A lot of Americans head to Canada for cheaper medication because U.S. prices are sky-high. While buying drugs from abroad can save money, it comes with some serious legal and health risks. While this strategy can save costs, it's crucial to partner with reputable vendors to avoid potential pitfalls.
It's no secret that Americans living near the Canadian border often drive up north and pick up their medications. Why, you ask? Because in the U.S., medications can be up to 2.7 times more expensive. This jaw-dropping price difference boils down to a couple of key factors, the biggest one being the lack of a single-payer system where one regulatory body evaluates and negotiates all drug prices. In contrast, the U.S. has a mix of private insurers and government programs, making negotiations more complicated and often more expensive.
This begs the question: why not join those savvy northerners and buy cheaper drugs from abroad as an organization? While this sounds like a fantastic idea, international specialty sourcing comes with its own set of risks, particularly in the legal space. To really benefit from this strategy, you need to be aware of these potential pitfalls, which is exactly what this post is for.
Consider this as your one-stop shop for all things related to international specialty sourcing where you will learn about the risks of this strategy and the approaches that could help you avoid them. By the end, you'll be ready to make informed decisions and save on high-cost medications!
Importing specialty drugs from abroad into the U.S. isn't as easy as it sounds, due to strict FDA regulations. This means that self-insured employers looking to source these drugs have limited ways of doing so– two, to be specific.
The first way involves contracting with a specialty vendor that works with U.S.-based pharmacies with international shipping abilities. Here the vendor handles both sourcing and shipping, delivering medications to patients at their U.S. pharmacy locations.
Alternatively, employers can contract specialty vendors to help employees travel abroad and pick up their medications themselves. This might involve arranging travel logistics and coordinating with international pharmacies to ensure that employees can get their specialty drugs while outside the U.S.
While the first strategy offers more convenience, the second option can lead to greater cost savings by avoiding the additional charges associated with the sourcing and shipping services provided by pharmacy intermediaries. What route you take does not matter; that ultimately depends on your specific objectives. What really matters is your choice of vendor because not all vendors comply with the strict U.S. regulations, resulting in legal and clinical issues causing you to gain more liabilities than savings.
So to make sure you avoid these pitfalls, pay close attention to the next few sections where we dive deeper into the risks of specialty sourcing and show you how to minimize them, so that you can make the most out of this strategy!
The legal aspect is definitely one of the biggest challenges faced by international specialty sourcing. Each country has its own set of rules for prescriptions, and they often aren't as strict as in the U.S. where drugs have to go through multiple safety tests before getting FDA approval. This difference in regulations can lead to problems like mislabeling and underreporting of side effects. The FDA even had to step in and warn some international vendors about shipping unapproved and misbranded drugs to the U.S.
To prevent these issues and ensure that all medications are safe, the Drug Supply Chain Security Act (DSCSA) was put in place, requiring all drugs to have specific identifiers for traceability. If a drug doesn't have these identifiers, it signals that it isn't up to U.S. standards, and the vendors supplying them can be traced and found in violation of the DSCSA. This can result in hefty fines for both vendors and plan sponsors.
This only goes to show how important it is to contract a reputable vendor, but more on that in the next section!
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The impact of international specialty sourcing on member satisfaction cannot be understated. Just imagine telling your employees that their specialty medication is no longer available a few blocks away but a few thousand miles away, in a different country. Noone would be happy about that. The hassle of traveling is a major inconvenience that might even discourage some from getting their medication, leading to serious health problems and higher costs down the road.
Moreover, you also have to consider the cost of travel itself. While personal travel for drug sourcing isn't recommended, if you choose to go down this route, your savings can be offset by high travel expenses, especially for employees located in more remote areas of the U.S where getting to an international pharmacy isn't as simple as a quick trip across the border. Same thing applies to mailing members’ medication. The farther it travels, the higher the costs you face!
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As we mentioned earlier, each country has its own set of rules for prescriptions, which can lead to some pretty tricky situations. It's not just about navigating the legal maze; it also raises serious healthcare concerns as dosages and side effects can vary significantly between countries.
Take, for instance, the case of Ozempic. In the U.S., this medication is typically prescribed at a dosage of 0.5 mg or 1 mg per week while in Canada, you'll find it available in a higher dosage option of 2 mg per week for certain indications. An unsuspecting U.S. patient who didn't check in with their provider could start taking a significantly higher dose, leading to unpleasant side effects like nausea, dehydration, or even pancreatitis.
Not to mention that the side effects from international meds can also vary because the same type of medication might have different active ingredients. For example, Cardizem in the U.S. contains diltiazem to treat high blood pressure and angina. But in Australia, a similar drug called Norvas uses amlodipine. Amlodipine can cause side effects like facial flushing, headaches, and ankle swelling. If patients don't check with their provider about the switch, their doctor won't know about the change, potentially leading to mismanagement of side effects and other serious health issues which, as we know, lead to serious costs.
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Sourcing drugs from abroad also involves the challenge of crossing international borders. This poses a major challenge to the delivery process, as medication has to go through customs which sometimes means getting flagged for additional paperwork or inspections, leading to delays.
Additionally, to make sure everything complies with U.S. regulations, these imported drugs go through extra quality assurance checks. This includes verifying that all documentation, labels, and packaging meet safety standards. While these checks are crucial for ensuring the medication's safety, they also add more time to the delivery process.
Since this involves multiple steps, even small delays at each stage can add up, creating a significant wait time for patients. This can be particularly worrying for those who depend on timely medication for managing their health conditions. A delay in receiving essential drugs could disrupt their treatment, potentially leading to serious health issues and costs.
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As we hinted at earlier, finding the right vendor is the key to success when it comes to international sourcing of specialty drugs. It's not just about finding someone who can deliver medications the cheapest; it’s about choosing a reputable vendor who excels in both clinical management and regulatory compliance. To help you make the right decision we put together a checklist of key things to look for when sourcing an international vendor.
While we spent most of the time addressing the challenges and risks of international specialty sourcing we don’t want you to think that it is not a good strategy. Quite the opposite!
International sourcing is a great tool for cutting costs but you have to navigate the potential pitfalls with careful planning and by partnering with a reputable vendor, who understands the importance of clinical management and regulatory compliance.
So if you want to give international sourcing a try go for it and don't forget to use our small list of tips for finding the right vendor. And if not, no worries! Check out some of our other articles on cost-saving strategies– they might be just what you're looking for.
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