Importing Prescription Drugs

Importing Prescription Drugs

Order Code RL31503
Report for Congress
Received through the CRS Web
Importing Prescription Drugs
Updated August 22, 2002
Blanchard Randall IV
Analyst in Social Sciences
Domestic Social Policy Division
Donna U. Vogt
Specialist in Social Legislation
Domestic Social Policy Division
Congressional Research Service ˜ The Library of Congress

Importing Prescription Drugs
Summary
In recent years, American consumers, particularly the elderly and uninsured,
have discovered they often pay a lot more for pharmaceuticals than citizens in other
countries. As prescription drug prices continue to rise, more patients are turning to
the Internet, or traveling outside the county, to find cheaper prescription drugs.
Under current law, however, only drug companies can import pharmaceuticals into
the United States. Despite this legal restriction, the Food and Drug Administration
(FDA) has for years allowed patients to bring a 90-day supply of prescription
medications into the country under its so-called “personal use” import policy.
In 2000, the 106th Congress passed the Medicine Equity and Drug Safety
(MEDS) Act, legislation that would have allowed pharmacists and drug wholesalers
to import less costly FDA-approved drugs from other countries. However, Congress
stipulated that the Act could not be implemented unless the Secretary of Health and
Human Services (HHS) could first guarantee that all drugs imported under the
program would be safe and offer significant cost savings for consumers. In time,
both the former and current Secretaries said these conditions could not be met, and
declined to implement the law.
Congress is considering several ways to increase the supply of less costly
prescription drugs for consumers, in particular codifying FDA’s “personal use”
import policy, and creating a program that would let pharmacists and drug
wholesalers import drugs commercially. On July 31, 2002, the Senate passed the
Greater Access to Affordable Pharmaceuticals Act (S. 812), legislation to speed-up
the approval of less costly generic drugs. The bill included the text of the
Prescription Drug Price Parity for Americans Act (S. 2244), an amendment offered
by Senator Dorgan, that would allow people to bring a 90-day supply of prescription
drugs into the country for personal use from registered Canadian pharmacies, and
simultaneously create a commercial import program, similar to the MEDS Act, that
would let licensed pharmacists and drug wholesalers import FDA-approved
prescription drugs from Canada. The Senate also agreed to an amendment sponsored
by Senator Cochran that would require the Secretary of HHS to first certify to
Congress that all imported drugs would be safe and offer significant cost savings for
consumers, the same two contingencies that kept the MEDS Act from being
implemented in 2000. H.R. 4614, a bill similar to the Dorgan amendment is
currently pending in the House.
Supporters of the various drug import proposals are urging Congress to pass
legislation that will codify FDA’s personal use import policy, making it easier for
patients to bring cheaper prescription drugs into the country, and at the same time
establish a program allowing pharmacists and drug wholesalers to import drugs
commercially from Canada. Opponents, on the other hand, argue that these proposals
could weaken existing import laws and make it easier for unsafe or counterfeit drugs
to enter the country. While the Dorgan/Sanders bills would mandate authenticity
testing to safeguard against this, the cost of testing would likely be passed on to
consumers, and critics question whether there would be a noticeable reduction in the
price of prescription drugs.

Contents
Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Background . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
FDA’s Personal Use Import Policy . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Drug Import Legislation: 106th Congress . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
The Medicine Equity and Drug Safety (MEDS) Act . . . . . . . . . . . . . . . 3
Drug Import Legislation: 107th Congress . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Prescription Drug Price Parity for Americans Act (S. 2244 and
H.R. 4614) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Other Proposed Legislation to Allow Drug Imports . . . . . . . . . . . . . . . . . . . 6
The Medication Equity and Drug Saving Act (S. 215) . . . . . . . . . . . . . 6
The Personal Prescription Drug Import Fairness Act (S. 1229) . . . . . . 7
Drug Importation Act of 2002 (H.R. 5186) . . . . . . . . . . . . . . . . . . . . . . 7
Issues for Consideration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Reducing Prescription Drug Costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Lowering the Cost of Prescription Drugs for Personal Use . . . . . . . . . . 9
Drug Labeling . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Product Integrity and Inspections . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
FDA Enforcement Issues and “Personal Use” Imports . . . . . . . . . . . . 10
Lack of Physician Involvement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12

Importing Prescription Drugs
Introduction
In recent years the rising cost of prescription drugs has become an ongoing issue
for Congress. International comparisons of pharmaceutical prices have shown that
American consumers, particularly the elderly and uninsured, often pay a lot more for
their prescriptions than do citizens in other countries. Frequently this price disparity
stems from the fact that some countries, particularly those with nationalized health
care systems, can negotiate lower prices due to a greater economy of scale. The
lower pharmaceutical prices in these countries are often enough incentive for some
U.S. citizens to purchase their prescription drugs from Internet or mail-order
pharmacies, or when they travel outside the United States, especially to Canada or
Mexico. As this practice has become more common in recent years, legislation has
been offered in Congress to make it easier for less costly prescription drugs to be
imported from foreign suppliers.
Background
Concerned that large quantities of unsafe prescription drugs were being
reimported back into the United States in the mid-1980s as “American goods
returned,” a situation that could threaten the health of American consumers, Congress
passed the 1987 Prescription Drug Marketing Act (PDMA).1 The Act included a
provision that, from that time on, made it illegal for anyone other than drug
manufacturers to import pharmaceuticals into the United States. Today, section
801(d)(1) of the Federal Food, Drug, and Cosmetic Act (FFDCA) states that no “drug
...which 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 intent of PDMA was to keep subpotent or adulterated drugs from
inadvertently ending up in U.S. pharmacies.2 To enforce the law, the FDA has
adopted regulations that require drug companies to maintain a detailed chain of
custody for all pharmaceuticals imported into this country. Today, these rules not
only impose strict record keeping requirements, they also require manufacturers to
ensure the safety and quality of drugs that are exported, and then reimported back
into this country.
1 P.L. 100-293.
2 U.S. Congress. House. Committee on Energy and Commerce. Prescription Drug
Marketing Act of 1987. H.Rept. 100-76, 100th Cong., 1st Sess. Washington, GPO, April 30,
1987. p. 7.

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When drugs are imported into the United States, whether they are shipped
commercially, carried by travelers, or mailed, the U.S. Customs Service and FDA
have broad authority to deny products that “appear” to violate U.S. regulatory
standards. For regulatory enforcement purposes, FDA separates imported
prescription drugs into three broad categories: (1) drugs for commercial distribution;
(2) prescription drugs that arrive by mail or common carrier; and (3) prescription
drugs that are brought into the country by persons passing through U.S. customs.
FDA’s Personal Use Import Policy. As noted above, only drug companies
can import drugs legally into the United States. Nevertheless, the FDA for years has
maintained a policy that allows patients to bring a small amount (i.e., a 90-day
supply) of non-FDA approved drugs into this country for compassionate use. Over
the years, the so-called “personal use” import policy has made it easier for patients
with life-threatening diseases (such as cancer and AIDS) to bring medicines into this
country and be treated by their personal physician.3 Under the policy, drugs cannot
be imported commercially. In addition, patients are supposed to affirm in writing
that the drug is for their own use, and provide the name and address of their
physician. Today, prescription drugs that enter the country under the import policy
are brought in by individuals, or more typically, arrive by mail after being purchased
from Internet pharmacies.
When FDA instituted the personal use import policy years ago, it was not
supposed to be a way for patients to bring cheaper drugs into this country, nor a
means to obtain prescription drugs already available in the United States. Though
the policy has not been changed, where it once let patients import drugs for so-called
“compassionate” use, today it is used to import drugs for all sorts of medical
conditions, or by consumers seeking lower price prescription drugs from other
countries.4 Over the years, advances in technology, economic changes, and lenient
enforcement have led to a dramatic increase in the number of drugs being brought
into the country. Not surprisingly, monitoring this wave of drug products has
become a major problem for Customs Service inspectors.
In 2001, the Customs Service and FDA conducted a 5-week survey in Carson
City, California to get a better idea of the number and types of drug products that
were entering the United States by mail. According to the agencies, many of the
drugs detained during the survey were for treating health conditions that normally
require a doctor’s diagnosis.5 This finding raised the concern that patients who
obtain prescription drugs without a doctor’s prescription may be exposing themselves
to serious health risks. During a June 7, 2001 congressional hearing on FDA’s drug
import policy, an FDA official testified that the agency had recommended that the
Secretary of HHS end the practice of allowing drugs to be imported by mail, so long
3 U.S. Food and Drug Administration. [http://www.fda.gov/ora/import/pipinfo.htm].
4 U.S. citizens who want to have their prescriptions filled by Canadian pharmacies must
have the prescription confirmed by a Canadian physician before the pharmacy will fill it.
5 Hubbard, William K., Senior Associate Commissioner for Policy, Planning, and
Legislation, Food and Drug Administration. Testimony before the Subcommittee on Health,
Committee on Energy and Commerce, July 25, 2002.

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as DHHS retained an exception for drugs intended for compassionate use.6 The large
number of drugs entering the country by mail has become an enforcement problem,
and the agency is concerned that government inspectors cannot, with any assurance,
determine if the products being shipped are safe.
U.S. Drug Approval Requirements
Under the Federal Food, Drug, and Cosmetic Act, drugs must be proven safe
and effective before they can be approved by the FDA for marketing. As a first
step in this process pharmaceutical companies conduct pre-clinical (i.e., animal)
tests to determine if the chemical compound is safe enough to undergo further
evaluation in human subjects. If the drug is indeed safe enough to be administered
to patients, the company files an investigational new drug (IND) application
seeking FDA’s permission to begin its clinical trials. When the clinical studies are
completed, the drug’s safety and efficacy data are submitted in a New Drug
Application (NDA) for FDA’s review. While the NDA is under review, agency
officials sample the ingredients that will be used in the final product, and inspect
the production process to be sure it meets current good manufacturing practices
(GMPs). Almost simultaneously, the drug’s official labeling is reviewed to make
sure it is medically accurate and comprehensive. All drugs imported into the
United States, whether they were manufactured here or abroad, have to be FDA-
approved and be properly labeled. Moreover, imported pharmaceuticals must be
accompanied by information telling where they were made, the name and address
of the importer, and evidence that they were produced in FDA-inspected facilities.
Drugs that do not meet U.S. standards are considered “unapproved” drugs and
cannot be legally imported into the country.
Drug Import Legislation: 106th Congress
The Medicine Equity and Drug Safety (MEDS) Act. In an effort to take
advantage of the lower prices charged by drug manufacturers in foreign countries,
in 2000, the 106th Congress passed the Medicine Equity and Drug Safety (MEDS)
Act. Part of a FY2001 agriculture appropriations bill,7 the MEDS Act established a
5-year program that would have allowed pharmacists and drug wholesalers to import
less costly prescription drugs from overseas suppliers. As an integral part of the
program, the Secretary was required to publish regulations only if he/she could
guarantee that all imported drugs would be FDA-approved, tested for authenticity,
and properly labeled before they could be distributed to retail pharmacies in the
United States. Pharmaceuticals imported under the Act could only come from
specified countries, and if a pattern of counterfeiting emerged, the agency could
suspend importation immediately.
6 Ibid.
7 P.L. 106-387. Added new section 804 to the Federal Food, Drug, and Cosmetic Act.

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Congress stipulated, however, that certain conditions had to be met before the
MEDS Act could go into effect. More specifically, the Secretary of HHS had to
verify that implementation would pose no additional risk to public health and safety,
and would lead to a significant reduction in the cost of drugs for U.S. consumers. In
late December 2000, then-Secretary Donna Shalala announced that she could not
implement the MEDS act because it contained several “serious flaws and loopholes.”
According to the Secretary the law allowed drug companies to deny U.S. importers
legal access to FDA-approved labeling that would be required for reimportation.
Second, the Act did not prohibit drug manufacturers from requiring distributors to
charge higher prices, limit supply, or treat U.S. importers less favorably than foreign
purchasers.8 And last, the drug import legislation’s 5-year “sunset” provision would
have had a chilling effect upon private-sector investment in the testing and
distribution systems required under the law.9
Several months later, her successor, Secretary Tommy G. Thompson, declined
to implement the law as well, stating that the safety of prescription drugs could not
be adequately guaranteed if drugs were allowed to be re-imported under the MEDS
Act.10 Moreover, the Secretary pointed out that the costs associated with
documenting, sampling and testing of imported drugs, as the MEDS Act required,
would make it very difficult for consumers to recognize any noticeable price savings.
Drug Import Legislation: 107th Congress
At the start of the 107th Congress, some Members said they were concerned
about the Secretary’s refusal to implement the MEDS act, and promised to introduce
new legislation that would let less costly prescription drugs be imported from outside
the country, and simultaneously address some of the issues the Secretary was
concerned about, namely, exclusive contracts among manufacturers and importers
and the proprietorship of labeling.
In the first session, the House passed an amendment, offered by Representative
Gutknecht to a FY2002 agriculture appropriations bill (H.R. 2330), that would have
given persons — who were not in the drug import business — the legal right to bring
FDA-approved, non-narcotic, prescription drugs into the country for self-treatment.
To do this, the amendment would have kept FDA from enforcing the section of the
law that only allows drug companies to reimport pharmaceuticals into the United
States. However, the Gutknecht amendment was later dropped during final
conference on the bill, and never became law.
Prescription Drug Price Parity for Americans Act (S. 2244 and H.R.
4614). The Prescription Drug Price Parity for Americans Act was introduced in
April 2002 (S. 2244) by Senator Dorgan, along with an identical House counterpart
8 Donna E. Shalala, Secretary of Health and Human Services. Letter to President William
J. Clinton, December 26, 2000.
9 Ibid.
10 “Secretary Thompson Determines That Safety Problems Make Drug Reimportation
Unfeasible,” HHS News, Press Release July 10, 2001. [http://www.hhs.gov/news]

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(H.R. 4614) sponsored by Representative Sanders. Though both bills are very similar
to the MEDS Act of 2000, they have some significant differences. For instance,
unlike the MEDS Act, the Dorgan/Sanders bills, as originally introduced, would not
require the Secretary to first certify that imported drugs would be safe and provide
reduced prices for consumers before the law could be implemented. Also, where the
MEDS Act would have allowed prescription drugs to be imported from almost any
country, the Dorgan/Sanders bills would allow them to be imported only from
Canadian suppliers. In turn, Canadian pharmacies and wholesale pharmaceutical
suppliers would have to register with the Secretary of HHS. In addition, the bills
require the Secretary, by regulation, to grant individuals the right to import a 90-day
supply of prescription drugs from licensed Canadian pharmacies.
On July 31, 2002, the text of the Dorgan bill was agreed to as an amendment
(S.Amdt. 4300) when the Senate passed the Greater Access to Affordable
Pharmaceuticals Act (S. 812), legislation designed to speed-up the marketing of
generic drugs. The bill included a second amendment (S.Amdt. 4301), offered by
Senator Cochran, which added the same two contingencies included in the 2000
MEDS Act, specifically that the Secretary of HHS must first guarantee that all
imported prescription drugs will be safe, and lead to significant cost saving for
American consumers. By agreeing to the Dorgan and Cochran amendments together,
the Senate in essence made S. 2244 virtually identical to the MEDS Act, with the
important exception that under the Dorgan amendment pharmaceuticals can only be
imported from Canadian suppliers.
The Dorgan amendment and H.R. 4614 are similar to the MEDS Act in that they
would both direct the Secretary to adopt regulations requiring importers to document
the name of the drug, the quantity of the active ingredient, a description of the dosage
form, the date of shipment, the point of origin and destination, and the price paid by
the importer. In addition, importers would have to provide documentation from the
foreign seller specifying the original source of the drug, the quantity received by the
seller from that source, the manufacturer’s lot or control number, and the name,
address, telephone number, and licence number of the importer.
For drugs shipped directly from the first foreign recipient of the drug, the
Dorgan amendment and the Sanders bills would require documentation — including
quantity and lot numbers — verifying that the drug had been received by the recipient
from the manufacturer, and subsequently shipped to the importer. For initial
shipments, the proposals would require documentation that each batch of the drug
had been statistically sampled and tested for authenticity and degradation; subsequent
shipments would need verification that a valid sample of the drug had undergone this
testing.
For prescription drugs that are not shipped directly from the first foreign
recipient, there would have to be documentation showing that each batch in each
shipment entering the United States had also been statistically sampled and tested for
authenticity and degradation. Importers and manufacturers would be responsible for
the testing, which would have to be performed by qualified labs. Like the MEDS
Act, both the Dorgan amendment and Sanders bill would require the Secretary to
immediately suspend the importing of a specific drug, or the importing by a specific
importer, if the drugs are found to be counterfeit. While the legislation imposes no

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penalties in this event, the MEDS Act included a fine not to exceed $250,000, and
up to 10 years in prison.
To counter concerns regarding the proprietorship of drug labeling that arose
after the MEDS Act was enacted, the Dorgan amendment and the Sanders bills would
allow importers to use a drug company’s FDA approved labeling free of charge.
Moreover, they would make it illegal for drug makers to discriminate against
pharmacists or wholesalers, or enter into contracts that would place conditions on the
sale or limit supplies of prescription drugs.
Under the Dorgan amendment and H.R. 4614 the Secretary would be allowed
to grant persons a waiver, either through rule-making or on an individual basis, of the
law that permits only manufacturers to import FDA-approved drugs and devices. For
drugs brought from Canada, the waivers would let people import a 90-day supply of
prescription drugs from registered Canadian pharmacies, as long as the drug was
accompanied by a valid prescription. The amendment directs the Secretary to use
discretion when enforcing the prohibition against persons importing drugs and
devices for personal use, particularly in situations where the drug or device poses
little risk to the individual. To clarify this point further, the Secretary would be
required to publish guidance describing the circumstances in which waivers would
be granted to let people bring drugs into the country for personal use.
Both the Dorgan amendment and the Sanders bills would eliminate the “sunset”
provision in the MEDS Act that placed a 5-year limitation on the import program.
Lastly, the bills direct the Secretary of HHS to request that the Institute of Medicine
of the National Academy of Sciences, to do an evaluation of the entire import
program. Further, the General Accounting Office would have to do an analysis of
whether the legislation had any effect on the price of prescription drugs sold to
consumers at retail.
Other Proposed Legislation to Allow Drug Imports
Thus far, only the Dorgan amendment and Sanders bill would let persons
import cheaper prescription drugs for self-treatment, while simultaneously allowing
pharmacists and drug wholesalers to import drugs commercially from Canada.
However, there are several other bill that would codify FDA’s current personal use
import policy as well, and in doing so make it legal for patients to import small
amounts of prescription drugs.
The Medication Equity and Drug Saving Act (S. 215). Introduced in
January 2001 by Senator Stabenow, the Medication Equity and Drug Saving Act
would require the Secretary of HHS to promulgate regulations that would allow
persons to bring certain prescription drugs into the United States in their personal
baggage, or through the mail. Under the bill, prescription medications could only be
imported for self-treatment, and the name of the patient, their doctor, the place of
purchase, port of entry, and the cost of the drug would have to be provided. The
Secretary would have to evaluate the program in 5 years and report the results to
Congress.

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The legislation specifies the countries from which drugs could be imported,11
and allows the Secretary to designate additional countries, unions, or economic areas.
It would reconcile the concerns that kept the MEDS Act from being implemented in
2000 and 2001. That is, importers would be allowed to use another company’s
approved labeling for a fee, and discriminatory pricing agreements between importers
and pharmaceutical companies would be outlawed. In addition, it would give the
Secretary 30 days to certify to Congress that the program would not pose a
“appreciable additional risk to public health” before the rule-making process to
implement the program could begin. The Stabenow bill would also eliminate the
“sunset” clause that allowed the MEDS Act to run for only 5 years.
The Personal Prescription Drug Import Fairness Act (S. 1229).
Introduced by Senator Wellstone in July 2001, the Personal Prescription Drug Import
Fairness Act would establish a legal framework for FDA’s current “compassionate”
use policy, and extend its coverage to drugs for treating any medical condition. The
bill would amend the Federal Food, Drug, and Cosmetic Act and require the
Secretary of HHS — in consultation with the U.S. Trade Representative and the
Commissioner of Customs — to issue regulations that would allow individuals,
either in person or by mail, to bring a 90-day supply of prescription drugs into the
country for self treatment. Drugs imported under the measure would have to be
FDA-approved, in final dosage form, manufactured in FDA-registered facilities, and
come from specified countries.12 Furthermore, drugs imported for personal use could
not be resold in this country.
Under the legislation, imported prescription drugs, whether they were brought
in by patients or came by mail, would have to be accompanied by a new import form.
The form would have to include the patient’s name, address, and telephone number,
the name of the dispensing pharmacy, and the place where the drug was
manufactured. Also, the name of the patient’s doctor, or evidence the drug is to
continue treatment that began outside the country, would have to be on the form. The
bill would require the Secretary to maintain records of each prescription drug
imported. Also, the Secretary would have to compile a publicly available list of
FDA-approved drugs that could be imported for personal use that are made outside
the United States, or that, if they are manufactured here, are then exported to a
foreign country.
Drug Importation Act of 2002 (H.R. 5186). Introduced by Representative
Kingston on July 23, 2002, the Drug Importation Act of 2002 would amend Section
801 (Imports and Exports) of the FFDCA with language that would, for all practical
purposes, codify FDA’s personal use import policy, and let persons who were not in
the drug import business bring prescription drugs into the country as long as the
drugs “appear” to be FDA approved, are non-narcotic, and appear to be
manufactured, compounded, or processed in facilities registered with the agency.
11 Australia, Canada, Israel, Japan, New Zealand, Switzerland, and South Africa.
12 Australia, Canada, Israel, Japan, New Zealand, Switzerland, South Africa, or the European
Union or a country in the European Economic Area (the countries in the European Union
and the Free Trade Association).

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The Kingston bill would require the Secretary of HHS to establish a program
within 6 months of enactment that would allow licensed pharmacists to import
prescription drugs into the country as long as the drugs were FDA approved, met
U.S. standards for quality, and were manufactured in FDA registered facilities.
Procedures established under the new program could require pharmacists to register
with the Secretary and the Secretary to approve the drug’s chain of distribution
outside the United States. Under the bill, prescription drugs included in Schedules
I, II, or III of the Controlled Substances Act (i.e. narcotics), or biological products13
regulated under Section 351 of Public Health Services Act, could not be imported.
In addition, the Secretary may, by regulation, authorize the use of alternative labeling
for imported prescription drugs, and as long as such labeling is modified to comply
with applicable trademark and copyright laws, the drugs wouldn’t be considered
legally misbranded.
Issues for Consideration
Reducing Prescription Drug Costs. The Dorgan amendment and Sanders
bill, much like the MEDS Act, would establish an import program that would
increase the overall supply of pharmaceuticals by letting pharmacists and drug
wholesalers import prescription drugs commercially from Canada. The legislation’s
backers maintain that such a program will enhance competition and lead to lower
cost prescription drugs for U.S. consumers. Some critics, however, question whether
such a program will in reality translate into lower prices for prescription drugs since
the proposals make no guarantee that pharmacists and wholesalers will pass any of
the potential savings on to consumers.
While both the Stabenow and Wellstone bills would allow drugs to be imported
from most industrialized countries, under the Dorgan amendment and Sanders bill,
prescription drugs could only be imported from Canada.14 At present, it is unknown
whether manufacturing facilities operating in Canada, even those registered with the
FDA, would be capable of suppling the variety and quantity of drugs that American
consumers would likely demand. In fact, under the amendment, heavily prescribed
pain-relieving medications, products that could be riskier for patients such as
biologics, certain infused and intravenous drugs, and inhalation drugs used during
surgery, could not be imported.
The Stabenow bill, the Dorgan amendment and H.R. 4614 would explicitly
prohibit drug companies from discriminating against pharmacists and drug
wholesalers, either by limiting prices or supplies. It has been suggested, however,
that drug companies could find a way around the legislation by simply exporting
drugs with characteristics (e.g., color, size, shape, or dosage) different than those
distributed in the United States. Since the imported drugs might not look exactly the
same as their U.S.-approved counterparts, they could be deemed “unapproved,” and
as such, not qualify for import.
13 “Biological products,” as defined under Section 351 of the Public Health Service Act,
usually refers to viruses, serums, toxins, antitoxins, vaccines, blood, blood components or
derivatives, and allergenic products.
14 See notes 11 and 12.

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Lowering the Cost of Prescription Drugs for Personal Use. The
Dorgan amendment and the other bills would all codify FDA’s current “personal use”
import policy. Those who favor making the policy permanent contend that, as long
as the disparity in drug prices continues, consumers will benefit only if they are able
to purchase and import lower priced pharmaceuticals from virtually any country.
Given that many foreign counties, including Canada, impose strict government
controls on drug prices, it would be difficult to determine a set of circumstances that
would completely eliminate the pricing differentials that are currently driving
consumer demand for foreign prescription drugs.
Drug Labeling. As noted above, the FDA must okay the labeling of all drugs
before they can be approved for marketing. However, the Stabenow bill would not
require pharmaceutical companies to give pharmacists and wholesalers the kind of
information they would need to authenticate an imported drug, have it tested, and
verify that it is properly labeled. Under the bill, importers would have to pay a fee
for the privilege of using another manufacturer’s labeling, while the Dorgan
amendment and H.R. 4614 would direct drug companies to let importers to use their
labeling “at no cost.” Similarly, the Kingston bill would permit importers to use
modified labeling without the drug being deemed misbranded under the FFDCA.
However, since most drug manufacturers consider the formulas, brand names, and
even the labeling of their prescription products to be proprietary under U.S. copyright
and trademark laws, they might seek remediation in the courts if they are forced to
make this kind of information available to importers.15 If this sort of litigation
occurs, the import program could either be delayed or at least made more difficult to
implement.
Product Integrity and Inspections. The purpose of these proposals is to
make it easier for lower priced prescription drugs to be imported into the country.
If this happens, some argue that the legislation may make it easier for adulterated,
misbranded, subpotent, or counterfeit drugs to enter the distribution pipeline, and end
up in U.S. retail pharmacies. Although the additional bioterrorism funding has
allowed the FDA to hire more border inspectors, there is still the concern that
opening U.S. borders to drug imports may encourage the transshipment of more
counterfeit drugs from neighboring countries, particularly Canada.16 Also, FDA
inspectors could be drawn away from other priorities, such as food safety, into the
monitoring of more drug records and increased inspections of overseas production
facilities and at U.S. borders.17 Supporters are quick to point out, however, that all
the drugs that would be allowed in under the personal use import policy would have
to be FDA-approved, and under the Dorgan/Sanders proposals, only come from
registered Canadian manufacturing plants. Critics maintain, however, that testing
15 Maintaining that patent holders have the “exclusionary right” to decide whether to sell
a product, or even to set conditions for its sale, some feel that the clause in the drug import
legislation prohibiting certain contractual agreements may violate the Constitution.
16 “Dorgan Plans Bill to Allow Reimportation of Drugs From Canada,” Inside FDA Week,
March 1, 2002, p. 13-14.
17 “Rx Reimportation Could Divert FDA Inspectors From Food Safety-HHS,” The Green
Sheet, February 25, 2002, p. 3.

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drugs for authenticity and purity can is very costly and time consuming. In fact, the
FDA Deputy Commissioner has stated:
...there is no testing that can ensure that a shipment of drugs does not contain
counterfeits. Since counterfeits can easily be commingled with authentic
product, either by the case, by the bottle, or by the pill, there is no sampling or
testing protocol sufficient to protect against the grave public harm they pose. No
random sampling plan will be able to detect and protect such criminal conduct
since the threat does not depend upon the nature of the reimported product, but
upon the integrity of those handling it. Furthermore, the legislation fails to
require reporting of any counterfeits that may be found by testing, so even if
counterfeits are discovered, FDA may never learn of them.18
FDA Enforcement Issues and “Personal Use” Imports. As mentioned
before, the Dorgan amendment and the other proposals would all codify FDA’s
current “personal use” import policy, and make it legal for citizens to import a 90-day
supply of FDA-approved drugs, in final dosage form, from registered manufacturing
facilities. As such, very little would change in terms of current policy. Patients
bringing prescription drugs into the United States for personal use would still have
to fill out an import form providing their name, the address of the pharmacy, the
name of their doctor (or evidence that the drug was for a medical condition that
began overseas), and where the drug was made. The Kingston bill, however, calls
for none of these obligations on the part of patients, nor does it require imported
drugs to undergo any additional authenticity or safety testing. Furthermore, drugs
imported for personal use would only have to “appear” to be FDA approved, a
situation that might make it somewhat easier for counterfeit drug products to enter
the country.
The Kingston proposal notwithstanding, all of the other bills call for some sort
of additional safety testing for imported drugs. Whether this will insure that every
prescription drug imported into the country will meet FDA’s high standards for
quality, is unknown. However, the Dorgan amendment and the Sanders bill may
impart greater consumer protection by insisting that dispensing pharmacies, in this
instance Canadian pharmacies, be registered with the Secretary of HHS. The
Kingston legislation, as a condition for participation under its drug import program,
would require U.S. pharmacists to be registered with the Secretary, and that there be
an approved chain of distribution for drugs outside the United States. In the event
adulterated or counterfeit drugs do find their way into retail pharmacies, such record
keeping requirements would presumably make it easier for FDA officials to
determine the source.
Critics point out, however, that the Dorgan amendment may not necessarily give
FDA the kind of enforcement discretion that it believes it needs. In a recent letter to
Senator Cochran, the Deputy Commissioner of FDA, Lester Crawford, stated that the
Dorgan amendment and H.R. 4614 would:
18 Crawford, Lester M. Letter to Senator Thad Cochran, July 17, 2002. Reprinted in the
Congressional Record, v.148, n. 97, July 17, 2002, pp. S6913-S6914.

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...compel the Secretary to promulgate guidance to allow consumers to directly
import drugs and medical devices from Canada. This represents an enormous
intrusion on the Department’s enforcement discretion, and it would over-ride
existing statutory provisions that allow FDA to refuse personal importation of
prescription drugs from Canada if they are believed to be unsafe, ineffective,
adulterated, radioactive, or contaminated.19
In addition, if, as these measures intend, FDA’s “personal use” import policy
becomes law, the agency has said that even with the additional import records
required under the Stabenow and Wellstone bills, it will be unable to guarantee the
integrity of all drug products simply because there is no way its inspectors can
examine every parcel and determine the quality of its contents. In fact, the agency
testified before Congress in 2001 that should any of these bills become the law, it
would continue to be “buyer beware” for consumers who decide to import
prescription drugs under these circumstances.20 The success of an expanded import
mechanism for pharmaceuticals would, in all likelihood, depend on the ability of
consumers to make purchases and obtain approved drugs without undue
administrative hardships.
Since FDA inspectors cannot examine every drug product that enters the country
via the mail or in personal baggage, and referred to the agency by the U.S. Customs
Service, some commentators have stated that it could become increasingly difficult
for the agency to keep counterfeit pharmaceuticals out of the country, especially if
they look like FDA-approved drugs and appear to comply with U.S. regulations. At
a recent Senate hearing on counterfeit medicine before the Special Committee on
Aging, an FDA official testified that even though the Dorgan/Sanders bills (now the
Senate approved Dorgan amendment) attempt to ensure the safety of drugs by
requiring authenticity testing, the legislation would not protect against the threat of
counterfeit drugs because no random sampling plan can protect against such criminal
conduct.21 In fact, a recent news article noted that drug tampering incidents involving
mislabeling, substitution, or dilution of drug ingredients are being reported more
frequently.22
The Wellstone bill would require FDA to keep records of all prescription drugs
brought into the country for personal use. The agency would also have to compile
a list of each and every FDA-approved drug, manufactured domestically or abroad,
that could be imported into the country. According to the agency, maintaining such
a list, and monitoring the greater volume of pharmaceuticals that would be entering
19 See note 17, Crawford, p. S6914.
20 Hubbard, William K., Senior Associate Commissioner, Policy, Planning, and Legislation,
Food and Drug Administration. Letter to the Honorables W. J. “Billy” Tauzin, Chairman,
and John Dingell, Ranking Minority Member, Committee on Energy and Commerce, House
of Representatives, July 17, 2001.
21 Hubbard, William K., Senior Associate Commissioner, Policy, Planning and Legislation,
Food and Drug Administration. Hearings Before the Senate Special Committee on Aging.
Buyer Beware: Public Health Concerns of Counterfeit Medicine, July 9, 2002. p. 14.
22 Ochs, Ridgely. “Fake prescription drugs seep into consumer market,” The Detroit News,
July 21, 2002, found at [http://detnews.com/2002/health/0207/21/a02-542333.htm]

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the country, would add enormously to its regulatory responsibilities, without making
the imported drugs any more safe.
Lack of Physician Involvement. The FDA is concerned that a growing
number of patients today, particularly those who use Internet pharmacies, are buying
and taking medications, often without the traditional safeguards of a medical
diagnosis and a doctor’s prescription. To address these concerns, the Dorgan
amendment/H.R. 4614, Stabenow, and Wellstone bills would require individuals
importing drugs into the country for self treatment to have a valid doctor’s
prescription, or at least provide the name of the health care professional responsible
for their treatment. In contrast, the Kingston proposal would impose none of these
requirements on the part of patients. Since prescription drugs can often cause serious
side effects that are known only by doctors and other professional health care
providers, those with doubts about provisions expanding Internet or mail-order
availability assert that dispensing prescription drugs without professional supervision
can have serious health repercussions.