{"id":5680,"date":"2020-09-25T18:00:52","date_gmt":"2020-09-25T23:00:52","guid":{"rendered":"https:\/\/www.appliedpolicy.com\/staging\/7403\/?p=5680"},"modified":"2021-06-15T09:45:38","modified_gmt":"2021-06-15T14:45:38","slug":"fda-finalizes-regulation-and-guidance-for-prescription-drug-importation-cms-guidance-discusses-impact-on-medicaid-drug-rebates","status":"publish","type":"post","link":"https:\/\/www.appliedpolicy.com\/staging\/7403\/fda-finalizes-regulation-and-guidance-for-prescription-drug-importation-cms-guidance-discusses-impact-on-medicaid-drug-rebates\/","title":{"rendered":"FDA Finalizes Regulation and Guidance for Prescription Drug Importation; CMS Guidance Discusses Impact on Medicaid Drug Rebates"},"content":{"rendered":"

[vc_row][vc_column][vc_column_text]The Food and Drug Administration (FDA) has issued a final rule<\/a> to allow for the importation of certain prescription drugs from Canada. In conjunction with the final rule, the FDA also released guidance<\/a> for manufacturers that lays out a pathway for manufacturers to import their own drugs. The rule has not yet been published in the Federal Register but will become effective 60 days after it is published.<\/p>\n

This final rule and guidance come after the release of an Executive Order (EO) in late July 2020 that directed the FDA to finish rulemaking for drug importation; the proposed rule and draft guidance were initially released in December 2019. The final rule and guidance do not address personal importation of drugs, which was included in the EO.<\/p>\n

Shortly after release of the final rule and guidance, the Centers for Medicare and Medicaid Services (CMS) released guidance for both states<\/a> and drug manufacturers<\/a> on how importation will impact the Medicaid Drug Rebate Program (MDRP).<\/p>\n

States to Be Allowed to Import Certain Prescription Drugs<\/h2>\n

Under statute, the importation of prescription drugs from Canada is allowed under certain conditions if certified by the Secretary of the Department of Health and Human Services (HHS). The Secretary must certify that importation will \u201cpose no additional risk to the public\u2019s health and safety\u201d and \u201cresult in significant reduction in the cost of covered products to the American consumer.\u201d With this final rule, the administration is creating a framework to allow time-limited Section 804 Importation Programs (SIPs), which would be authorized by the FDA.<\/p>\n

States (including the District of Columbia and territories) and Indian Tribes may sponsor SIPs; pharmacists and wholesalers can act as co-sponsors. A SIP must specify which drugs are included and sponsors will be required to explain how they will ensure that the importation program will result in a significant reduction in cost to the American consumer of the included products. A SIP can be extended by the FDA before the end of its authorization period and the FDA can also terminate a SIP for specified reasons, including not meeting relevant safety criteria.<\/p>\n

SIP Proposals must identify a Foreign Seller in Canada that is licensed to wholesale drugs by Health Canada and registers with the FDA. The Foreign Seller will purchase the eligible drug directly from the manufacturer and then the Importer in the U.S. will buy the drug directly from the Foreign Seller. An Importer is a pharmacist or wholesaler that is state-licensed for a pharmacist and state- or FDA-licensed for a wholesaler. The importer\u2019s license must be issued by a state that is a SIP Sponsor.<\/p>\n

The initial SIP Proposal will include just one Foreign Seller and one Importer. A supplemental proposal to add additional sellers and importers can be submitted if the SIP can demonstrate it has consistently imported drugs in accordance with the relevant statute and regulations. However, each supply chain under a SIP can only be three entities- one manufacturer, one Foreign Seller, and one Importer.<\/p>\n

The final rule also includes legal language indicating that the entire regulation will not be effective if any provision of it is struck down in court.<\/p>\n

Biologics, Controlled Substances, Infused and Injected Drugs Not Eligible for Importation<\/h2>\n

Eligible drugs are those that could be sold legally in either the Canadian or American market with appropriate labeling. Several categories of drugs are excluded from importation:<\/p>\n