American Journal of Law & Medicine

State regulation of Canadian pharmacies: a prescription to violate the Supremacy Clause.(Globalization of Pharmaceuticals: International Regulatory Issues)

I. INTRODUCTION

"This Constitution, and the Laws of the United States ... shall be the supreme Law of the Land; and the Judges in every State shall be bound thereby, any Thing in the Constitution or Laws of any State to the Contrary notwithstanding." (1)

Under the Supremacy Clause of the United States Constitution, federal law, such as the Federal Food Drug and Cosmetic Act ("FDCA") (2), is supposed to be the "supreme Law of the Land." The FDCA establishes a national closed domestic distribution system for approved prescription drugs in an effort to ensure drug integrity and safety. (3) In doing so, it purportedly sets the "gold standard" for prescription drugs regulation around the world. (4) Lately, though, this "gold standard" has been tarnished by personal importation, the practice of buying prescription drugs directly from foreign pharmacies--primarily Canadian--in conflict with the FDCA's restrictions on unapproved drugs and importation. (5)

States are pursuing programs and passing laws which are only exacerbating the problem. (6) Critically, the responsibility for our "gold standard" system is not solely that of the federal government--states are responsible for regulating and ensuring the integrity of the practice of pharmacy in their respective jurisdictions through their state boards of pharmacy (BOPs). (7) But some states are implementing initiatives, passing laws, and enacting regulations aimed at allowing foreign pharmacies to import prescription drugs into the United States in an effort to aid their citizens in obtaining less expensive prescription drugs. (8) Yet these activities come into direct conflict with the express terms and purposes of the FDCA. As a result, the FDCA these days seems to be followed by an asterisk which qualifies its supremacy as federal law. This qualification seems to be that the FDCA is supreme "unless Americans want to obtain cheaper prescription drugs from foreign pharmacies."

This article will summarize and explore the FDCA provisions most relevant to the prohibitions on the importation of prescription drugs and their underlying purposes. It will then turn to the states, starting with how states have traditionally regulated non-resident pharmacies. Then, it will move on to what the states are now doing at the legislative, regulatory, and executive levels to facilitate importation from foreign pharmacies, regardless of the restrictions contained in the FDCA. From there, this article will examine whether the states are violating the Supremacy Clause of the United States Constitution in pursuing initiatives to import drugs from Canada and elsewhere. Finally, the article will conclude with a discussion about how the states' promotion of foreign pharmacies may impact the practice of pharmacy and safety of patients if left unchecked.

II. FDCA CREATES THE "GOLD STANDARD" OF PRESCRIPTION DRUG REGULATION

A. FDCA PLACES STATUTORY RESTRICTIONS ON IMPORTATION OF PRESCRIPTION DRUGS

Under the FDCA, re-importation and importation (referred to jointly as "importation") of prescription drugs for a consumer's personal use is illegal. A prescription drug that is manufactured in the United States and then exported may not be reimported back into the U.S. by anyone other than the manufacturer of the drug. (9) In addition, prescription drugs made elsewhere for non-U.S, markets are not approved by the FDA, (10) properly labeled, (11) or dispensed with a valid prescription and, therefore, cannot be introduced into interstate commerce. (12) According to the FDA, "[i]n general, all drugs imported by individuals fall into one of these prohibited categories." (13)

The reason is that all prescription drugs are not created equal. (14) FDA drug approvals are specific in terms of several factors. (15) "Generally, drugs sold outside of the United States are not manufactured by a firm that has FDA approval for that drug. Moreover, even if the manufacturer has FDA approval for a drug, the version produced for foreign markets usually does not meet all the requirements of the United States approval, and thus is considered unapproved." (16)

Additionally, foreign drugs are not properly labeled making them misbranded under the FDCA. (17) For instance, drugs are misbranded if they fail to include all required information on the label (e.g. warnings, lot numbers). (18) They are also misbranded if they are made in a facility other than an FDA-approved facility (19) or if they are labeled in a foreign language. (20)

The legal short-coming of foreign versions of FDA-approved drugs was confirmed in the summer of 2005 by the United States District Court for the Northern District of Illinois. In U.S. v. Genendo et al., (21) the federal government sought to seize and to condemn a commercial shipment of Lipitor from Brazil and Zocor from Argentina. (22) Defendant Genendo purchased these drugs in South America and then shipped them to the United States to be repackaged and sold here. (23) The drugs were intended for foreign markets. (24)

One factor the court examined thoroughly was whether the drugs which were the subject of the lawsuit were FDA-approved drugs. (25) In particular, the federal government asserted that the imported drugs "each have the same chemical composition, as well as other similarities to the respective drugs Lipitor and Zocor, that are sold legally in the United States ... notwithstanding [that], the government argue[d] that the ... [imported drugs] are subject to condemnation as unapproved new drugs in violation of 21 U.S.C. [section] 335(a), and misbranded in violation of 21 U.S.C. [section] 352." (26) After a thorough analysis, described below, the court agreed. (27)

The court looked at the specifics of each drug approval by the FDA for the U.S. version. For instance, FDA-approved Lipitor, manufactured by Pfizer for distribution in the United States was approved for: manufacturing in Ireland or Puerto Rico at an FDA-approved facility, in 10mg/20mg dosages; packaging in Germany or Puerto Rico at an FDA-approved facility; a two year expiration date; and labeling and package inserts in English. (28) The FDA-approved Zocor, manufactured by Merck for distribution in the United States was approved for: manufacturing in Puerto Rico (40mg only) or the United Kingdom (80mg only) at an FDA-approved facility; packaging in Puerto Rico or North Carolina at an FDA approved facility; and labeling and package inserts in English. (29)

The drugs Genendo imported were made by the same manufacturers, (30) were not challenged as chemically different then those for the American market, (31) and, at least in the case of the imported Lipitor, were made at an FDA-approved manufacturing site. (32) But still the court found them to be unapproved foreign versions. (33) Although the imported Lipitor was manufactured in Ireland at an FDA approved facility, it was packaged in Brazil, where the FDA has no approved packaging facility. (34) Its expiration date was longer than two years and the labeling and packaging were in Portuguese. (35) None of these elements were part of the FDA approval of Lipitor for U.S. distribution.

As for the imported Zocor, it was manufactured and packaged in Argentina at facilities that were not FDA-approved. (36) Additionally, all of its labeling and packaging was in Spanish. (37) Consequently, neither drug complied with the requirements of the existing FDA-approved drug applications as described above, barring them from introduction into interstate commerce. (38) It is exactly for this reason that drugs intended for the Canadian market (39) and personally imported into the U.S. from Canadian pharmacies are almost always unapproved and illegal. (40)

B. THERE ARE NO FDCA EXCEPTIONS TO THESE STATUTORY REQUIREMENTS RESTRICTING IMPORTATION. (41)

Canadian pharmacies, (42) and others that support illegal importation, often claim that the FDA has created a "personal use exemption" from the FDCA statutory restrictions on importing prescription drugs when they are imported for a consumer's personal use. No such exemption exists. (43) These supporters have misconstrued an FDA guidance document entitled "Coverage of Personal Importations." (44) That FDA Guidance establishes a compassionate use policy to allow individuals with life-threatening diseases to bring into the U.S. a small quantity of drugs that are not available for purchase in the U.S. (45) The FDA Guidance is "not intended to allow importation of foreign versions of drugs that are approved in the U.S., particularly when the foreign versions of such drugs are being 'commercialized to U.S. citizens'. ... Moreover, the policy simply describes the ... enforcement priorities; it does not change the law." (46)

The FDA Guidance does not give consumers or businesses the right to import drugs for personal use. To the contrary, the Guidance provides that it is "not intended to create or confer any rights, privileges, or benefits on or for any private person." (47) According to the FDA, "the guidance document is not ... a license for individuals to import unapproved (and therefore illegal) drugs for personal use into the U.S., and even if all the factors noted in the guidance are present, the drugs remain illegal and FDA may decide that such drugs should be refused entry or seized." (48)

Far from legalizing drug importation for personal use, the FDA Guidance merely describes the agency's enforcement priorities. (49) The Guidance establishes strict criteria for reduced enforcement of the prohibition against personal drug imports. (50) The drug must not pose a serious health risk; the drug must not be FDA-approved; the drug must be intended to treat a condition for which domestic treatment is not available; the drug must not be commercially available in the U.S.; the drug must be for personal use; and the quantity must be limited to three months. (51)

Those that participate in the personal importation of prescription drugs do not satisfy these criteria. For example, Canadian pharmacies do not suggest that they only offer drugs that are unavailable to Americans. To the contrary, they promote drugs readily available in the United States, and simply offer them for less money. (52) The FDA specifically identifies commercial mail order importers as companies that are subject to enforcement actions for illegal drug imports. (53) The FDA Guidance states that "in view of the potential scale of such operations, FDA has focused its enforcement resources more on products that are shipped commercially, including small shipments solicited by mail-order promotions...." (54) The FDA has taken enforcement action against companies facilitating the mailing of drugs into the U.S. for individuals' personal use, (55) and has otherwise "made it clear that the [FDA guidance] is not intended to allow parallel or gray market imports of drugs that are legally available in the United States." (56) In other words, the FDCA does not provide a statutory personal use exemption from the laws against importing prescription drugs.

C. CONGRESS HAS POLICY REASONS FOR THE FDCA IMPORTATION RESTRICTIONS

The primary purpose of the FDCA is to "protect the public health." (57) According to the Supreme Court, the FDCA "touch[es] phases of the lives and health of people which, in the circumstances of modern industrialism, are largely beyond self-protection ...." (58)

The FDCA "limits the types of drugs that may be imported into the U.S.... [because] [the] current drug distribution system is relatively 'closed,' which helps ensure that the domestic drug supply is safe and effective." (59) The FDA's mission is to protect "the public health by assuring the safety, efficacy, and security of human and veterinary drugs ..." (60) and the agency relies on its statutory authority to do so. Congress gave the FDA the authority to limit the introduction of unapproved foreign-versions of FDA-approved drugs because of safety concerns arising from the infiltration of the U.S. market by substandard or counterfeit drugs. (61) Congress explicitly found that 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 ..." (62) These risks are real.

According to a blitz enforcement effort conducted jointly by the FDA and the U.S. Customs and Border Protection, many of the drugs seized coming into the U.S. by mail pose a genuine danger. (63) In particular, upon examination, federal officials learned that the drugs being personally imported included potentially recalled drugs, mislabeled drugs, "foreign versions" of FDA-approved drugs (with varying ingredients), drugs requiring careful dosing or physician monitoring, and drugs with dangerous interaction potential. (64)

Consequently, personal importation undermines the congressional purpose of the creation of the FDA and the enforcement of the FDCA. (65) During the past 70 years, the FDA has developed a system of rigid oversight over all steps of the manufacturing and distribution of prescription drugs, regulated at the state and federal level. (66) And as some have pointed out, "[i]mportation potentially opens that system to drugs that may have been manufactured in a country with fewer controls or lower standards or passed through a number of unregulated hands between the time they leave their original manufacturers and reach the U.S. patients." (67)

D. STATE LEGISLATURES AND BOARDS OF PHARMACY TRADITIONALLY HAVE SUPPORTED THE "GOLD STANDARD"

State boards of pharmacy (BOPs) are the state regulatory authority over the profession and practice of pharmacy. They are given this authority via state pharmacy practice acts passed by their respective legislatures. BOPs are supposed to set licensing requirements, record keeping requirements, inspection and enforcement guidelines, and are given the authority to investigate and rule on violations of the state's pharmacy practice act. (68) Indeed, a state's BOP often serves as the prime law enforcement authority for the state's pharmacy laws. (69)

As a general rule, the state BOP requires any pharmacy dispensing drugs to state residents to be licensed to do so. (70) This includes pharmacies operating in other jurisdictions that want to ship or mail in prescriptions. (71) For example, the State of Alabama requires non-resident pharmacies to maintain their license in the state in which they reside, in addition to registering with the Alabama BOP if they want to ship prescription drugs into Alabama. (72) Notably, the language in most jurisdictions is similar--to be registered or licensed in another state as a non-resident pharmacy, the pharmacy has to be licensed in the state in which it resides. (73)

By these express terms state pharmacy practice acts, in general, only permit licensing of non-resident domestic pharmacies. (74) Further, even in cases of more ambiguous practice acts under which certain state BOPs arguably may be able to license non-resident foreign pharmacies, very few of them have considered it. (75)

Indeed, the BOPs have remained hesitant "to provide legal recognition to an entity violating federal law...." (76) Further, the BOPs have not been sure how to effect any kind of enforcement action should a Canadian pharmacy be found to have violated professional standards. (77) As a result, most BOPs have not been using state law to legitimize foreign pharmacies that are shipping in foreign drugs in violation of federal law. In this way, BOPs have supported the purpose and provisions of the FDCA. …

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