Today’s new Supreme Court decision on foreign patent rights appears to makes it legal to import drugs that are FDA-approved from lower-priced markets into the US.
In Impression Products vs Lexmark, the Supreme Court just ruled that patent rights are exhausted when a patent holder sells a product abroad, meaning that they cannot stop the product from being imported into a third country by claiming it violates patent rights.
This is a MAJOR shift, that may have momentous consequences on the price of drugs in the US.
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The material accompanying this announcement has become so large that we now have a dedicated thread for the core information. That thread remains closed, so that we may be able to append to it as needed – this one, however, is open!
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The present thread represents the discussion thread for the core material listed above.
This could radically reshape the market in a way that could create a strain on Canada’s drug supply chain. I mean, presumably pharmacies there stock drugs based on estimates of how many people need them. Canada’s population is about 36 million, and we have about 300 million people. And presumably the drug cost is negotiated by the government with companies based on an estimate of how much will be purchased by the country… If Canada is all of a sudden importing enough drugs for 100 million people, 70 million of whom used to pay 4X more to the same pharmaceutical company, I would imagine that could change the ultimate price Canada can secure.
So I can see this being, in the short term, a huge boon for people strapped for cash or with expensive copays…then I can imagine Canada restricting purchases from non-citizens or residents.
Or possibly ( a pipe dream) the US may finally decide to negotiate drug prices on our behalf that are not 4X more expensive than the rest of the world.
I haven’t read the fine print but I think the ultimate effect might be forcing drug prices in the USA to become competitive to what they are in Canada more than it’ll actually result in people buying their drugs in Canada
yes I HOPE so! I imagine there will be an awkward growing pains stage though where people are making use of this new capability spontaneously, but the big players have not yet adjusted to the new reality and changed their pricing and marketing strategy.
@Michel It appears this decision prohibits the manufacturer from preventing the sale of their drugs from foreign countries into the U.S. But isn’t the holdup with the FDA?
What can a drug manufacturer do currently to stop sales of their FDA approved drugs from foreign countries?
Drug manufacturers can’t do anything to address the legality of drug importation, but rest assured that they will play hardball with their distributors that get caught doing this.
No. If the drug is FDA-approved, the FDA does not intervene. There is the issue of which manufacturing facilities are used, which I am not sure of yet.
In the past, when they were patented, they had the right to forbid their import. Now they can’t do that. I am not sure yet if there is another loophole they can exploit. For sure they can draw tight contracts with third-party resellers, forbidding out-of-country resale. But will they be enforceable in actual practice?
We are now starting to see some analysis coming out:
Thomas Cotter’s Analysis of the ruling: he is Briggs and Morgan Professor at the University of Minnesota Law School, and had filed an amicus brief requesting that SCOTUS affirm the Federal Circuit decision. He is unhappy with the decision.
This, btw, was filed as an Amicus Brief to the court prior to the decision, and supports the thought that gray market imports are a positive outcome:
Amicus Brief by Frederick Abbott supporting the SCOTUS decision, specifically mentioning the import of pharmaceutical products as a purpose: Frederick Abbott is Edward Ball Eminent Scholar and Professor of International Law at Florida State University College of Law.
