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Shalala kills Rx reimport law, but Bush Administration could overrule
Less than a month before the Bush Administration was set to take the reins of government, outgoing Health & Human Services secretary Donna Shalala declined to implement the recently enacted drug reimportation law. "Flaws and loopholes contained in the reimportation provision make it impossible for me to demonstrate that it is safe and cost effective," Shalala wrote to President Clinton late last month. At a news conference, Clinton defended Shalala's decision and noted that he had called the measure "deeply flawed" when he signed it just before Election Day.
Under the law, the secretary of HHS must certify that allowing pharmacists and wholesalers to reimport U.S.-made prescription drugs would pose no additional risk to public health and safety and would result in significant savings to U.S. patients. Shalala's decision could be overturned by her successor. President-elect George W. Bush tapped Wisconsin Gov. Tommy Thompson for the job, but Thompson said he would not discuss the matter until his Senate confirmation hearings this month. During the battle for the White House, Bush endorsed the reimportation concept. It was strongly opposed by the Pharmaceutical Research & Manufacturers of America, representing an industry whose members were among Bush's most ardent and generous backers.
The National Community Pharmacists Association dismissed the secretary's actions as "insignificant" even in the short term. "Shalala echoed bogus criticisms of the new law made by a few left-wing House Democrats," said John M. Rector, NCPA general counsel and senior v.p. in a memo to legislative committee members. "In particular, she mistakenly claimed that they had insufficient authority to provide importers the necessary labeling and mistakenly claimed that the new law does not prohibit drugmakers from forcing importers and others to raise the price on foreign Food & Drug Administration-approved prescription drugs." The American Pharmaceutical Association said in a statement that it "acknowledges" Shalala's opinion that the law "should not be implemented as good public policy."
In addition to PhRMA, the National Wholesale Druggists' Association (now the Healthcare Distribution Management Association) also strongly opposed the measure. The Clinton Administration leaned against it until it passed the Senate by 74 to 21. NCPA was the only pharmacy group to openly support it and work for its passage.
Shalala shared the view of some Democrats who felt the law was an election year fig leaf providing low-cost political cover for Republicans. "I know you share my view that an importation billno matter how well craftedcannot be a substitute for a voluntary prescription drug benefit provided through the Medicare program," she said. Clinton said he would propose some strengthening language to Congress before leaving office. Several of the bill's supporters expressed dismay over Shalala's decision. Sen. Byron Dorgan (D, N.D.) called it "wrongheaded" and said "it lets the drug industry off the hook." Sen. James Jeffords (R, Vt.) said he would propose a legislative remedy if the Bush Administration did not reverse the decision. But original cosponsor Sanders said the secretary made the right move. He said the final law was far from his version and "riddled with loopholes that the drugmakers were certain to exploit."
Mike Conlan. HHS chief kills Rx reimport law, but decision could be overturned.