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2004-01-05 -- Access to Medicines: New Medicare law, Canadian Imports

  *  New Medicare drug coverage stalls state's discount plan

  *  States continue push for Canadian drugs


Thanks to Deborah Socolar, of the Health Reform Program at the Boston
University School of Public Health.


Portland (Maine) Press Herald, Saturday, January 3, 2004

New Medicare drug coverage stalls state's discount plan

http://www.pressherald.com/news/state/040103mainerx.shtml


By JOSIE HUANG, Portland Press Herald Writer

Copyright © 2004 Blethen Maine Newspapers Inc.

Medicare reform has inadvertently delayed a plan to provide discounted
medicine to thousands of Mainers who lack drug coverage but make too
much money to get traditional government assistance.

Maine Rx Plus, initially set to start Jan. 1 and help 275,000 Mainers,
is on indefinite hold as the state figures out how its program will
co-exist with the new Medicare prescription drug benefit. That
coverage, though limited, will be offered to senior citizens and some
disabled individuals for the first time in the federal program's
38-year history.

Officials in Gov. John Baldacci's administration say an array of
unforeseen scenarios have arisen, including this one: Someone who
joins Maine Rx Plus while earning less than 135 percent of the federal
poverty level - the state program accepts those living within 350
percent of poverty - could also qualify for a free $600 annual
Medicare subsidy for prescription drugs for the next two years.

One of the state's tasks is to identify the thousands of
"dual-eligibles" among Maine Rx Plus enrollees, then see how the state
and the individuals can benefit from federal funds.

"We want to make sure the person gets the $600 before we spend any
(state) money," said Trish Riley, the governor's director of health
policy and finance.

"It's an administrative negative," she said of the Medicare
complications. "But it's not all negatives."

Because the Medicare drug benefit was passed by Congress in late
November and information is only beginning to trickle out, Riley and
her staff have posed numerous questions to federal officials in
conference calls that have lasted as long as three hours: How great
will the Medicare benefit be? What drugs will it cover? How does this
compare to Maine Rx Plus? Will seniors have to carry multiple cards to
access discounts for different drugs?

With so many unknowns, Riley said it's unclear when Maine Rx will be
launched, though she predicted it will be "soon." Lawmakers are
pushing for quick action.

Senate Majority Leader Sharon Treat said she is eager to see Maine Rx
Plus operating because constituents have told her they are putting off
drug purchases until they can get Medicaid-like discounts from the
program.

"My hope is by the end of January it could be up and running," said
Treat, D-Farmingdale, who was briefed by Riley about Maine Rx Plus on
Friday afternoon.

The delay of Maine Rx Plus is just the latest hurdle for a program
that has undergone numerous changes and faces continuing legal
battles.

The program was born in 2000 as Maine Rx, and the state captured
national attention for threatening to punish drug companies that
refused to provide discounts for the program. The state planned to put
the products of uncooperative companies on a special list of drugs
requiring doctors to seek "prior authorization" before prescribing
them for Medicaid patients, a market that drug companies count on.

The trade group Pharmaceutical Research and Manufacturers of America
successfully stalled the initial program in court, arguing that Maine
was using the poor to extract discounts for better-off Mainers.

But the U.S. Supreme Court decided there was not enough reason to halt
the program. It lifted an injunction on May 19, 2003, and sent the law
back to U.S. District Court in Portland for review on its merits.
PhRMA has not sought another injunction, but on Wednesday it filed a
motion requesting that the court seek the opinion of the secretary of
the federal Department of Health and Human Services about the program,
according to Assistant Attorney General John Brautigam. No one from
PhRMA, whose offices were closed Friday, could be reached for comment.

The Baldacci administration has since renamed the program Maine Rx
Plus and softened features to protect it from future legal action. The
changes included eliminating open enrollment and adding the
income-eligibility cap.

In its first phase, the program will offer Medicaid-like discounts as
high as 60 percent off the retail price of generic drugs and 15
percent off brand-name drugs. This phase has upset the Maine Pharmacy
Association because it says Maine's pharmacies, which operate on a 1
percent to 2 percent profit margin, will have to swallow the cost of
providing the discounts.

The pharmaceutical industry has no problem with that part of the
program. But it continues to protest the state's plan to use prior
authorization to negotiate even deeper discounts for the second phase.

The state's enthusiasm for this controversial part of the plan,
however, appears to have cooled, even though that's what set it apart
from all other drug discount programs.

"I think we can do phase two . . . but I'm not sure we will," Riley
said Friday.

Staff Writer Josie Huang can be contacted at 791-6364 or at:

jhuang@pressherald.com


(Accompanying this article)

Today's Question:

Each day, we ask MaineToday.com readers for their reactions to events
in the news:

Maine Rx Plus Maine Rx Plus would offer some uninsured Mainers
discounts on some prescription drugs. Eligible Mainers will get
discounts on drugs that are on the preferred drug list that the state
is preparing for the Medicaid program. The program was supposed to
start at the beginning of the year. But the state has not been able to
get it started yet.

Question:

Can this plan really lower prescription drug costs or should it be
expanded?

Replies:

Expand it to cover more people and medicines: 80.43%

Implement the plan as is: 19.57%

Total Votes: 92

This poll is not a scientific survey of reader opinion. The results
are a snapshot of what readers are thinking.

See the results of past questions from the past seven days and find
out about how the poll works, check Previous Days' Questions.


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Usa Today,  Wednesday, December 31, 2003


States continue push for Canadian drugs


http://story.news.yahoo.com/news?tmpl=story&cid=676&ncid=676&e=5&u=/us
atoday/20031231/ts_usatoday/statescontinuepushforcanadiandrugs



By William M. Welch, USA TODAY

States leading the drive for legal purchases of lower-cost medicines
from Canada are not backing down despite threats by federal
regulators. One state health official accuses the Bush administration
of raising "bogus" safety concerns to protect drugmakers' profits.


More than a dozen states are moving ahead with various programs. Some
would direct their residents to approved drug sources in Canada. Some
states intend to buy the drugs for state workers and retirees or help
pharmacies purchase them.

The Food and Drug Administration (news - web sites) and the Health and
Human Services (news - web sites) Department have threatened lawsuits
and even criminal action to stop the states' plans.

The federal officials say importing any drugs from Canada, even those
manufactured at FDA-monitored plants for sale in this country or
handled by regulated Canadian pharmacies, would violate federal law
and risk exposing consumers to tainted or fake products.

"This is going to be an unenforceable law," says Kevin Concannon,
Iowa's director of human services. "The statements they make about
consumer safety or drug safety are the most bogus words I've seen
spoken from a government agency. ... There's more protection of
pharmaceutical manufacturers than there is of patients."

The hardening positions on both sides signal a looming legal and
political confrontation.

Governors in both parties want to lower their drug costs in a time of
budget austerity as well as aid people who lack drug insurance. The
Bush administration says any foreign purchases violate the law and
erode the FDA's authority, a position countered by overwhelming
support in opinion polls for cheaper drug imports.

"All that we are doing is enforcing the law as it is written," says
William Pierce, spokesman for Health and Human Services Secretary
Tommy Thompson.

"If Congress wants to give us the authority and resources to oversee
an import program, we'll do that," FDA Senior Associate Commissioner
William Hubbard says. There are moves in both houses of Congress to do
that.

No state has directly challenged the administration's interpretation
of the law yet, but state officials say federal regulators would have
to back down. "It would just create a firestorm," Concannon says.
"They would lose in the court of public opinion."

Iowa Gov. Tom Vilsack, a Democrat, hopes to begin a program next year
authorizing local pharmacists to buy drugs from Canada.

Officials in New Hampshire, Minnesota and Illinois are developing
programs to import cheaper drugs from Canada or to point consumers to
approved Canadian retailers.

The Bush administration's latest expression of opposition to imports
came in response to a request by Illinois Gov. Rod Blagojevich, a
Democrat, who formally sought approval of a test program. Federal
officials say the request is certain to be rejected.

A growing number of cities and states have voiced interest in Canadian
drug purchases. Of the four states furthest along in their planning,
two are headed by Republican governors who find themselves at odds
with the Republican administration:

. New Hampshire Gov. Craig Benson "is committed to finding solutions
to the prescription drug problems through reimportation of Canadian
drugs," spokesman Wendell Packard says.

The state plans to have a Web site to help residents buy Canadian
drugs next month.

. Minnesota Gov. Tim Pawlenty plans to establish a Web site by January
steering state residents to Canadian retailers approved by Minnesota
inspectors. "We believe the Web site is totally legal," says Jason
Rohloff, Pawlenty's director of federal affairs.


Even advocates of legalizing imports don't see buying drugs in Canada
as a long-term solution to high drug prices in the USA but as a way to
pressure manufacturers to lower prices. Democrats also see it as a way
to pressure Republicans in Congress and the White House on drug costs
and to make the point that the new Medicare law does little to address
drug prices.

Many governments, including Canadian provinces, negotiate prices with
drugmakers. The United States does not, and the new
Republican-sponsored Medicare law prohibits the federal government
from negotiating drug prices. Concannon, the Iowa health official,
calls that provision "appalling" in light of high prices charged to
consumers who lack drug insurance and must pay retail prices or go
without medicine.