FDA Issues Proposed Rule on Importation of Prescription Drugs From Canada

The Food and Drug Administration is proposing new regulations that would allow importation of prescription drugs from Canada. Under the proposal, FDA would approve “Section 804 Importation Programs” (SIPs) sponsored by a state, tribal or territorial governmental entity. The registered wholesaler or pharmacy identified by the SIP as the importer could then import the specified drug from an FDA-registered, Health Canada-licensed wholesaler that buys the drug directly from its manufacturer. The proposed rule is set for publication in the Dec. 23 Federal Register, and comments are due March 9.

FDA is concurrently publishing a guidance document that would outline procedures for drug manufacturers to import FDA-approved drugs originally authorized for sale in a foreign market. The proposed rule and guidance document form a two-pronged approach announced by FDA in July that aims to make prescription drugs cheaper (see 1907310018).

SIPs Must Reduce Cost, Pose No Additional Safety Risks

The proposed rule says FDA may approve a SIP if the sponsor’s application demonstrates that its proposed importation would pose no additional risk to public health and safety, and that it would “result in a significant reduction of cost to the American consumer.” Even if it meets these requirements, FDA may still reject the application “in its discretion,” for example if it has safety concerns, thinks the SIP won’t result in significant enough cost savings, or wants to limit the number of SIPs in light of resource demands. Approval of a SIP would last for two years, at which point the SIP may be extended for additional two-year periods.

Eligible drugs. Drugs imported under a SIP would have to be approved by Health Canada to be eligible, and meet the conditions of an FDA-approved new drug application (NDA) or abbreviated new drug application (ANDA). “Essentially, eligible prescription drugs are those that could be sold legally on either the Canadian market or the American market with appropriate labeling,” FDA said.

Wholesaler or pharmacy may co-sponsor. While the sponsor must be a non-federal governmental entity, a pharmacist, wholesaler or another governmental entity would be able to co-sponsor the plan. “Co-sponsorship could introduce valuable flexibility (for example, multiple States could co-sponsor a plan with a large wholesaler) and allow SIPs to benefit from the experience of pharmacists and wholesalers, while preserving the advantages that accrue from sponsorship by at least one State or other governmental entity,” FDA said.

Supply Chain for Each Drug Must Have One Manufacturer, Seller and Importer

The SIP proposal would have to identify the foreign seller in Canada that will purchase the eligible prescription drug directly from its manufacturer, and the importer in the U.S. that will buy the drug directly from the foreign seller. The supply chain for each drug under a SIP would be limited to three entities, i.e. one manufacturer, one foreign seller and one importer, FDA said. The initial proposal would have to be limited to a single foreign seller and a single importer, though additional sellers and importers could be added to an SIP after the program begins and FDA is satisfied with its compliance with statutory and regulatory requirements.

No transshipment through Canada. If an eligible drug is manufactured outside of Canada, it would need to be exported commercially into Canada by the manufacturer and labeled for the Canadian market. “It could not be transshipped through Canada for sale in another country because this could create opportunities for counterfeiting or other forms of fraud,” FDA said.

Sale directly to seller. Eligible prescription drugs would have to be sold directly by the manufacturer to the foreign seller in Canada. “FDA has determined that this requirement is critical because FDA would generally not possess information needed to trace drug products labeled for the Canadian market back to the original manufacturer,” it said. Drugs imported under a SIP would be subject to the Drug Supply Chain Security Act.

Special Labeling Requirements for Canadian Seller, U.S. Importer

Under the proposed rule, the foreign seller would have to ensure that “a section 804 serial identifier (SSI), which is an alphanumeric serial number unique to each package or homogeneous case, is affixed or imprinted to each package and homogenous case of the drugs,” FDA said. The importer would have to ensure that the product identifier is affixed or imprinted to each package or homogenous case of the drugs. That identifier would have to include a product identifier that includes a National Drug Code, unique alphanumeric serial number of up to 20 characters, lot number, and expiration date, in both human- and machine-readable format. “The importer would also have to maintain records linking the product identifier affixed or imprinted on a package or homogenous case to the SSI that the foreign seller assigned,” FDA said.

Additional Labeling, Testing Requirements for Importers

The importer would also have other responsibilities, “including screening eligible prescription drugs for evidence regarding whether or not they are adulterated, counterfeit, damaged, tampered with, or expired; arranging for each shipment of eligible prescription drugs to be tested by a qualifying laboratory; and arranging for them to be relabeled with the FDA-approved labeling, including the carton and container labels, prescribing information, and any patient labeling, such as medication guides, instruction for use documents, and patient package inserts. The Importer is also responsible for facilitating the affixation or imprinting of a product identifier at the same time that the eligible prescription drugs are relabeled with the FDA-approved labeling.”

Pre-Import Request Required 30 Days Before Entry at FDA-Specified Port

At least 30 days prior to “the scheduled date of arrival or entry for consumption of a shipment containing an eligible prescription drug covered by the SIP, whichever is earlier,” the importer would have to submit a pre-import request to FDA. Entry would be limited to only the CBP port of entry authorized by FDA.

Formal entry required. Under the proposed rule, the importer, or authorized customs broker, would be required to electronically file a formal entry for consumption in ACE “for each eligible prescription drug imported or offered for import into the United States,” FDA said.

Testing and relabeling performed post-entry or in FTZ. The importer may admit the drug into an FTZ to conduct required testing and labeling, or can make an entry for consumption and request to recondition the drug. The drug would have to be relabeled and the testing accepted by FDA before the drug could be distributed in the U.S.

Draft Guidance Details Procedures for Registration, Labeling of Drugs for Sale in Foreign Markets

Meanwhile, FDA’s draft guidance outlines procedures drug manufacturers should follow to import versions of their drugs that were originally intended for sale in a foreign market. It includes information on how to obtain an additional National Drug Code for FDA-approved drugs marketed in foreign countries, which “would allow greater flexibility for drug companies to offer these products at a lower price than what their current distribution contracts require.” It would also set labeling requirements, including unique identifiers and statements on product labeling to allow pharmacists to “accurately identify, dispense and bill for these products,” FDA said in a press release. The draft guidance also includes information on proposed requirements for supplements to new drug and biologics applications. Comments on the draft guidance are due Feb. 21, FDA said in a notice.