New Analysis by HDA Finds Importation Proposals Are Too Expensive and Pose Health Risks to Patients


A report just released the HDA Research Foundation demonstrates that federal importation proposals to allow drug importation are devoid of practical implementation guidance and funding, so will fail to guarantee federal safety and quality standards for prescription medication. 

Using expert-panel interviews, literature reviews and quantitative data modeling, Risks and Realities of Commercial Drug Importation examines several points:

  • The set of importable drugs and countries with similar safety standards is very limited which limits the cost savings that can be achieved;
  • Adverse health event costs to patients due to substandard medication could climb as high as $1.4 billion annually and increase medicine-related adverse events by 5%; and
  • Those costs combined with regulatory and supply chain impacts could incur upwards of $2.9 billion in annual extra funding requirements for any commercial drug importation scheme administered at the federal level.

To date, no state that has passed importation has appropriated funding equal to even 1/50th of this estimate.

The report notes that the U.S. Food and Drug Administration would ultimately be tasked with the responsibility of inspecting and monitoring drug imports. The HDA report points out that “Quantitative analysis based on these estimates and published FDA budgets suggest that at least $270-350M annually would be required for the agency to handle these new responsibilities. This range aligns with estimates from interviewees with intimate knowledge of FDA processes.”

They also point out that these responsibilities would fall on an agency that is already “experiencing capacity constraints”, and that due to budget constraints, over 1,000 facilities already involved in the U.S. drug supply chain have yet to be inspected. The report suggests that FDA funding would need to be increased to meet their current responsibilities before it would be possible for the FDA to take on the added responsibility of managing a drug importation scheme.

The report concludes that the costs incurred bypassing current safety regulations will come at the expense of patients, and any importation proposal at the federal level that includes the required FDA oversight will be prohibitively expensive for U.S. taxpayers. This mirrors the experience PSM staff has had in recent years working with states that propose importation: They are excited to pass bills but not excited to talk about the risks, or costs, because logistically drug importation is more expensive and more dangerous than other cost reduction proposals.