Vermont – The National Academy for State Health Policy

Uncertainty for Marketplace Affordability as Congress Continues to Debate Reconciliation Bill

July 18, 2022/in Health Coverage and Access, Policy California, Colorado, Connecticut, District Of Columbia, Maine, Maryland, New York, Vermont Blogs, Featured News Home State Insurance Marketplaces /by NASHP Staff

Drug Price Transparency Laws Position States to Impact Drug Prices

January 10, 2022/in Prescription Drug Pricing California, Maine, Nevada, Oregon, Vermont Blogs, Featured News Home Prescription Drug Pricing /by Johanna Butler and Jennifer Reck

Drug price transparency laws enable state policymakers to understand opaque drug pricing and payment systems to formulate appropriate policy solutions to high prices, while also creating the data infrastructure to effectively realize those policy solutions. Since Vermont passed the first state drug price transparency law in 2016, more than a dozen states have enacted and implemented similar laws.

State-level transparency legislation shines light on drug pricing by requiring manufacturers and other supply chain entities such as prescription drug benefit managers (PBMs), health plans, and wholesalers to provide information on drug pricing. Transparency programs also establish accountability around manufacturers’ price increases or high launch prices. Since programs began collecting pricing data, states have seen fewer drug price increases trigger reporting requirements; however, launch prices and overall spending on prescription drugs have continued to increase.

Transparency laws can also create a foundation for additional strategies to lower drug costs. Policies like prescription drug affordability boards (PDABs), rely on having access to and expertise with drug pricing data. This blog provides an update on state drug price transparency laws and their impact.

Current State Transparency Landscape

Vermont passed the first state drug price transparency law in 2016. Since then, 13 other states have passed transparency laws focused on drug manufacturers and other actors within the supply chain – CA, CT, ME, MN, NV, NH, ND, OR, TX, UT, VA, WA, and WV. Most state programs require reporting from manufacturers when they increase the wholesale acquisition cost (WAC) of a drug above a certain threshold or if they introduce a drug with a high launch price. Several states also require reporting from insurers and pharmacy benefit managers. A few states extend reporting to other supply chain actors – pharmacy service administrative organizations (WA) and wholesale distributors (ME, NV, VA).

Transparency programs vary state-by-state regarding which drugs are reported on, the level of data collected (in aggregate or on an individual drug level), and how data is published and analyzed by the state.

Maine’s transparency program offers one of the more robust approaches to drug price transparency. Maine collects and analyzes data with the goal to identify each supply chain entity’s average net income, including data on manufacturers, PBMs, insurers, pharmacies, and wholesale distributors. This allows the public and policymakers to “follow the money” through the supply chain.
California’s transparency program posts launch price information and five-year schedules of price increases reported by manufacturers to its website, creating one of the only freely available sources of WAC data.
Oregon’s transparency program holds an annual public hearing that acts as a forum for sharing data analysis, discussion with stakeholders, and policy recommendations.
Nevada took a unique approach with its transparency program, first focusing reporting on diabetes drugs when its program was enacted in 2018 and then including asthma medications in 2019. In 2021, the state expanded its program to include all prescription drugs.

Impact of Transparency Programs

As states investigate and work to lower high drug costs, drug price transparency has become an important foundation and launch pad for efforts to lower costs. Data collected by state transparency programs can provide insights into the types of price increases and types of drugs driving high spending in a state. Pricing data can provide policymakers state-specific information to direct policy.

Moderated Price Increases Over Time

Since state transparency laws were first enacted, the number of price increases that trigger reporting based on state thresholds has decreased over time. Vermont’s Medicaid program explained in its 2020 report that compared to 2016, there was a 79 percent decline in the number of drugs reaching the state’s per year price increase threshold. The program report concludes that fewer manufacturers are excessively increasing the price of drugs. Similarly, Oregon’s transparency program reported that compared to its first year of implementation in 2019, the program received 70 percent fewer reports for price increases in 2020. However, during that same time, Oregon saw a 15 percent increase in the number of drugs with high launch prices.

Vermont and Oregon’s findings align with what drug pricing researchers have found – from 2016 to 2020 the amount of WAC price increases have decreased but launch prices have continued to rise. Although the rate of price increases may be moderating, launch prices may still cause increased state spending on prescription drugs.

Accountability for High Launch Prices

Transparency programs can establish accountability around manufacturers’ high drug price increases and high launch prices. For example, manufacturers of Semglee, the first generic insulin product deemed interchangeable by the U.S. Food and Drug Administration, recently announced it will price the new insulin product at almost $270 per vial, only $20 cheaper than Lantus, the brand-name biologic competitor. Based on this launch price, Semglee would trigger Virginia’s reporting requirements under the state’s 2021 transparency law which requires manufacturers to report information on the launch of biosimilar products that are not at least 15 percent below the cost of the reference biologic. While the law is not yet implemented, Virginia’s program would be one of the most immediate tools to create some accountability for Semglee’s high list price.

Data Infrastructure for Policy Solutions

In addition to establishing accountability, transparency programs can provide the necessary data infrastructure for the successful implementation of efforts to lower drug prices. Since 2020, several states have enacted prescription drug affordability boards (PDAB), entities with the authority to review high cost drugs and in some states set an upper payment limit to ensure no one pays more than that amount in the state. A first step for a PDAB to review high drug costs and potentially set payment limits is to gather the necessary drug pricing data – whether that’s leveraging existing data sources or establishing manufacturer or insurer reporting like transparency programs. States without transparency laws already in place must include transparency requirements. For example, Colorado’s PDAB law, enacted in 2021, requires insurers to report top-spend drugs to help inform which drugs the PDAB will review.

States that already have transparency programs in place however, are well-positioned to take steps to rein in high drug costs through a PDAB. Oregon’s new PDAB law leverages the state’s existing drug price transparency programto identify high-cost drugs that should be reviewed by the board. Each quarter the transparency program will provide the PDAB with a list of drugs with high price increases or high launch prices as well as a list of insulin products sold in the state in the previous year. Based on this information, the PDAB will identify nine drugs and one insulin product to review. Oregon’s PDAB will be supported and housed in the same agency that manages the drug price transparency program, the Department of Business and Consumer Services, allowing the PDAB to capitalize on the drug pricing data expertise developed by the transparency program since it was enacted in 2018.

In these ways, transparency can be seen not only as a steppingstone to future action, but often a necessary building block to sustain other efforts. The data gathered and expertise developed by transparency programs could be applied to any number of drug pricing policies beyond PDABs – direct negotiations for supplemental Medicaid rebates, implementing reference rates, or prohibiting price gouging.

Federal Efforts on Transparency

While a variety of federal transparency efforts are in process, state transparency programs go beyond proposed or recently enacted language. The Build Back Better Act that passed the House in November 2021 but continues to be debated in the Senate, would require pharmacy benefit managers to report certain information related to spending, cost, utilization, and formulary placement to health plan sponsors. Additionally, the Centers for Medicare and Medicaid Services (CMS) recently published an interim final rule requiring health plans to report certain information on the most costly drugs, most frequently utilized drugs, and drugs with the greatest year over year spending increases, among other data elements, to the Departments of Health and Human Services, Labor, and the Treasury. This interim final rule is similar to the insurer reporting requirements of many existing state transparency programs. For states that do not have transparency laws, this federal data, if shared with state leaders, could be helpful to identify top-spend drugs in each state and fuel other strategies to lower costs such as a PDAB. However, it’s unclear to what extent the data could be accessed or used by states, though states are eager to coordinate with the federal government to enhance data-sharing on drug prices. Importantly, none of these initiatives focus on requiring reporting from manufactures – who actually set drug prices – leaving state officials to continue this important work.

To learn more about state transparency legislation, review the National Academy for State Health Policy’s state strategy implementation tracker or the Transparency Law Comparison Chart.

State Policy Actions to Decriminalize Controlled Substances

July 26, 2021/in Opioid Center Oregon, Vermont, Washington Blogs, Featured News Home Behavioral/Mental Health and SUD, Opioid Use Disorder /by Eliza Mette and Jodi Manz

In the wake of a nearly 30% increase in drug overdose fatalities within a single year, states have been grappling with how to reduce overdose deaths, including exploring new approaches to penalizing the use of substances. Aligning to Biden administration priorities to increase access to treatment services and address racial inequities in drug policy, some state approaches specifically target interventions to respond to disproportionately high numbers of Black and Latinx Americans who are currently incarcerated for drug violations.

Since the fall of 2020, three states have enacted legislation that eliminates criminal penalties for some or all controlled substances, including, for example, methamphetamine, heroin, cocaine, and psilocybin. Some of these laws call for a significant overhaul of the state’s criminal code and revamp of substance use disorder (SUD) treatment infrastructure, while others simply decriminalize threshold amounts of certain controlled substances.

In November 2020, Oregon was the first state in the nation to decriminalize the possession of small amounts of all scheduled drugs for personal use through policy established by Ballot Measure 110. The law removes barriers to treatment and recovery services for people with SUD and eliminates criminal penalties for drug possession.
In May 2021, Washington took action by passing a law that similarly removes criminal penalties for drug possession and establishes a comprehensive plan to increase access to and engagement in treatment for SUD.
In June, 2021, Vermont’s governor signed H. 225 into law, making Vermont the first state to specifically decriminalize possession of non-prescribed buprenorphine. The new law also refers individuals under 21 found in possession if 224 milligrams or less of buprenorphine to a state-run court diversion program, and individuals under 16 found in possession of 224 milligrams or less of buprenorphine to delinquency proceedings in state family court.

Several other states introduced legislation in 2021 to decriminalize possession of scheduled substances that failed to pass. Maine’s proposed legislation died, while proposed measures in New York and Rhode Island were not decided upon before legislative sessions ended or went into recess. Massachusetts’ proposed legislation is still under consideration and will be further discussed at a hearing scheduled for September.

The table below summarizes themes across states with 2020-2021 legislation that decriminalizes at least one controlled substance.

Key features of state drug decriminalization legislation (enacted and proposed)

	NY*	OR	RI*	MA*	WA	VT
Eliminates criminal penalties	X	X	X	X	X
Imposes fine and/or screening	X	X	X	X	X
Tasks/creates a committee with assessment and recommendations	X	X			X
Establishes a SUD treatment funding plan		X			X
Language regarding SUD as a disease	X				X
Language regarding ineffectiveness of punitive interventions	X	X			X
Language regarding social determinants of health/racial equity	X			X	X
Amends paraphernalia law	X				X
Referral to treatment or counseling	X	X	X		X
Specifically decriminalizes possession of small amounts of non-prescribed buprenorphine						X

*Indicates proposed legislation

Expanded SUD treatment and recovery services, funding for those expanded services, and impacts on sentencing are emerging as themes in decriminalization policy out of recent introduced and enacted state legislation:

Oregon will fund existing government and community-based organizations to create Addiction Recovery Centers to provide people who use drugs with both acute care for immediate needs as well as intensive case management and referral services. Expanded treatment services provided in Oregon will be funded through marijuana tax revenue and savings from avoided drug-related arrests, incarceration, and prosecution. This is projected to provide over $100 million for services in the program’s first year.

Washington will develop a substance use recovery services plan that will connect people with SUD to low barrier treatment and recovery support services. The state has allocated just under $100 million in general funds to provide support to each local behavioral health administrative services organization for the development of recovery navigator programs. Both Washington’s and Oregon’s behavioral health administrative services organizations are also tasked with developing a recovery navigator program, which will be modeled after existing recovery programs and will be responsible for providing community-based outreach as well as intakes, assessments, and connection to ongoing treatment services.

In tandem with signing H. 225 into law, Vermont’s governor released an executive order, which cites the increase in fatal and non-fatal opioid overdoses, driven by COVID-19, as the impetus for the bill and indicates that decriminalizing buprenorphine is intended to decrease opioid overdose deaths and increase engagement in treatment for opioid use disorder (OUD). The executive order establishes the Decriminalized Buprenorphine Taskforce, which is responsible for assessing the impact of the new law and reporting them back to the governor.

Looking forward

Policy makers anticipate these laws will help address historic overrepresentation of people of color in corrections systems: Oregon estimated that its new law will result in a nearly ninety-one percent overall decrease in convictions with a projected 93.7% reduction among Black Oregonians and 94.2% reduction among Native American Oregonians. Washington’s newly created Substance Use Recovery Services Advisory Committee is tasked with creating recommendations on the collection and reporting of drug possession-related interactions with law enforcement and prosecutors; the Committee will report on racial, demographic, and geographic disparities therein. New York’s proposed legislation acknowledged that Black and Latinx communities have been disproportionately affected by drug criminalization laws, noting that policy change is intended to shift the state’s “approach to drug possession from one based on criminalization and stigma to one based on science and compassion.”

As overdose deaths have continued to rise – both before and during the COVID-19 pandemic – decriminalization represents a shift in how states might address the SUD crisis. New policies have the potential for far-reaching impact not only within state treatment systems but also across courts, pre-trial services, and incarceration settings as well. As these laws take effect, states will be evaluating the outcomes of decriminalization on programs, budgets, and systems alignment, and NASHP will continue to monitor these efforts and their outcomes.

Opioid Use Disorder Treatment: How Vermont Integrated its Community Treatment Standards into its State Prisons

May 3, 2021/in Policy Vermont Featured News Home, Reports Behavioral/Mental Health and SUD /by Eliza Mette and Jodi Manz

Federal and State Special Enrollment Periods Increase Access to Insurance Coverage

February 1, 2021/in Policy California, Colorado, Connecticut, District Of Columbia, Idaho, Maryland, Massachusetts, Minnesota, Nevada, New Jersey, New York, Pennsylvania, Rhode Island, Vermont, Washington Blogs, Featured News Home Eligibility and Enrollment, Health Coverage and Access, State Insurance Marketplaces /by Christina Cousart

With Federal Rule Issued, States Advance Prescription Drug Importation Programs

October 19, 2020/in Prescription Drug Pricing Colorado, Florida, Maine, New Hampshire, Vermont Blogs, Featured News Home Model Legislation, Newly-Enacted Laws, Prescription Drug Pricing, State Rx Legislative Action /by Jennifer Reck and Trish Riley

Earlier this month, the Health and Human Services (HHS) Secretary published the final rule for state importation of prescription drugs from Canada. To receive federal approval for their Section 804 importation programs (SIPs), the six states with laws enabling importation (VT, FL, ME, CO, NM, and NH) must meet the rule’s safety and cost-savings requirements and also navigate the rule’s implementation challenges.

While HHS made some of the states’ requested changes in the rule’s final version, such as giving states the flexibility to designate the agency responsible for administering a SIP, several concerns that states raised in their comments on the draft rule to ensure efficient and effective programs, were not reflected in the final rule.

Key among those concerns are issues relating to the role of the “foreign seller” (Canadian wholesaler) that purchases eligible prescription drugs from manufacturers in order to sell to the state “importer” in the United States. The final rule specifies that a SIP may work with just one foreign seller initially. Though the logic of the rule is to maintain a tight supply chain, limiting SIPs to just one foreign seller creates the risk that a manufacturer opposed to state importation may cut off its supplies to a single foreign seller that would be easily identified due to its increased demand for prescription drugs to supply a SIP.

Limiting SIPs to one foreign seller may also preempt normal forces of market competition that would otherwise help states maximize savings from importation.

Additionally, though the final rule gives states up to six months to identify a foreign seller after submitting their importation program applications to HHS, states may still be required to identify their foreign seller prior to federal approval of their SIPs. States had requested that the step of identifying a foreign seller come after program approval because foreign sellers may not choose to participate in a program that has not yet gained federal approval, especially when their participation may put them in a drug manufacturer’s crosshairs.

The final rule is scheduled to go into effect Nov. 30, 2020 – at which time a legal challenge from drug manufacturers is widely anticipated. Despite states’ request, the final rule did not include a severability clause – a provision that allows a law to stand even if a portion of the law is struck down by the courts. As a result, the federal framework for Canadian importation is vulnerable to being struck down if drug manufacturers successfully challenge even a minor provision of the rule.

Determined to achieve savings on prescription drugs for consumers despite the challenges presented by the final rule, states are continuing to do the groundwork necessary to design effective SIPs. For example, earlier this month, both Colorado and New Mexico convened stakeholder meetings in order to share information, solicit feedback, and answer questions. Four states – Vermont, Colorado, Maine, and Florida – had already submitted SIP applications for federal approval prior to publication of the final federal rule in order to meet timelines specified in their state statutes.

Florida issued an “Invitation to Negotiate” (ITN) to start the process of contracting with a vendor for a $30 million, three-year contract to manage its SIP. That contract was scheduled to be awarded in December 2020, however, Florida withdrew the ITN last week because no organizations responded to the ITN. While Florida sought a single contractor to fill multiple roles required to implement its SIP, Colorado, which is currently designing its own ITN for release in December, is taking an alternate approach by allowing diverse roles to be fill by multiple contractors as needed. The fact that Florida’s importation program is limited to public payers may have also made the contract less appealing to bidders from a market perspective, whereas Colorado’s program is directed at the commercial market. Florida also released its ITN prior to publication of the final federal rule, another consideration that may have inhibited potential respondents.

The National Academy for State Health Policy is continuing to work with states to advance their SIP plans and will provide updates about their progress.

States Seek Flexibility in Final Drug Importation Rules to Achieve Consumer Savings

September 21, 2020/in Prescription Drug Pricing Colorado, Florida, Maine, New Hampshire, New Mexico, Vermont Blogs, Featured News Home Newly-Enacted Laws, Prescription Drug Pricing, State Rx Legislative Action /by Jennifer Reck, Trish Riley and Johanna Butler

Six states with laws enabling the importation of prescription drugs from Canada – Vermont, Florida, Maine, Colorado, New Mexico, and New Hampshire – are awaiting publication of federal rules currently under review by the Office of Management and Budget.

They are eager to see if the final rules address key concerns submitted by the National Academy for State Health Policy (NASHP) in late March on the proposed rule, published in December 2019. In order to enable effective implementation of the program, states raised several concerns and requested changes, including:

Giving states the flexibility to determine the most appropriate state agency in which to house a state importation program (SIP);
Removal of the requirement that states must execute contracts with program partners prior to obtaining federal approval for a SIP; and
An extension of the initial SIP program terms beyond two years.

In order to capture the savings promised by importation of drugs from Canada – where prices on commonly used drugs can be up to 80 percent lower than in the United States – states are requesting changes to ensure those savings can be passed to consumers. State officials fear the savings could be “absorbed” by several proposed requirements that experts contend are not necessary to maintain program safety – but appear certain to eat into savings that states are hoping to pass on to consumers.

For example, states are requesting removal of the requirement that all sampling, testing, and relabeling of imported drugs occur within the confines of a foreign trade zone or port – a geographic restriction that could prove costly to states without providing any additional safety.

Other changes states requested include permitting drugs to be re-labeled and repackaged in Canada – a change that would also provide a welcome financial incentive for Canada to support importation given that it has otherwise expressed reluctance to do so. Finally, in order to ensure a competitive marketplace, states requested authority to contract with multiple foreign sellers rather than just one – the current limit in the proposed rule.

While Vermont, Colorado, Maine, and Florida have submitted applications for federal approval for their SIPs according to timelines laid out in their state’s statutes, only Florida has issued an “Invitation to Negotiate” to begin the process of contracting with a vendor for a $30 million, three-year contract to manage its SIP. That contract is scheduled to be awarded in December 2020.

Florida’s SIP program design contains some important differences compared to other states’ proposed importation programs. While most states have determined that savings for consumers are likely to be greatest in the commercial sector and have designed their SIPs accordingly, Florida chose to limit its initial SIP to only public payers, such as Medicaid and its Department of Corrections, which already receive significant discounts and don’t require significant, if any, out-of-pocket spending by individuals. Though Florida’s application includes estimated savings of $150 million from its SIP, it did not include details describing how those savings would translate into consumer savings, which is a requirement for federal approval alongside a demonstration of safety.

Because the Trump Administration has promised quick action on importation along with other drug pricing initiatives, it is widely expected that rules will be finalized before the December timeline reflected in the Federal Register. States are eager to see if the final rules will reflect the states’ much-needed changes critical to allowing states to safely import drugs from Canada while delivering on the promise of cost-savings to consumers.

NASHP Responds to Proposed, Landmark Federal Drug Importation Rule: Changes Needed

March 9, 2020/in Policy Colorado, Florida, Maine, Vermont Blogs, Featured News Home Administrative Actions, Model Legislation, Newly-Enacted Laws, Prescription Drug Pricing, State Rx Legislative Action /by Trish Riley

Seventeen years after Congress allowed federal importation and responding to laws enacted in several states to allow importation – the Trump Administration issued a proposed rule to implement the law. However, an analysis by the National Academy for State Health Policy (NASHP) finds that without certain revisions, the proposed rule would challenge states’ ability to implement and administer importation programs that ensure both safety and consumer savings.

Read NASHP’s recommended changes to the Administration’s proposed rule on the importation of prescription drugs here.

Section 804 of the US Federal Food, Drug, and Cosmetic Act, enacted in 2003, directs the secretary of the US Department of Health and Human Services (HHS) to issue regulations guiding the importation of certain prescription drugs from Canada. The HHS secretary must certify that importation poses no additional risk to the public’s health and safety and results in significant reduction in costs to American consumers. In December 2019, the Administration proposed regulations to implement this provision and recently HHS Secretary Alex Azar signaled an openness to include insulin as an importable drug, a move strongly supported by states.

The landmark rule establishes a pathway for state importation, but as proposed it imposes costly administrative burdens that would limit a state’s ability to import drugs at a time when effective action to lower drug prices is imperative. In the absence of federal action to curb drug prices, states have turned to importation as a means to lower costs. In developing their proposals, states recognize that the pharmaceutical industry is already a global one. An estimated 88 percent of active drug ingredients (APIs) sold in the United States and 63 percent of facilities making finished drugs sold domestically are located overseas. In 2018, over $70 billion worth of drug products were imported into the United States.

That global supply chain is already carefully regulated by the US Food and Drug Administration (FDA) and state importation programs, many of which used NASHP’s model importation law in their program design, are building on and mirroring those existing, federal safety requirements. According to the Kaiser Family Foundation, as many as 19 million Americans, frustrated by the high cost of prescription drugs, have imported a drug – sometimes through vehicles that evade current regulatory protections. States are proposing safe, wholesale importation of certain drugs, building on FDA’s current system, to provide a regulated channel for residents to access lower cost drugs to ensure FDA’s high safety standards are met.

The proposed rule clearly identifies the requirements for a state to propose a Section 804 Importation Program (SIP) for review and approval by the federal government. However, without certain revisions the proposed rule would impose administrative requirements that challenge a state’s capacity to establish and implement programs that ensure both safety and consumer savings.

Successful state implementation of importation requires certain revisions to the proposed rules, including:

States need the authority to determine which state agency will administer the program. The rule requires administration of the program by the state entity responsible for regulating pharmacies and wholesalers. Collaboration with those entities is necessary but those entities often lack the staff and capacity to administer an importation program, and such a requirement is inconsistent with most states’ Section 804 importation laws.
Requiring a state to have completed agreements with importers, foreign sellers, relabelers, and repackagers at the time of the state’s application to the federal government is unrealistic, given that those entities cannot enter into agreements until a program is authorized by the federal government. Instead, the federal government could conditionally approve SIPs, pending those agreements, and should provide technical assistance to states in developing them with Canada.
States need to contract with multiple foreign sellers in Canada to assure sufficient competition and supply of drugs under their programs. The proposed rule would initially limit states to one foreign seller.
Collaboration with Canada is a cornerstone of state importation plans and allowing drugs to be relabeled and repackaged in Canada would provide financial incentives for Canada to support the program, and would impose no additional public health and safety risks because the businesses that conduct relabeling and repackaging in Canada must already meet FDA standards.
Drug testing would be conducted in the United States even if repacking and relabeling are completed in Canada. In 2019, the FDA tested only 0.03 percent of all drug shipments imported into the United States. By law, these new drug importation programs will test and ensure the authenticity of 100 percent of drug shipments imported under these programs. But the rule’s restrictions on how that testing must be performed will raise costs without improving safety. The proposed rule, for example, requires all labs that test drugs to have an FDA inspection history, but does not provide information about how many currently do. The competency of drug testing labs could be ensured by requiring them to meet strict accreditation standards, and the FDA does not typically inspect independent labs. Under the proposed requirement, this rule could result in too few labs available to perform the necessary testing. As a result, states would be unable to implement their programs.
The proposed rule also limits state implementation capacity by mandating that all sampling, statutory testing, and relabeling of imported drugs occur within the confines of a foreign trade zone or port area. Under FDA’s current system for regulating drugs., these activities must meet FDA standards regardless of where they are conducted. This geographic limitation in the proposed rule poses a barrier to states’ implementation of their importation programs. There is no evidence that this limitation will ensure additional protection to public health and safety.
The proposed rule also relies on manufacturers to provide necessary disclosures and other important information. Manufacturers have historically expressed strong opposition to importation of their drugs and relying on them to provide critical information is expected to cause delays. The federal government should provide states with all necessary information in the event manufacturers resist timely compliance with these requirements.
The requirements for adverse event reporting and recalls as proposed by the proposed rule are redundant and costly. Current adverse event reporting and recall rules and procedures already protect consumers and should be followed.
The rule imposes various additional, unduly burdensome requirements. For example, the proposed rule requires the full suspension of a state’s importation program if any aspect of the state’s program does not meet an applicable standard. Instead, the rule should allow for corrective action plans in instances where noncompliance does not compromise consumer safety or protections. Further, the proposed rule includes a strict severability provision, which needs to be revised. In its current construction, the entire rule could be thrown out on a minor technicality.
By requiring the automatic termination of a SIP after two years, unless proactively extended by the FDA, the rule discourages investment and participation in a SIP.

Limiting the burden of pharmaceutical prices remains a priority that requires broader federal action. Until then, NASHP will work with states to continues addressing the issue and applauds the Administration’s effort to facilitate importation, but two hurdles remain.

First, without some modifications, the proposed rule creates costly barriers to state implementation that are unnecessary to ensure the safety of imported drugs and would increase state costs and reduce or even restrict states’ abilities to ensure savings to consumers.

More important, implementation of this initiative requires Canadian cooperation and the active engagement of the Trump administration to address any regulatory or legal barriers that Canada identifies that could impede the safe and cost-effective importation of certain drugs. Safe importation requires a partnership between the state and federal governments that has not yet been fully articulated.

Vermont CHIP Fact Sheet

December 5, 2019/in Policy Vermont /by NASHP Staff

Vermont Submits Concept Paper to Trump Administration to Import Drugs from Canada

December 3, 2019/in Policy Vermont Blogs, Featured News Home Administrative Actions, Cost, Payment, and Delivery Reform, Health System Costs, Legal Resources, Model Legislation, Newly-Enacted Laws, Prescription Drug Pricing, State Rx Legislative Action /by Trish Riley

Last week, Vermont Gov. Phil Scott submitted a concept paper to the federal government outlining the state’s approach to implementing the first-in-the-nation drug importation law. Earlier this year the Trump Administration announced that it would soon issue rules to allow the importation of drugs and those rules are presently being reviewed by the Office of Management and Budget.

Unlike an earlier submission from Florida that proposes a wholesale importation plan to benefit public programs, Vermont’s plan includes all commercial health plans and is designed to benefit all state residents, not just those on public programs.

Vermont’s approach is similar to those being developed in Colorado and Maine, which approved importation laws last year. Gov. Scott submitted his concept draft now in part to provide the Administration with another model to review as it finalizes its rules.

While the scope of the Florida and Vermont plans differs, there is significant similarity in their detailed approaches to addressing safety issues and implementing wholesale drug importation programs that would reduce the price tag of certain high-cost drugs for their states. Vermont proposes to assure consumer savings through a number of vehicles, including lowering premiums and deductibles, and reducing or eliminating copays on imported drugs.

View slides detailing Vermont’s presentation , and read Vermont’s Canadian Wholesale Importation Program for Prescription Drugs concept paper.

View slides detailing Vermont’s presentation.

View slides

Read Vermont’s Canadian Wholesale Importation Program for Prescription Drugs concept paper.

Read paper