Florida AHCA Submits Concept Paper to HHS

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Recently, the Florida Agency for Health Care Administration (AHCA) recently submitted a “concept paper” to the United States Department of Health and Human Services (HHS) outlining its proposal to implement a state drug importation system. The plan broadly describes how state health officials would import cheaper pharmaceuticals from Canada and potentially save the state more than $150 million a year.

Background

The submission of the concept paper was a long time coming. In 2003, Congress passed the Medicare Prescription Drug, Improvement, and Modernization Act, which allowed for United States wholesalers and pharmacists to commercially import prescription drugs from Canada, provided certain circumstances are met. While the law has yet to be implemented, the Act requires the HHS Secretary to certify that a federal importation program will pose no additional risk to the public health and safety and will result in significant cost savings before any drug importation plan can take effect.

During the 2019 Florida Legislative session, Governor Ron DeSantis signed HB 19 into law, which establishes the Canadian Prescription Drug Importation Program within ACHA.

Then, in late July, HHS and the United States Food and Drug Administration (FDA) announced its “Safe Importation Action Plan,” detailing two pathways to allow the importation of prescription drugs, the first of which would allow a demonstration project to import drugs from Canada under conditions to ensure no additional risk and significant cost savings.

In the press release announcing the submission, Florida Governor Ron DeSantis said “Two months after signing Florida’s Prescription Drug Importation Program into law, I am pleased to announce that our state is one step closer to realizing true cost savings on safe, high quality prescription drugs from Canada.”

The Concept Paper

According to the concept paper, Florida plans to hire a vendor to oversee the program as well as all eligible drugs and suppliers, in addition to utilizing existing FDA regulations governing pharmaceutical repackagers and relabelers to ensure drugs imported are safe and effective.

Florida’s plan would target only the pharmaceuticals with the greatest potential savings for the state and the only importers eligible under the plan would be limited to wholesalers and pharmacists serving state health program. The importation plan also excludes various classes of drugs that are inhaled or injected rather than consumed, as well as controlled substances or biological products, such as insulin.

AHCA stated that the plan would ensure compliance with federal law requiring that the state:

  • Track and trace requirements for imported drugs;
  • Sample the purity, chemical composition, and potency of the imported drugs;
  • Review laboratory records, including complete data derived from testing;
  • Review labeling standards for prescription drugs; and
  • Ensure that drugs are not imported that are identified in the Act as being excluded.

AHCA will be responsible for developing the actual regulations covering any importation program, and Governor DeSantis noted that the concept paper could be used as a model “to inform HHS as they develop rules in line with President Trump’s recent directives on the importation of prescription drugs.”

This submission puts additional pressure on HHS Secretary Alex Azar to fulfill President Trump’s priority and provide a response to the states’ formal submission. Even if Florida’s plan is approved by HHS, the importation program will face one more hurdle before being implemented: the Florida legislature will need to approve funding for the importation program.

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