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Executive Summary

CLOZARIL IMPORTATION BY STATE MEDICAID AGENCY is blocked by requirements that the agency obtain the product for testing under an approved IND, FDA Federal-State Relations Division Director Heinz Wilms indicated Nov. 14. Responding to a query by Virginia Medicaid Director Bruce Kozlowski, Wilms suggested that the state might import Sandoz' antischizophrenic agent (clozapine) for use in a clinical investigation if it can get a protocol approved by FDA. Under this approach, the state presumably would design a protocol that includes Medicaid beneficiaries as test subjects. The only other option would be to purchase the product from overseas in the identical dosage form, packaging and labeling specified in Sandoz' approved NDA for the product distributed in the U.S. In a Sept. 28 letter to FDA, Kozlowski asked for the agency's position on a Virginia Medicaid proposal to import Clozaril to avoid the costs of the proprietary patient blood monitoring services associated with domestic purchase of the Sandoz product. The state proposed to reimburse costs of patients who import personal quantities of clozapine in three-month supplies from Europe, where it is available without the Clozaril Patient Management System (CPMS). Wilms replied that "unless the imported clozapine is covered by the approved NDA or by an IND, there is no legal means by which any party, individual or organization can engage in the importation from abroad of clozapine." He added that "any attempt to import a version of clozapine that is not covered by an NDA or IND would likely be met by an enforcement action by our field organization." Regarding the state's import proposal, FDA is "to say the least, very troubled -- notwithstanding your intentions to accomplish the type of careful monitoring of your clients that the letter and spirit of the current approved labeling seeks to accomplish." FDA also cautioned that importation "would not be permitted under the Personal Importation Policy, [which] applies only to drugs that are not commercially available" in the U.S. and is provided for patients with life-threatening illnesses. Nonetheless, FDA expressed sympathy for the Medicaid agency's situation. "We fully understand and appreciate your dedication and that of your department to meeting the needs of the citizens of the commonwealth for whom clozapine may provide important benefits -- as well as doing so in a cost-efficient manner." Furthermore, "FDA is fully aware of the difficulties that Sandoz' CPMS poses to governmental groups such as your own." In Massachusetts, John Hancock Insurance, the primary insurer for state government employees, has said it will not cover the antischizophrenic agent unless Sandoz breaks out the cost of the drug ingredient from the associated cost of CPMS. Massachusetts is one of at least two states -- Michigan is another -- that has been analyzing whether the Clozaril/CPMS package has possible antitrust implications as a restriction on distribution of an FDA-approved prescription drug product. In addition, Sandoz' CPMS has prompted a lawsuit by Pennsylvania mental health groups, which want to force their state's Medicaid program to cover Clozaril for all beneficiaries who need it. Because of the product's expense, the state provides the drug only to patients who have failed at least two other therapies and who have been selected by lottery for treatment. In September, a Kansas federal court ruled that Clozaril must be provided to patients whose conditions are resistant to other therapies. The court also ordered that the drug be included on the state's Medicaid formulary. However, the recently-enacted federal Medicaid drug law, effective Jan. 1, provides that Clozaril may be excluded from coverage.

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