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GOP Leadership Likely to Bottle-Up Drug Re-Importation Bill

  • July 30th, 2004

The failure of Medicare discount drug cards to provide meaningful drug savings to seniors is adding pressure on Congress to directly authorize re-importation of drugs from Canada. It's an election year and our Congressional representatives want to appear to be interested in meeting the needs of senior voters.

Two competing bills have been introduced to legalize the re-importation of drugs from Canadian pharmacies. Senate Bill 2328 is being co-sponsored by a bi-partisan group of senators, including Byron Dorgan (D-ND) and Olympia Snowe (R-ME). The Dorgan/Snowe bill is backed by consumer advocates and by AARP. It is vehemently opposed by the pharmaceutical companies.

The Dorgan/Snowe bill would allow U.S. consumers to directly purchase drugs from FDA-approved Canadian pharmacies. After 90 days, U.S. pharmacists and drug wholesalers would be allowed to re-import medications from Canada. The bill would also prevent pharmaceutical companies from reducing drug supplies to countries willing to export lower-cost pharmaceuticals to the U.S. Additional legislation would address safety concerns regarding the purchase of drugs over the Internet.

While the Dorgan/Snowe bill has bi-partisan support, it does not have the backing of the Bush administration or the Senate's Republican leadership and is unlikely to become law. Instead, Senate Majority Leader Bill Frist (R-TN) has indicated some support for a bill by Sen. Judd Gregg (R-NH). Gregg's bill is much more conservative than the bi-partisan bill that AARP endorsed. It would allow limited drug re-importation and includes provisions that would require greater regulation of Internet pharmacies.

While it is unlikely that Republican congressional leaders will allow the bipartisan Dorgan/Snowe bill to proceed, there is some chance that the more conservative Gregg bill will move forward in the short time remaining this year. However, there is concern that the pharmaceutical companies may try to 'hijack' this legislation by including provisions that would actually protect the pharmaceutical industry from competing with re-imported drugs by making drugs from foreign pharmacies more expensive for American consumers. So re-importation legislation could turn out to be a wolf in sheep's clothing.

While the re-importation legislation has been getting a lot of press, the Bush Administration has been quietly pursuing a different approach to drug re-importation issue. It has been including language in trade agreements that will restrict re-importation and even prevent other countries from negotiating for lower prescription prices than what exist in the U.S. The purported rationale is that U.S. consumers are bearing the brunt of drug company research and development costs.

At the very least, the argument goes, trade agreements should help protect the pharmaceutical companies' U.S. profit margins. The drug companies will apply some of these excess profits to research and development, and maybe even reduce prices in the U.S. a little. This may make some sense if you trust the drug companies to watch out for the interests of consumers. On the other hand, you are not alone if the 'make prices higher around the world' argument makes you feel like Alice in Wonderland.

This is a version of an article that appeared in the July 29, 2004, issue of Elder Care Law Alert, published by Pennsylvania elder law attorney Jeffrey A. Marshall. To visit attorney Marshall's ElderLawAnswers home page, click here.

For more information, news articles on the re-importation legislation are available at: http://www.thehill.com/news/071304/reimportation.aspx and

http://www.kansascity.com/mld/kansascity/news/9169985.html

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Last Modified: 07/30/2004

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