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This week the court ruled in favor of Gilead Sciences Federal authorities say illegally importing medicines from abroad could have a major impact on America’s burgeoning health care program.
A CNBC investigation last year found that these programs, called Alternative Funding Programs (AFP), are becoming more popular across the country as drug prices soar. However, US authorities claim that AFP is importing medicines from international markets in violation of Food and Drug Administration regulations.
A U.S. Court of Appeals on Thursday upheld a preliminary injunction filed by Gilead against several AFP and related companies. Patient advocates say the decision could force AFP to significantly downsize or even go out of business.
AFP defends its operations as legal and safe and says its business is an antidote to high prescription drug prices.
In December 2024, Gilead sued several companies in connection with the illegal importation of its HIV treatment Biktarvy. The lawsuit was filed after a patient in Maryland received the drug in the mail from Turkey with label instructions in Turkish.
The lawsuit targeted AFP and several affiliated companies called Rx Valet. Gilead also sued Mertain Health, which manages employee health plans and is part of Aetna, a CVS Health company, and Pro-Act, a pharmacy benefits management company.
“Meritain has long maintained a policy of not supporting programs for non-FDA-approved drugs sourced from outside the United States and not contracting with companies that facilitate the importation of non-FDA-approved drugs sourced from outside the United States,” Aetna spokesman Phil Brand said in a statement. “Despite this policy, Melittain has been named as a defendant in a lawsuit brought by Gilead regarding international pharmaceutical procurement. Melittain strongly disputes this allegation and is vigorously defending the charges.”
Rx Valet did not respond to a request for comment from CNBC.
AFP typically claims that medicines it imports from abroad are the same as those sold in the United States.
The court disagreed this week, finding that the differences between Gilead’s U.S. drugs and the foreign drugs imported by the defendants are “substantive, not theoretical” and that the defendants circumvented Gilead’s supply chain by importing the drugs through unauthorized overseas channels.
“Although the products Gilead sells in Turkey and the products it sells in Maryland share the same chemical formula, they are vastly different and undergo different quality control systems,” the ruling said.
A Gilead spokesperson said in a statement that the ruling will help protect patients by removing drugs from the U.S. supply chain that are not subject to FDA oversight or quality protections.
Shabir Inbar Safdar, executive director of the Partnership for Safe Medicines, a coalition of nonprofit and pharmaceutical industry groups, said the court’s ruling makes clear that “you cannot import an untraceable drug with a foreign language label, give it to U.S. patients and then call it equivalent to an FDA-approved drug.”
