Scott signs drug-import expense however offers no assurances

Gov. Phil Scott fields questions about his finance proposal on Thursday. Photo by Mike Dougherty/VTDigger

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Gov. Phil Scott. Photo by Mike Dougherty/VTDigger

Although Vermont now has a law calling for importation of cheaper prescriptions from Canada, officials caution that such a program may never become reality.

Gov. Phil Scott has signed , which orders the state Agency of Human Services to design a prescription-drug importation program linking Vermont with Canada in order to create “significant” cost savings for consumers.

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But years of work and many obstacles remain. Human Services Secretary Al Gobeille said the biggest of those obstacles is receiving the federal government’s approval, without which the venture can’t get off the ground.

“This is not something we’re in control of whatsoever,” Gobeille said.

State and federal officials are trying to tackle the problem of pricey prescription drugs, which are burdening consumers and helping to drive up insurance rates.

President Donald Trump recently announced a plan to address the issue, though his proposals were panned by Vermont’s congressional delegation. That was in part because Trump is not pursuing importation of cheaper drugs from Canada.

S.175 attempts to do just that, but in a way that would be limited to Vermont. In fact, the statute’s final version specifically outlaws “the distribution, dispensing or sale of” Canadian drugs outside the state’s borders.

First, though, officials have to figure out how to get Canadian drugs into Vermont. And that’s a far more complicated matter.

The statute says the Human Services Agency must come up with a program that either designates a state agency as a licensed drug wholesaler or contracts the state with such a wholesaler. That wholesaler would use Canadian drug suppliers, but only to the extent that officials can ensure that the imported drugs meet the U.S. Food and Drug Administration’s “safety, effectiveness and other standards.”

The state also would import “only those prescription drugs expected to generate substantial savings for Vermont consumers.”

Ensuring the safety of Canadian drugs was a point of contention during the debate over S.175. But Scott dismissed such concerns.

“Our Agency of Human Services will be working hand-in-hand with others to make sure it’s safe,” Scott said. “So I’m confident in our Agency of Human Services.”

During his weekly press conference, the governor also said he is “in favor of doing whatever we can to reduce the cost on Vermonters.”

Scott added a cautionary note: “I’m not sure what the outcome’s going to be, but we’ll do the best we can.”

Al Gobeille, secretary of the Agency of Human Services. Photo by Anne Galloway/VTDigger

That’s the only promise Gobeille can offer, too. Having previously called Canadian drug importation “a long shot,” Gobeille on Thursday said the outcome remains in doubt because of a series of actions required at the state and federal level.

The statute says that, by Jan. 1, the Human Services Agency must submit its proposed plan for drug importation to the Legislature. Lawmakers must agree on a “charge per prescription or another method of financial support for the program” before it can move forward.

There’s another deadline looming next year: The agency has until July 1, 2019, to “submit a formal request to the secretary of the U.S. Department of Health and Human Services for certification of the state’s wholesale prescription drug-importation program.”

S.175 also notes that the agency must seek “the appropriate federal approvals, waivers, exemptions or agreements” to ensure that those entities who choose to participate in the state’s importation program don’t jeopardize their eligibility for the federal 340B drug discount program.

So the agency will be simultaneously preparing for the required federal submissions and developing the nuts and bolts of the importation program. That could be a strain on state resources, and Gobeille said there is currently no money allocated in the fiscal year 2019 budget to support that work.

However, Gobeille noted that the National Academy for State Health Policy “has offered free consulting purposes to do the work to augment our staff, which would be really helpful.” The academy — which has offices in Washington, D.C., and Portland, Maine — has been supportive  of Vermont’s importation efforts.

Gobeille said the state’s efforts are a small price to pay for cheaper prescriptions. “If at the end of the day this act was to significantly lower prescription drug prices for Vermonters, we don’t mind doing the work,” he said.

But there are no guarantees that all the necessary pieces will fall into place.

Gobeille said he has “nothing but respect” for the authors of S.175. However, he said state officials “just don’t know what the federal government’s response will be or what the complications will be once we look at the impact to our programs.”

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