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Two Reports Fault Drug Importation

Government Studies Cite as Concerns Cost of Setting Up Program, Safety

By Rick Weiss
Washington Post Staff Writer
Wednesday, December 22, 2004; Page A25

It is impossible to ensure the safety of imported drugs purchased individually by American consumers, and even a federally run program of bulk importation would pose medical and economic risks to consumers, according to a highly anticipated and instantly controversial pair of reports released yesterday by Bush administration officials.

The reports were ordered up last year by Congress after the Republican leadership thwarted efforts to pass legislation legalizing expanded importation. Their contents suggest that, despite hints to the contrary during his reelection campaign, President Bush may be in no hurry to liberalize rules governing the importation of cheaper drugs.

Sen. Byron Dorgan said drug firms profit excessively. (File Photo)

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The reports do not close the door on easier importation, an issue that has stirred deep emotions among Americans increasingly burdened by health care expenses. But they make plain that Canada is the only country in a position to serve as foreign supplier of reliable prescription drugs. And considering the expense of setting up even a limited system with that country -- and the harm that it may cause to U.S. drug companies -- consumers would ultimately benefit very little, the reports conclude.

"If Congress were to pass legislation that did not address the serious safety concerns . . . or if Congress were to pass legislation that discouraged innovation or stifled competition . . . the President's senior advisers would recommend a veto," wrote Health and Human Services Secretary Tommy G. Thompson and Commerce Secretary Donald L. Evans in a letter to congressional leaders accompanying the two reports.

Advocates of drug importation immediately denounced the reports as predictable position statements from the administration and the U.S. pharmaceutical industry. Lawmakers on both sides of the aisle predicted that the reports would only inflame public sentiment against the Food and Drug Administration and the drug industry, and vowed to push harder for legislation.

"The only thing endangered by allowing Americans access to lower-priced FDA-approved medicines from abroad is the incredibly large profits of the drug companies who over-price their medicines in our market, just because they can," said Senator Byron L. Dorgan (D-N.D.).

He has threatened to hold up Senate confirmation of Bush's nominee to head HHS -- Environmental Protection Agency Administrator Mike Leavitt -- over the issue.

One of the two reports -- a 130-page analysis by the HHS Task Force on Drug Importation, chaired by Surgeon General Richard H. Carmona -- confirmed that drug importation is common. Nearly 5 million shipments, comprising about 12 million prescription drug products valued at about $700 million, entered the United States from Canada in 2003 as a result of Internet sales and cross-border visits, the report said, and an equivalent amount is coming in from the rest of the world.

The problem, according to the report, is that most of those medicines were produced in laboratories and distributed by suppliers that are not under the watchful eyes of FDA inspectors, calling into question their purity and safety.

The FDA could never achieve proper oversight of so many individual shipments, the report said. The agency could, in theory, oversee a federal system of bulk shipments from a single nation -- Canada -- it said. But the $100 million-plus cost of putting such a system in place and the added cut that new middlemen would take would leave consumers saving only 1 to 2 percent, according to the task force, which included officials from agencies within HHS and others.

Moreover, the report suggested, the resulting decline in profits for U.S. drug makers would force them to reduce spending on research and development, ultimately depriving consumers of important new medicines.

That argument was disputed yesterday, given recent revelations about the potential risks of many popular FDA-approved drugs such as Vioxx, Celebrex and Aleve.

"The authors of this report don't cite a single example where an American has been harmed by an imported drug, and we have thousands of examples now where Americans were harmed by FDA-approved drugs," Rep. Gil Gutknecht (R-Minn.) said.

Coincident with release of the HHS report, the Commerce Department released "Pharmaceutical Price Controls in OECD Countries." That 125-document concluded that while nongeneric prescription drugs are indeed considerably cheaper in other countries -- in large part because of government-imposed price controls -- those reductions result in less innovation abroad.

The Pharmaceutical Research and Manufacturers of America, which represents the major drug companies, said the two reports' findings "substantiate that importation proposals represent a false promise to American consumers."

Public Citizen, a D.C. watchdog group, released its own 13-page report calling into question the government findings.

"Seven of 13 members of the Drug Importation Task Force are Bush political appointees, not career employees," the group noted. "Moreover, the administration included no independent outside experts on the task force."

Other groups were equally vocal.

"Rather than taking a year and spending taxpayer dollars to write a report that simply repeats the pharmaceutical industry's arguments against reimportation, the administration should have focused on developing a system to provide Americans with access to affordable prescription drugs," said Ron Pollack, executive director of Families USA, a nonpartisan D.C. group that advocates for affordable health care.

Staff writer Ceci Connolly contributed to this report.

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