Letter to President Barack Obama

April 8, 2009

President Barack Obama
1600 Pennsylvania Avenue, NW
Washington, DC 20500

Dear Mr. President,

On behalf of the Partnership for Safe Medicines (PSM), a group of organizations and individuals that have policies, procedures, or programs to protect consumers from counterfeit or contraband medicines and dedicated to the safety of the drug supply, I would like to congratulate you on your efforts to improve health care and expand meaningful coverage for the millions of Americans who lack it. However, PSM is deeply concerned that the most vulnerable run the highest risk of encountering counterfeit, adulterated, or unsafe medicines and believe a comprehensive approach is needed to solve this patient safety problem.

We believe that safety must be our top national priority in any health reform effort. However, with respect to prescription drugs, today Americans unknowingly risk death or serious injury to their health by taking counterfeit drugs. Counterfeit drugs impact virtually every country in the world (including 115 in 2008) and virtually every disease state. Indeed, in 2008, there were at least 651 different types of counterfeit branded, generic and over-the-counter drugs discovered. Over the last several years, with improved appearance and packaging, these criminals have made their fake goods even harder to detect.¹ This is clearly a growing global problem and requires many new types of international collaboration for effective investigation and interdiction.

Issue: Importation
In addition, this drug safety issue also has particular relevance to the debate on prescription drug importation into the U.S., one of several proposed cost-saving measures under consideration by Congress. I applaud your administration’s choice to study the issue before proceeding and would ask that any analysis focus upon several areas, including:

1. Lack of Regulation for Products Trans-Shipped Through "Safe" Countries such as Canada and U.K. Drug importation advocates believe that drugs purchased from countries such as Canada and the UK are safe because of their strict health regulations. Unfortunately, this is simply not true. For example, Health Canada clearly states drugs not earmarked for Canadians are not subject to the Canadian government's safety regulations. Hence, drug exporters can bypass Canada's safety regulations and mail fake or low-quality drugs made in high risk countries such as China and India to Americans without Health Canada’s oversight. Likewise, the UK indicates it lacks the power to stop suspected counterfeits on its shores destined for the U.S. because these goods are only transiting through the country. Indeed, recent conflicting E.U. rulings have resulted in U.K. customs now not stopping nor inspecting goods transiting through, allowing counterfeit medicines to move through the U.K. and into the U.S. undetected.

2. Inability for Importation to Satisfy US Demand and Foreign Provider and Citizen Resistance. There are simply not enough legitimate drugs in foreign supply chains to satisfy U.S. demand. For example, if just half of elderly Americans shifted their purchases to Canadian sources, it would exhaust the entire Canadian drug supply in a few months. Hence, both Canadian providers and citizens oppose U.S. importation. In addition, this reality could have considerable impact for our political and economic relationships with smaller countries like New Zealand, Czech Republic, Romania and others, whose supply could be devastated by parallel traders exporting most of their supply to the U.S.

3. Inaccurate Safety Perceptions for Foreign Risky Purchases. A drug importation policy will give Americans an inaccurate—indeed, dangerous—perception that buying drugs from any "Canadian pharmacy" is safe because "the government is allowing drug imports." This is particularly true for patients buying drugs through high-risk Internet drug sellers.

4. US Policy in Hands of Foreign Governments. Congressional importation proposals would place our drug policy in the hands of foreign governments. Price, quality, oversight (or lack thereof), and other critical issues will be defined by other governments without concern for U.S. patient protection and with unclear potential for safety regulation or enforcement. It would also reduce security of the supply chain to the weakest global link. The U.S. would effectively rely on the Asian, Baltic, and Balkan region countries to serve as our “border patrol” against counterfeit drugs. However, these countries do not have sufficient knowledge or capacity to do so and will prioritize the needs of their own citizens with the scarce regulatory resources they have.

5. Virtually No Cost Savings. The Congressional Budget Office estimates in its 2004 drug importation issue brief that reduction in drug prices from importation would be "small" or "only about 1% … [and] permitting importation only from Canada would produce a negligible reduction in [drug spending." Any savings would be virtually nonexistent because middlemen will reap all the profits and leave little, if any, savings for consumers. The reality is that prescription drugs from a safe, secure drug supply chain—regardless of whether or not it allows drug importation—will always be more expensive that those from an unsecured, potentially fraudulent supply chain.

Proposed Policy
Considering these risks, we urge you to educate Congress about the need to guarantee the safety of prescription drugs. This affects all of us, but our most vulnerable patient populations, such as minorities, seniors and fixed income patients would bear the brunt of any policy failure. Instead, we need to focus on creating substantive programs that maintain access to safe medicines by using the closely regulated and inspected U.S. supply chain. This could include:

1. Offshore FDA Support and Authority. The FDA needs funding and authority to develop programs and systems that tighten the drug supply chain. In order to stop counterfeit drugs and other unsafe products from pouring out of foreign manufacturing facilities and into the U.S., the FDA needs to establish more foreign field offices and staff them with both inspectors and criminal investigators armed with the same authority as their State-side colleagues. This includes the authority to enter and inspect foreign manufacturing facilities without previous notice.

2. Onshore FDA/Agency Support and Authority. The U.S. currently has 300 custom ports of entry, but the FDA only has 200 port inspectors and only 17 inspectors to cover all international mail centers. We must hire more inspectors here and grant the FDA and other agencies the authority to destroy unapproved and counterfeit drugs entering the US rather than returning them to the criminals who sent them here—our current policy.

3. Illicit Internet Drug Seller Regulation. The Internet is a key vulnerability in the safety of the US supply chain. The Department of Health and Human Services should be given power to substantively regulate online sellers, and federal legislation should be considered to develop a national Internet drug seller accreditation program using banking laws to limit suspect transactions for illicit drug sales.

We believe that action by your administration to fight counterfeit drugs would be recognized worldwide. African nations and others have been leading the fight in the World Health Organization to elevate the prominence of this issue, and a strong signal of support from the U.S. would boost their efforts and our relations with them. Taking action to bolster the FDA’s authority and fighting Internet-based drug pushers could be regarded as a best practice worldwide and provide valuable guidance to countries looking to the U.S. for leadership.

We are ready to assist in developing legislation to achieve these policy objectives or to serve as a resource to you on issues relating to safe medicines. We again applaud your efforts to fix the major health care reform gaps and to proceed thoughtfully with regard to drug safety. If we can be of assistance to you, we hope that you will not hesitate to call on us.  Marv Shepherd, the President of our Board, can be reached at (512) 471-5607 or shepherd.marv@safemedicines.org.   

With very best regards,

Marv Shepherd, PhD     
President, Partnership for Safe Medicines
Director of Pharmacoeconomics
University of Texas School of Pharmacy

Bryan A. Liang, MD, PhD, JD
Vice President, Partnership for Safe Medicines
Executive Director, Institute of Health Law Studies, California Western School of Law
Co-Director, San Diego Center for Patient Safety, University of California, San Diego School of Medicine

Thomas T. Kubic
Treasurer, Partnership for Safe Medicines
President & CEO, Pharmaceutical Security Institute
Deputy Assistant Director, FBI (Ret.)

¹ Data derived from the Pharmaceutical Security Institute (PSI); a PSM member organization.