Senate Votes to Allow Drug Reimportation From Canada

WASHINGTON – The Senate voted Friday to allow U.S. pharmacists to buy prescription drugs (search) in Canada, where the same medicines sell for less, and resell them here, another attempt to drive down the rising cost of drugs.

The 62-28 vote attached the measure to the pending Medicare (search) prescription drug bill moving through Congress, where approval in the House and Senate was expected by the end of next week.

Lawmakers, especially those living in states bordering Canada, have been pressing for the change for years, spurred in particular by senior citizens in their states who board buses to cross the border and buy cheaper drugs.

But the provision includes a measure that could prevent it from ever becoming law: It requires the secretary of health and human services to certify that the reimportation can be done safely. Congress passed a similar law once before, but former HHS Secretary Donna Shalala would not certify that it could be done without risk to patients. Her successor, Tommy Thompson (search), said the same.

That didn't stop the Senate from acting. Sen. Byron Dorgan, D-N.D., successfully argued that Canada's safety controls were just as reliable as those in the United States and U.S. consumers have nothing to fear from drugs bought from Canadian pharmacists.

"If you believe it's unfair that we pay the highest prices in the world for prescription drugs, then vote for my amendment," Dorgan said.

Opponents argued that it poses a particular danger in today's age of bioterror threats.

"It opens a new door, a new opportunity, and it is a new threat to the security of the people of this country," said Sen. Thad Cochran, R-Miss.

The vote followed approval a day earlier of another strategy to drive down prices, overwhelmingly endorsing a plan to bring generic medicines to the market more quickly, 94-1.

"This is a very good day for consumers," Sen. Charles Schumer, D-N.Y., said after the generic drug provision was added Thursday.

The generic drug provision essentially codifies regulations issued by the Food and Drug Administration last week to make it more difficult for brand-name companies to block generic competition.

The provision also is designed to penalize generic drug companies if they enter deals in which brand-name competitors pay them to delay bringing the lower-cost alternative to market.

Off the Senate floor, a block of conservatives was lobbying to boost support for private companies. They see private insurance as the future of Medicare in delivering both drugs and routine health care.

Fearful that seniors would stay away from new managed care options being created by the bill, they want to pay private companies more, hoping the benefits would be good enough to attract a significant number of the elderly. They also released a letter to President Bush from 27 Republican senators asking him to help them make their case to GOP congressional leaders.

In the House, the second of two committees approved its version of a Medicare bill, defeating a series of Democratic amendments aimed at sweetening the benefits and reshaping the program. Approval by the House Energy and Commerce Committee, on a near party-line 29-20 vote, sent the bill to the House floor for debate next week.

On Friday, Senators also planned to consider an amendment by Sens. Blanche Lincoln, D-Ark., and Kent Conrad, D-N.D., that would direct the government to offer a prescription drug plan for at least two years in areas where private companies show little interest. It's needed, they said, to add stability to the program.

"Our seniors could be forced in and out of plans, whipsawed from one plan to another, year after year," Conrad said.

The $400 billion, 10-year Medicare plan would, for the first time, give all seniors federal subsidies to buy prescription drugs, relying principally on private companies to deliver the benefit. It also would create a new Medicare managed care option -- preferred provider organizations -- which supporters hope would give seniors more choice while saving the government money.

At issue, though, is how much money the government will have to pay PPOs to attract seniors. The Congressional Budget Office estimated that, as written, the bill would attract just 2 percent of seniors into PPOs, though other estimates put it higher.

At a stormy closed-door meeting Thursday, Republicans led by Sen. Jon Kyl of Arizona demanded more money for PPOs. They want payments to be based on competitive bidding by the insurance companies, not on the normal price of caring for a Medicare enrollee.

Some Democrats expressed concern, though, raising the prospect that a major change could undermine the bipartisan backing the bill enjoys.

Senate Majority Leader Bill Frist, R-Tenn., said he was well aware of the tension and was trying to walk a careful line. "I'm going to do my best not to let it be an extreme bill to the left or to the right," he said.

Frist had $12 billion not yet allocated to help solve this problem and one other: how to keep employers from dropping coverage for their retirees once the Medicare benefit kicks in.

The controversy set off a series of daylong meetings involving key lawmakers and Thompson, officials said. At day's end, Frist said he hoped for a compromise that would give Kyl and conservatives their way, but only after a delay of four or five years.