Importation bill has chance to offer example of concern for ALL U.S. citizens, leadership, innovation

The news hit with the suddenness of a surprise attack early Saturday, June 20—the Pharmaceutical industry had made a late night call to Senator Max Baucus (D-MT) to tell him that is was willing to cooperate by pledging $80 billion over the next decade in resolving one of the biggest problems (and resulting criticisms) of Medicare Part D, The Infamous Doughnut Hole.

The facts surfaced by Monday afternoon however, as it became evident that pharma’s move really was nothing more than a carefully crafted and possibly successful attempt to circumvent several challenges facing it—the possibility of price negotiation for Part D medicines, and the potential contribution that could be provided by allowing personal importation of safe, affordable medicines from licensed, registered pharmacies in Tier One designated countries.
The Doughnut Hole should have been called ‘The Black Hole.’ Seniors were forced to continue paying their premiums, but their coverage was ‘suspended’ when drug costs reached $2250. They had entered The Doughnut Hole, where they would pay 100 percent of their prescriptions for the next $3600—even though they still had to pay for their premiums (a windfall for insurance companies). After paying the $3600, the ‘catastrophic’ level was reached, and the seniors who had survived The Doughnut Hole, were eligible for renewed coverage with low cost co-pays.

The fiscal and medical hit upon the elderly was immediate. Many seniors simply quit taking their medicines or began ‘splitting’ pills. Either action not only derailed the claimed hoped-for goals of Medicare Part D, it caused untold numbers of elderly to gamble their health, well-being and perhaps even their lives by the self-denial of vital medicines that had been forced on them by a pharmaceutical-influenced Congress that enacted Part D. Billy Tauzin, the former Congressman from New Orleans who was instrumental for many of the 11th hour (and 59 minute) changes that shaped Part D was rewarded with a multi-million-dollar position by PhRMA, the influential and well-heeled trade group for the drug companies.

A proposed solution to relieving the burden of The Doughnut Hole dilemma—price negotiation for drugs-- soon became a favorite of politicians, and repeated calls were made from untold numbers of stumps, town hall meetings, and locales where the pols could promise the elderly that help was on the way.

With the election of President Barack Obama, a Democratic House and a Democratic Senate, negotiation seemed ready to be moved from stump speeches to reality.

But, it is said that politics makes strange bedfellows. And, the push for healthcare reform soon created a lot of odd sleeping arrangements. Many of us winced when PhRMA joined with FamiliesUSA, a leading progressive, hard-working and well-respected advocacy group, to work for ‘healthcare reform.’ What, we asked, was the industry looking for? Images of the Fox in the Henhouse, the camel with his nose under the tent, flashed though our minds.

Added to this was the White House meeting President Obama arranged with industry groups representing insurance companies, PhRMA, hospitals, and other healthcare industry groups. Our concerns were quickly validated when a White House statement about pledges to cut the growth of health care costs was actually nothing more than a pledge to reduce the rate of growth by not increasing prices as much as before. The President needs to remember what John Kennedy said about big business special interest groups and what a bunch of SOBs they were.

The fact is that the ‘pledge’ was actually not a true savings. It would be a bit like buying your groceries at a store that has raised its prices 20 percent for the past few years. But, to ‘save money’, it says it will raise its prices only 10 percent next year, so instead of groceries that cost $100 per week in year one, the next year they would cost $110 instead of $120. The store owner could then tell consumers that each had saved $10 in year two, even though they were paying more for the same groceries. Only the rate of the increase was less than in previous years.

This type of math should have been the tip-off that the pharma ‘commitment’ to aiding seniors in The Doughnut Hole isn’t what it at first seemed to be.

On Sunday, President Obama issued the following statement about the agreement with the drug companies:

"I am pleased to announce that an agreement has been reached between Senator Max Baucus and the nation’s pharmaceutical companies that will bring down health care costs and reduce the price of prescription drugs for millions of America’s seniors. As part of the health reform legislation that I expect Congress to enact this year, pharmaceutical companies will extend discounts on prescription drugs to millions of seniors who currently are subjected to crushing out-of-pocket expenses when the yearly amounts they pay for medication fall within the doughnut hole any payments by seniors not covered by Medicare that fall between $2700 and $6153.75 per year. The existence of this gap in coverage has been a continuing injustice that has placed a great burden on many seniors. This deal will provide significant relief from that burden for millions of American seniors.

"The agreement by pharmaceutical companies to contribute to the health reform effort comes on the heels of the landmark pledge many health industry leaders made to me last month, when they offered to do their part to reduce health spending $2 trillion over the next decade. We are at a turning point in America’s journey toward health care reform. Key sectors of the health care industry acknowledge what American families and businesses already know - that the status quo is no longer sustainable. The agreement reached today to lower prescription drug costs for seniors will be an important part of the legislation I expect to sign into law in October. I want to commend House chairmen Henry Waxman, George Miller and Charles Rangel for addressing this issue in the health reform legislation they unveiled this week. This is a tangible example of the type of reform that will lower costs while assuring quality health care for every American."
It was to be Monday before the facts began to surface. Simply put, PhRMA had negotiated an arrangement that would become law only if Congress enacted comprehensive healthcare reform, a part of which would include expanded coverage for more Americans, creating new, additional and profitable markets for the pharmaceutical industry. It is distressing to once again witness the ability of pharma to define issues to its advantage. Perhaps I need a refresher course in civics, but why does the industry have to ‘agree’ to cuts that are intended to be a part of the governing legislation enacted by the U.S. Congress? What option do they have?

Also, why is the Obama Administration so ready to heap praises upon the drug companies, all of which have reaped whirlwind, virtually ensured profits at the expense of the American public that has been denied access to the health benefits provided by access to vital medicines because it must pay the highest cost in the world for its prescription medicines?

But, it is an ill-wind that blows no good. Last Fall, before the elections, a group of advocates for senior advocacy groups from areas across the country, met in Washington, DC to shape support for personal importation of prescription medicines from Tier One countries. At that time, the participants reached a consensus that the importation concept should be included as a part of discussion about comprehensive healthcare reform, a ‘third-leg’ of the stool, because such access to vital medicines is essential to the health and well-being of Americans. It also urged consideration of the beneficial budgetary impact that could be provided though the inclusion of personal importation of prescription medicines into Part D thereby remedying plan shortcomings while saving money for the elderly, protecting their health and creating real savings for the Plan.

Sources tell us that moves have made recently by supporters of importation to define a stronger argument for importation of prescription medicines within the framework of the healthcare debate. We applaud such action. Now, there is an additional opportunity to address the benefits of improved health and savings by fine-tuning the healthcare debate to explore other opportunities for personal importation and defining a role for personal importation in Medicare Part D. Senators Dorgan and Snowe, the two legislators most identified with importation, have issued a statement that reflects their realization that the pharma 'offer' really does not address the challenge of lowering prescription drug prices. And, already, there is a growing realization that the pharmaceutical industry's motives are self-serving.

It is time to call out the pharmaceutical industry. There are legitimate questions that deserve answers about the motives of pharma. It has reaped the benefits of guaranteed pricing for Part D that has led to windfall profits. The claimed or hoped-for savings,while beneficial to individuals, is too little-too late for many elderly. As to the claimed savings to be scored by the Congressional Budget Office, there is a growing realization that possible trade-offs to gain pharma support might actually lead to increased--and virtually guaranteed--sales and earnings.

There is a role for personal importation in helping provide a solution to providing safe, affordable prescription medicines for all Americans. We believe the pharma moves should lead to increased discussion of creating such access, free of what we believe to be unnecessary delays by empowering Secretary Sebelius to designate Tier One countries whose standards of oversight, safety, and efficacy meet of exceed those of the U.S.

Dorgan-Snowe needs changes (Chapter 2)

Summary: Earlier, Daniel Hines, publisher of www.TodaysSeniorsNetwork.com and a long-time and continuing supporter of personal importation of safe, affordable prescription medicines from pharmacies in Tier One countries, expresses concerns about current limitations on personal importation in U.S. Senate Bill 525, popularly referred to as Dorgan-Snowe, and urged supporters and sponsors to consider ramifications of the proposed legislation upon access to prescription medicines via the Internet or mail-order—access, which ironically might actually be decreased because of changes in the operations of those pharmacies created by the legislation, sources of supply, and a need to adapt the legislation to the challenges and opportunities that personal importation can provide.In this post, he deals with specific issues:

(1) Importation of medicines is an established fact. The right of individuals to make purchases via importation is established by the fact that a medicine that is unaffordable is unavailable, and Americans therefore have the right to make such purchases. The support on behalf of such access was the result of a classic populist movement by Americans, primarily the elderly, against the predatory pricing practices of pharmaceutical companies.

(2) The bill as presented fails to address the important role of access to prescription medicines as a part of the tremendous opportunity to be a part of comprehensive healthcare reform, and is instead a ‘stand-alone’ bill. This is evidenced by the fact that while drafts of healthcare reform bills such as that of Senator Ted Kennedy (D-MA) have a brief mention of access to prescription medicines as a part of vital healthcare for all Americans, no mention is made of the potential contribution and benefit that could be made by expanded access to safe, affordable prescription medicines from licensed, registered pharmacies in Tier One countries. The supporters of importation on The Hill have missed a tremendous opportunity to establish a presence for importation of medicines to be integrated into the discussion over opportunities for importation of prescription medicines as a part of comprehensive healthcare reform.

(3) One of the biggest challenges facing elderly Americans is the tremendous price increases of prescription medicines in Part D and the larger ‘Doughnut Hole’ in which seniors in the plan are forced to pay out-of-pocket for their prescriptions, while still paying a premium for coverage they are not receiving until their out-of-pocket expenditures reach the catastrophic level. Many never do. That is why we supported the bill introduced in the last Congress by Representative Dennis Kucinich (D-OH) to include imported medicines into the choices for Part D recipients, and why many advocates of importation believe that, properly constructed, there is an opportunity for importation to not only serve the health needs of Americans, but to contribute to budget savings. Yet, there is no provision at this stage of the healthcare reform debate that is just evolving about such a role for importation as an element of Part D, another opportunity lost.

(4) The legislation does not address issues of sourcing of medicines from Canadian pharmacies that reflect changes over the years in Canadian pharmacy operating models. Instead, there is a trapdoor that will stop Dorgan-Snowe from reaching its hoped-for goals because in its first year it limits personal importation of medicines to those from Canadian pharmacies with the medicines coming from Canada only. This in spite of the fact that there are estimates that as much as 80 percent of the prescriptions being fulfilled by Canadian pharmacies comes from Tier One countries whose standards meet or exceed those of the U.S.. But these will not be allowed to be imported into the U.S. by Canadian pharmacies, even though large numbers of Americans are currently doing so, enjoying the health benefits of access to vital medicines that are safe and affordable.

(5) The safety of medicines from pharmacies in Tier One countries such as Australia, New Zealand, the European Community and Japan is an established fact. Ironically, they will be designated for purchase by U.S. consumers after the first year of the limitation in (2), but only from U.S. pharmacies or wholesalers. Why is there a year-wait for such access, particularly in light of the probable shortage of medicines available from Canadian pharmacies because they will be unable to fulfill orders by utilizing sourcing from those same countries?

(6) How eager are Canadian pharmacies to be the engine that drives Dorgan-Snowe? Projections of anticipated revenues by policy-makers fail to account for the possible loss of sales by Canadian pharmacies that will lose access to medicines from Tier One countries as noted above. More significantly, the tremendous drop in the number of mail-order or Internet pharmacies in Canada will have an impact on the funding of importation. The Canadian International Pharmacy Association reportedly has 21 members, a far cry from the 140 pharmacies cited by Senator Charles Grassley (R-IA) that he counts on to generate the sales and the revenues that will contribute to the implementation and administration of Dorgan-Snowe. Over the years, there has been a concern expressed by Canadian pharmacies and Canadian policy-makers over ‘bulk shipments’ to the U.S. Many Canadian authorities fear a scenario in which Canada becomes ‘America’s Drug Store.’ Although when wholesale shipments are authorized in a year there will be the opportunity for shipments to pharmacies and wholesalers in this country from sources other than Canada, what might be the impact if Canadian officials fear a loss of access to medicines for their own citizens? Perception molds reality. Also, how may Canadian pharmacies will choose to participate in Dorgan-Snowe, with its registration fees, posting a $1 million bond, and seeing their margins reduced by other fees based on sales? If they choose not to participate, but continue sales to U.S. citizens, how will the provisions of the bill be enforced? Will they be declared ‘bogus’ pharmacies even though they are operating under the jurisdiction of their particular Provinces? The risk is that untold numbers of Americans might be denied vital medicines, with possible severe health consequences.

(7) How will Americans replace the medicines from other Tier One countries such as Australia, New Zealand, Great Britain, Japan and the European Community that they are now receiving through individual purchases from legitimate, authorized pharmacies that are already complying with standards in their countries that meet or exceed those of the U.S.? These are medicines that are now available but which might be denied for twelve months. Why should there be a year-long wait to establish the arrangements for wholesalers and pharmacies that might want to establish U.S.-based operations to import medicines or to administer plans to provide huge numbers of U.S. citizens the health benefit of access to safe, affordable medicines, access which would otherwise might be denied. Why, when the safety and efficacy of these medicines is already proven, and will be accepted in a year by the U.S., should Americans be denied the ability to make such purchases individually at this or any other time?

(8) The safety of imported medicines from legitimate pharmacies is a fact of life. There are, as far as I have been able to ascertain, no recorded deaths from medicines imported by individuals from legitimate, authorized pharmacies outside the U.S. Sadly, the same cannot be said of medicines from U.S. pharmacies. As a writer for The American Enterprise Institute, hardly a friend of importation, noted: “Only the stupid, lazy or woefully uninformed," would purchase medicine from a bogus pharmacy,” citing the many reliable sources to utilize to verify the safety of pharmacies. As noted, it is a fact that legitimate, authorized pharmacies in a Tier One country of origin must meet standards that meet or exceed those of the U.S. And, all anyone has to do to verify a Canadian pharmacy is to visit the web site of The Canadian International Pharmacy Association. The tragedy of persons buying from counterfeit pharmacies is undeniable. But, no legitimate pharmacy will make a shipment without a physician’s prescription, nor will it ship a controlled substance. Ironically, Google alerts for prescription medicine prices, which once were reliable sources of news about pharmaceutical industry and medicines events and trends, now include numerous mention to ‘pharmacies’ selling a number of drugs—usually Viagra and related medicines—with no prescription required, a sure tip-off to an illicit pharmacy and proof that no amount of regulation can completely stop someone from purchasing from such operations. Common sense and individual responsibility have a role to play. Rather than limiting access to legitimate pharmacies, Dorgan-Snowe should expand it.

(9) The bill lacks the transparency that more citizen involvement could provide. The claim is made on the one hand that the reason for not having hearings on the bill’s proposed language is that it is virtually the same bill that has been offered in the past so there is no need for Congressional hearings. Even granting the validity of this, the fact remains that the circumstances surrounding the bill have changed. Dorgan-Snowe is a bill that, when the importation issue first arose, had defining purposes—safety, efficacy of drugs, improved public health and lower costs for medicines It was a recognition by the supporters of importation that there were benefits to be obtained from allowing Americans access to safe, affordable prescription medicines from other countries, but that there was also a need to reassure patients and families that the proper oversight would be provided to help them identify pharmacies offering those medicines. What have changed are the forces of importation, forces that will shape and determine the success of providing safe, affordable medicines to Americans , not merely measured by passage of the bill.

These forces are described above. But, for importation of medicines to achieve its hoped-for benefits of improved health and well-being of Americans through access to a regimen of vital medicines, some ‘old ground’ will have to be gone over again. We encourage the policy-makers inside the Beltway to welcome the opportunity for additional input and fine-tuning of Dorgan-Snowe that will ensure the success of the legislation for which they have worked so hard for so long. Without such consideration, the consequences might be that the legislation might actually have an impact completely opposite of what is hoped for and cause a reduction in the ability of Americans to benefit from access to safe, affordable imported medicines.

Dorgan-Snowe needs changes

Sometime ago, we published a blog suggesting that problems that we perceived with the proposed prescription medicine importation bill, based on our understanding of input from key staff and communications with other supporters of the concept of the prescription medicine importation led us to fear that key elements of the concept that have long been supported by groups and advocates might somehow not be included in the new legislation.

It was that concern that prompted us to call for increased public participation in the development of the language. Irrespective of what the outcome might have been for our appeal, we believe that such involvement is not only a right given to U.S. citizens, but an obligation for those whom we elect to serve and govern--not rule.

Our specific concerns were that we and others have long believed that it is the right of U.S. citizens to make purchases from Tier One countries, where the regulations, oversight and supervision of pharmacies meet or exceed those of the United States.

We were challenged on this by a visitor to the article who wanted our source to validate the statement. She speculated that it was likely a political reference and tht the FDA had not reached such a conclusion. Of course, she was right on the latter aspect, since the FDA would never face the wrath of pharma by stating the obvious. In the former instance, though, she was just wrong. The fact is that each of the Tier One countries have outstanding regulatory oversight, and it is well-recogized by healthcare professionals and authorities around the world that not only do those countries have standards that meet those of the U.S. and the FDA, but that we as a country are unforunately far behind the standards of those countries.

Which leads to our former concerns about the proposed importation legislation that was was introduced on March 4. We feared that the ability of U.S. citizens to purchase physician-prescribed medicines from Tier One countries was to be limited, and would allow the purchase of medicines from those countries only if they were first purchased by a U.S. importer (a pharmacy, group of pharmacies, or a wholesaler) for resale to Americans.

This seemed to be an unnecessary restriction that would only add to the costs, while doing nothing for safety or efficacy of the medicines.

Unfortunately, the latest 'wrap' explanation of the bill seems to reinforce this view.

After much discussion, and readings of the bill regarding the limitation on individual purchases we came to the mistaken conclusion that the Secretary of HHS would be able to 'designate' particular countries as having standards of oversight and regulation that met or exceeded those of the U.S. and that individuals would be allowed to make purchases from those countries.

The latest explanation of the proposed language has disabused us of our mistake. To the contrary of what we believed, it reinforces our earlier fears and limits direct purchase to mail-order or Internet pharmacies located only in Canada.

This would take effect 90 days after the passage and signing of any importation bill. At the same time, it would be a year before the 'commercial' setup that would allow American citizens to purchase those same medicines from designated countries, and then only from a wholesaler or a U.S. pharmacy.

As one who has supported the concept of importation of medicines from legal, authorized, licensed pharmacies for nearly six years, it is difficult to express my dismay at this short-sighted approach to increasing the access of Americans to safe, affordable prescription medicines--especially at a time when growing numbers of elderly are either reducing or doing without vital medicines because of the problems associated with the Doughnut Hole. And that is only the tip of the iceberg.

Millions of Americans irrespective of their age simply cannot afford their medicines, so they too do without. Ironically, this occurs at a time when there is a solution--expand the ability of Americans to have increased access to safe, affordable medicines, exercising their own good judgment by utilizing the many sources that identify legitimate, safe pharmacies in Tier One countries.

As a writer from the American Enterprise Institute (no friend of importation) noted recently, "Only an idiot would purchase 'medicine' from a bogus pharmacy" because there are many sources than can identify legitimate pharmacies.

The legislation has been referred to the Senate Health, Education, Labor and Pensions Committee and to the House Energy and Commerce committee. Hopefully, there will be hearings at which public testimony will be solicited--and listened to--as part of the democratic process.

I have been told that I am covering old ground. Perhaps that is true. But the facts are evident: importation from licensed, registered pharmacies is a fact and even with (or perhaps because of Part D), it offers a reasoned solution to allowing Americans to have access to vital medicines; to the best of my knowledge, there have been no deaths from any medicines from these pharmacies; no controlled substances have been shipped to this country from these pharmacies.

And,whereas there was no track record when the push for importation first began, and it would have been necessary to establish safeguards to protect and reassure the American public, there is no guarantee that even with passage of the legislation in its current form that it will end or even curtail bogus pharmacies, sales of controlled substances or sales of counterfeit drugs.

The concept of importation, free choice and equitable pricing, with the goal of improved health that can be attained through a regimen of access to safe, affordable medicines remains valid. The challenge now: to establish the framework that will make it happen.