FDA’s Authority to Restrict Importation of Prescription Drugs from Canada Upheld
November 21, 2003
The U.S. Food and Drug Administration (FDA) secured a victory in retaining its sole authority under the Federal Food, Drug, and Cosmetic Act (FD&C Act), 21 U.S.C. § 301 et., to regulate the safety and effectiveness of prescription drugs offered for sale in the United States when, on November 6, 2003, Judge Claire V. Eagan of the U.S. District Court in Tulsa, Oklahoma, granted a motion for preliminary injunction to restrain and enjoin Oklahoma-based storefront pharmacy chain Rx Depot, Inc. (Rx Depot), Nevada-based Rx of Canada, LLC (Rx Canada) and other individuals from directly or indirectly "causing" prescription drugs to be imported into the United States from Canada.
United States v. Rx Depot et al.
Rx Depot, in conjunction with Rx Canada and other individuals, had been assisting U.S. customers in obtaining prescription drugs from Canada by sending the customer’s prescription from a U.S. physician, with credit card information and/or a certified check and other paperwork to a cooperating pharmacy in Canada. After the prescription had been rewritten by a Canadian physician, the Canadian pharmacy that filled the prescription would ship the prescription drugs directly to the U.S. customer and bill the U.S. customer’s credit card and/or deposit the certified check. Typically, Rx Depot/Rx Canada received a 10 to 12 percent commission for each sale they facilitated for the Canadian pharmacies, in addition to commissions for any refill orders.
In finding that the "defendants openly and notoriously violate[d]" numerous provisions of the FD&C Act by facilitating the illegal importation of prescription drugs, Judge Eagan found issuance of a preliminary injunction to be warranted because the evidence before the court conclusively demonstrated that the defendants’ violations would have continued absent an injunction. Moreover, the U.S. Congress had addressed this issue previously and found "that the unrestricted reimportation of U.S.-manufactured drugs created ‘an unacceptable risk that counterfeit, adulterated, misbranded, subpotent, or expired drugs will be sold to American consumers.’ P.L. 100-293, Sec. 2…" In spite of the obvious advantages afforded by cheaper prescription drugs to individual customers, Judge Eagan also concluded that "Congress, not this Court, is the best forum for weighing all of the costs and benefits of the national statutory scheme regulating prescription drug importation." Finally, Judge Eagan found it "reasonable…for FDA to marshal its limited resources against large-scale, commercial operations such as Rx Depot/Rx Canada rather than small-scale violators."
FDA’s Personal Importation Policy
Under certain limited circumstances, the FDA will allow the "personal importation" by individuals of otherwise illegal drugs for their personal use. (See FDA Regulatory Procedures Manual, Chapter 9, Subchapter: Coverage of Personal Importation.) Under this policy, the FDA may permit individuals and their physicians to bring small quantities of drugs sold abroad for a patient’s treatment of a serious condition for which effective treatment may not be available within the U.S. borders. This approach has been narrowly applied to products that do not present an unreasonable risk and for which there is no known commercialization and promotion to persons residing in the United States. A patient seeking to import such a product must also provide the name of the licensed physician in the United States who is responsible for his or her treatment with the unapproved drug product. Importantly, this policy is not intended to allow importation of overseas versions of drugs that are approved in the United States particularly when the versions of such drugs are being "commercialized" to U.S. citizens. (Overseas versions are often what Canadian pharmacies offer to sell to U.S. consumers.) Moreover, the policy simply describes the agency's enforcement priorities; it does not change the law. Judge Eagan addressed the relevance of this exemption to Rx Depot/Rx Canada but found it inapplicable on the basis that "this policy of enforcement discretion does not apply to commercial operations… ."
Congressional Legislation
Notwithstanding the FDA’s recent victory, its authority to regulate the safety and effectiveness of prescription drugs in the United States may soon be tested once again. Currently under consideration by Congress is the "Medicare Prescription Drug, Improvement, and Modernization Act of 2003," which may be enacted into law within the next few days. If passed, the legislation would require the Secretary of the U.S. Department of Health and Human Services (HHS) to establish, upon certification of safety and cost savings, a program that would allow for the importation of drugs from Canada by pharmacists, wholesalers and individuals. It also would continue the limited exemption relating to the importation of prescription drugs for personal use with specific provisions applicable to Canada only in this regard. However, based on concerns that imported drugs would not be as safe as the U.S. supply, HHS Secretary Tommy G. Thompson has promised to withhold the requisite certification as required by the legislation.
