed system” for all prescription drugs
Foreign-made versions of FDA-approved drugs that have
marketed in the United States. Proponents of this
not been evaluated through the FDA process are typically
prohibition argued that it protected against the possibility of
considered unapproved new drugs and are illegal. The
prescription drugs that were manufactured in the United
FFDCA provides for the circumstances under which an
States and then exported from being brought onto the
unapproved drug may be imported into the United States.
American market in possibly subpotent, mislabeled,
This section discusses the circumstances under which
adulterated, expired, or counterfeit form. Manufacturer
importation is prohibited, as well as the circumstances
reimportation was permitted to allow for standard inventory
under which it is allowed.
control practices within the industry.
Importation That Is Prohibited Under Current Law Importation That Is Allowed Under Current Law
Under current law, the importation of unapproved new
FFDCA Section 804. Section 804 gives the HHS Secretary
drugs, including foreign-made versions of FDA-approved
authority to promulgate regulations to establish a drug
drugs, is generally prohibited. This would entail bringing
importation program under which pharmacists and
into the United States an unapproved drug manufactured
wholesalers could import unapproved prescription drugs
outside of the United States. Even in cases where the drug
from Canada into the United States, with certain
is a foreign-made version of an FDA-approved drug (i.e.,
qualifications. Specifically, the provision provides that the
the same active ingredient made by the same manufacturer),
program cannot become effective until the HHS Secretary
FDA has stated that it is highly unlikely that the version for
certifies that the importation program would pose no
additional risk to the public’s health and safety
the foreign market would meet all of the requirements in the
and would
offer “significant reduction in the
FFDCA for approval. Current law prohibits the introduction
cost” to U.S. consumers.
Until recently, no Secretary had given such approval.
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Prescription Drug Importation
However, on September 23, 2020, former HHS Secretary
demonstrate that the program will adequately ensure the
Alex Azar made the requisite certification in a letter to
protection of public health and result in a significant
Congress. HHS subsequently promulgated a final rule to
reduction in the cost of covered products to consumers.
implement Section 804 (described below).
Proposals must specify the eligible drugs to be included in
the SIP, which would have to bear the required U.S.
Drug Shortages. Current law allows FDA to take various
labeling and undergo testing for quality and authenticity, in
actions when a drug is in shortage, including expediting
addition to meeting other supply chain requirements. SIP
application review and facility inspection. One available
proposals also must identify the foreign seller in Canada
option (now under FFDCA Section 801(d)(1)(B)) is that the
that will purchase the eligible prescription drug directly
HHS Secretary may choose to exercise enforcement
from its manufacturer, as well as the U.S. importer that will
discretion and allow the temporary and tightly controlled
purchase the drug directly from the foreign seller. Both the
importation and distribution of unapproved drugs to
foreign seller and importer are subject to applicable U.S.
alleviate a drug shortage while domestic production gets
registration, licensure and supply chain security
back up to speed. This is generally done very rarely, only
requirements. FDA also issued final guidance to implement
after other options (e.g., diverting manufacturing to another
the second pathway (under FFDCA Section 801(d)(1)(B))
facility, working with a facility to address quality issues)
to facilitate importation of foreign-made versions of FDA-
are considered. In response to Hurricane Maria, for
example, FDA used “regulatory flexibility and discretion”
approved drugs under their existing U.S. approval. The
guidance applies to drug manufacturers, offering them an
to allow for the temporary importation of drugs not
option to import drugs that may provide lower-cost
approved for use in the United States and manufactured in
alternatives to U.S. consumers. In contrast, the final rule
other countries (e.g., Ireland, Mexico, and Canada).
creates a mechanism for importation by entities other than
Personal Importation Policy (PIP). As outlined in FDA
the drug manufacturer and does not require a
guidance, the agency allows some personal importation of
manufacturer’s authorization. The guidance applies to small
unapproved drugs on a case-by-case basis, but one of the
molecule drugs and biologics and is not limited to
criteria that FDA lists for such personal importation is there
importation from Canada. In July 2021, Executive Order
can be no effective treatment available in the United States.
14036 directed FDA to work with potential SIP sponsors;
Current law generally does not permit individuals to import
FDA has published materials related to the final rule and
or reimport prescription drugs for their own use; instead, it
the required cost analysis on its website.
directs the Secretary to exercise discretion to permit
personal importation on a case-by-case basis of drugs that
Drug Importation Policy
are for personal use, if such use does not appear to present
Legislation to expand legal drug importation was
an unreasonable risk to the individual. FFDCA Section
introduced in previous Congresses, and a provision
804(j) provides a statutory basis for the FDA waiver
addressing commercial and personal drug importation was
authority outlined in the PIP guidance, although the FDA
included in a user fee bill in the Senate (S. 4348, 117th).
issued the guidance prior to the establishment of Section
Some stakeholders express support for policies allowing
804. FDA has generally allowed individuals to bring into
commercial and personal importation of lower-cost drugs in
the United States a 90-day supply of unapproved drugs for
a way that ensures drug safety and integrity. Alternatively,
personal use where effective treatment is not available in
proposals to expand drug importation have been opposed by
the United States, it is for the treatment of a serious medical
some former FDA Commissioners and HHS Secretaries, as
condition, and there is no commercialization of the drug to
well as by the pharmaceutical industry, citing safety
U.S. residents. FDA’s PIP is not intended as a way for
concerns. Despite publication of the final regulation
consumers to bring lower-priced prescription drugs into the
implementing Section 804 and final guidance as noted, it
United States; rather, FDA intended this enforcement
remains unclear to what extent these policies will be
discretion to allow individuals to access treatments not
successfully implemented. To date, some states have
otherwise available in the United States.
submitted SIP proposals to FDA (e.g., Florida, Colorado),
and FDA in January 2024 authorized Florida’s SIP. The
Safe Importation Action Plan
authorization is time-limited, and Florida has several
In July 2019, HHS and FDA announced the “Safe
obligations, including, for example, adverse event
Importation Action Plan,” proposing two pathways to allow
monitoring, quarterly reporting to the FDA, and ensuring
or facilitate the importation of unapproved drugs. In
supply chain integrity. While the final guidance provides an
October 2020, HHS promulgated a final rule pursuant to
option for drug manufacturers to import certain drugs, it is
FFDCA Section 804 to implement the first pathway (21
unclear if manufacturers are interested in importing drugs
C.F.R. Part 251). The rule allows states and tribes to submit
intended for foreign markets. Further, other countries may
to HHS for review proposals for, and FDA to authorize,
be reluctant to support U.S. importation policies, as it may
time-limited Section 804 Importation Programs (SIP) to
affect their domestic supply of drugs. In November 2020,
permit the importation of certain prescription drugs from
the Canadian government announced that certain drugs
Canada, specifically Health Canada-approved versions of
intended for the Canadian market may not be sold outside
drugs marketed in the United States under an NDA or
of Canada if such sale would cause or worsen a shortage.
ANDA. Consistent with the statutory language of Section
804, certain drugs are ineligible for importation, including
Amanda K. Sarata, Specialist in Health Policy
biologics (e.g., insulin) and intravenously injected drugs,
IF11056
among others. Although then-Secretary Azar made a
certification, the final rule requires SIP sponsors to
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Prescription Drug Importation

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https://crsreports.congress.gov | IF11056 · VERSION 7 · UPDATED