On January 5, 2024, the US Food and Drug Administration (FDA) approved Florida’s proposal to import prescription drugs from Canada. This is the first approval of a Section 804 Importation Program (SIP) by the FDA. Whether Florida is able to import drugs from Canada, including in light of Canadian regulations controlling drug exports, remains to be seen.

Section 804 Importation Programs

On October 1, 2020, the FDA published a rule entitled Importation of Prescription Drugs (the US Importation Rule) to implement Section 804 of the Food, Drug, and Cosmetic Act. The stated purpose of the US Importation Rule is “to achieve a significant reduction in the cost of covered products to the American consumer while posing no additional risk to the public’s health and safety.”

  • Under the US Importation Rule, “States and Indian Tribes, and in certain future circumstances pharmacists and wholesalers, may submit importation program proposals to the [FDA] for review and authorization.” 
  • Eligible drugs must: (i) be approved by Health Canada; and (ii) meet FDA-approval conditions for a drug currently marketed in the US (aside from US labeling). Biologics, controlled substances, and certain other drugs are not eligible for importation.
  • A SIP proposal must, among other requirements, identify a licenced wholesaler in Canada that will purchase the eligible drug directly from its manufacturer.

Florida’s SIP proposal approved

Florida first submitted its SIP proposal on November 23, 2020, followed by several amendments. On January 5, 2024, the FDA issued a letter to Florida and a news release advising that the proposal was approved. The approval is time-limited, lasting two years from the date the FDA is notified of the first shipment of imported drugs.

Before Florida can import and distribute Canadian drugs, it must first:

  • submit a Pre-Import Request to the FDA for each eligible prescription drug to be imported;
  • ensure that the drugs have been tested for, among other things, authenticity and compliance with FDA specifications and standards; and
  • relabel the drugs with FDA-approved labels.

In a news release, Florida stated that it “will begin by providing prescription drugs in a small number of drug classes which will include maintenance medications to help individuals who have chronic health conditions such as HIV/AIDS, mental illness, prostate cancer, and urea cycle disorder.” The initial recipients of imported drugs will be under state care, including the Department of Corrections, but the program will be expanded to include Medicaid members.

Canadian regulation of drug exports

Although the SIP approval is just a first step before Florida can import drugs from Canada, manufacturers and wholesalers should be aware that Canada’s Food and Drug Regulations contain provisions meant to prevent drug exports from causing or exacerbating drug shortages in Canada (the export regulations).  

The export regulations apply to:

  • Drug Establishment Licence (DEL) holders, which generally include drug manufacturers, distributors, and wholesalers (see here).
  • Prescription drugs, biologics, controlled substances, and certain other drugs (FDR section C.01.014.8).  According to the Export Guide, the regulations pertain to drugs intended for the Canadian market, namely, those having a drug identification number and a Canadian label.  

The export regulations prohibit a DEL holder from “distribut[ing] a drug for consumption or use outside Canada unless the licensee has reasonable grounds to believe that the distribution will not cause or exacerbate a shortage of the drug” (FDR section C.01.014.13).  If the DEL holder does export a drug, it must “create a detailed record of the information that they relied on” to determine that the export would not cause or exacerbate a drug shortage (FDR section C.01.014.14(1)). Health Canada’s Export Guide provides factors to consider when assessing whether export will create a drug shortage risk.