Drugmakers fight plan to allow drug reimportation
Tuesday, December 15, 2009
Drugmakers intensified their lobbying push Monday against a popular proposal to allow Americans to buy cheaper drugs from other countries, one of several heated disputes that have bogged down negotiations over a heath-care reform bill.
The talks prompted hospitals, insurers and other major industries attempting to steer the legislation in their favor to push for changes as lawmakers work through a handful of complex issues. Medical providers, for example, are battling a proposed Democratic compromise that would jettison a public insurance option in favor of a limited expansion of Medicare, while the U.S. Chamber of Commerce flew dozens of corporate executives to Washington last week to meet with lawmakers.
The fight over the proposal further complicates Democrats' efforts to build support for health-care legislation in the Senate. The dispute also poses a particularly difficult political challenge for President Obama, who co-sponsored a similar bill when he was in Congress and who included funding for the idea in his first budget.
The amendment, sponsored by Sen. Byron L. Dorgan (D-N.D.), would allow pharmacies and wholesalers to import U.S.-approved medication from Canada, Europe, Australia, New Zealand and Japan, where drug costs are far lower because of price controls. The measure has attracted bipartisan support from lawmakers, including Sens. Olympia J. Snowe (R-Maine) and John McCain (R-Ariz.).
But the pharmaceutical industry -- which has been a key supporter of health-care reform after reaching an agreement with the White House earlier this year -- has responded with a fierce lobbying campaign aimed at killing the proposal, focusing on Democratic senators from states with large drug and research sectors.
In addition, Margaret A. Hamburg, commissioner of the Food and Drug Administration, raised safety concerns about the Dorgan amendment in a letter to the Senate, warning that the agency is unable to ensure that such drug imports would not be counterfeited or contaminated. The FDA has cited such concerns for more than a decade, repeatedly rebuffing attempts by Congress to allow prescription drug imports.
The dispute traps Obama between his campaign rhetoric and the political realities of health-care reform, which depends in large part on tacit support from drugmakers and other industry groups. Under the earlier agreement with the White House, the pharmaceutical industry agreed to contribute $80 billion toward reform over 10 years in exchange for protection from further cuts.
"It's about being a candidate as opposed to being president," said Ken Johnson, senior vice president of the Pharmaceutical Research & Manufacturers of America (PhRMA). "When you become president, you realize that the sound bites don't always work in reality. . . . I think they've looked at the problems now and have concluded there's no way to ensure the safety of medicines reimported into the United States right now."
The White House is attempting to strike a balance, expressing approval of the idea to allow drug imports while bowing to the FDA's safety concerns. "The president supports reimportation of safe and effective drugs," White House spokeswoman Linda Douglass said, adding that the FDA "will continue exploring policy options to create a pathway" to allow the purchases.
An anticipated vote on Dorgan's amendment was initially blocked on Thursday by Democratic Sen. Thomas R. Carper of Delaware, home to the U.S. headquarters of pharmaceutical company AstraZeneca. Carper backs a different version of the legislation that supporters decry as a poison pill.
Carper said in a statement that he shares the FDA's concerns that "Senator Dorgan's amendment could potentially allow unsafe, counterfeited drugs into the United States, contaminating our drug supply. This is a complicated issue that affects people's lives. We should make sure that the FDA says it's safe before we reimport drugs from other countries."
McCain complained about the role of PhRMA, saying the powerful group "has been over here lobbying furiously" because the amendment "breaks the agreement that the White House made."
AARP, the powerful seniors' group that supports drug importation, has notified senators that it will keep close track of votes on the Dorgan amendment and will use the tally in its rankings of senior-friendly lawmakers. AARP Senior Vice President David Sloane said Friday that the legislation "would create a system for safe, legal importation of prescription drugs from abroad" and would help lower drug costs.
The Congressional Budget Office estimated the proposal would save the government $19 billion over the next 10 years, and Dorgan estimated that consumers would save $80 billion more. He pointed to vast price differences in drugs made in the same factories; an equivalent amount of the heartburn medication Nexium, for example, costs $36 in Spain and $424 in the United States, he said.
"The pharmaceutical industry wouldn't be able to impose these price increases because then you would have competition," Dorgan said on the Senate floor last week. "Freedom equals competition in my judgment here on this issue."