>> i think it's medicare and medicaid that have the obligation to be@@@@@ @ @ @ rying to quantify this is not easy, but just to briefly share with my colleagues is how much fraud is out there. 1990s, the fbi estimated 10% of all health spending was lost to fraud and abuse. that is an fbi conclusion. the national health care

anti-fraud association estimates that 3% of all health standings is lost to fraud. whether it's 8% or 10%, it's a significant amount. some suggest fraud and abuse is only a problem in the public sector. senators sar bain -- senator sanders, i think, answered that clearly. how well these programs are managed is very important. i authentic your analogy to use the suggestion where fraud and abuse is occurring is misplaced. department of labor is a key enforcement agent. as of may 2009, a month ago, they initiated 768 and 207 criminal investigations obtaining monetary penalties of more than $205 million. they currently have 73 civil and 60 criminal investigations that are ongoing. criminal activities often organized crime operations result in employers and individuals losing millions.

organized crime is not employees of medicare or medicaid, it's the people taking advantage of the system and scamming it at the disadvantage of people who count on these programs. the criminal division to the extent i'm aware -- there may be exceptions of this and if there are, it's important for us to know it, are investigating employees of the department of health and human services or the medicare program itself. i suspect most of these cases are focusing on nongovernmental employees, the people abusing the process is where the bulk of it is. my friend from arizona here and i proms we'd reached a point here, john, and i will stop here. >> mr. chairman, i don't want to interrupt the flow here, but i do want to respond to senator enzi's arguments, if we can do that. >> can i say to my colleague, i apologize. i'm in the middle of the mark-up of the defense authorization bill down below and i want to apologize to all members, but we

are trying to wrap this up, obviously today, as the chairman is trying to wrap it up. i appreciate your indulgence and thank you. i thank the chairman for your courtesy. this is a simple amendment. it's one issue that's been banging around for years. no matter what happens today, we will win sooner or later because it's in the interest of the american people. if the amendment could be handed out, i would appreciate it. >> i assume this is the one -- >> mccain number iv. >> it is on direct importation? >> yes. one of my favorites. >> normally when this comes up we either have senator cochran or roberts who deals with the safety section which i assume you do not have in that amendment. >> this amendment requires the secretary of health and human services to verify the safety and importance of prescription drugs. i don't know what more you want in it.

if we could get the amendment out maybe it could clarify it for you. >> appreciate it. >> obviously, i don't know of any senator who would propose an amendment that would allow unsafe or prescription drugs into this country that did not meet all the safety standards. so, mr. chairman, the amendment would provide americans access to safe and imported prescription dugs at much lower price. it would lower the overall price of this legislation due to the significant savings it would provide americans and the government. the amendment would, one, waive the food and drug administration administration's limitation on the importation of prescription drugs from outside the united states. require the secretary of health and human services to verify the safety of imported prescription drugs, prohibit manufacturers from engaging actions to restrict, prohibit or delay the

importation of a qualifying prescription drug, and four, set forth provisions governing the purchase of prescription drugs from an internet website. they've been found, imported prescription drugs have been found to be 55% less expensive than those sold in the u.s. at a local pharmacy. the congressional budget office has estimated american consumers could save up to $50 billion over the next decade. if they were able to buy imported drugs. according to in april 2008 poll by kaiser public opinion, over half all americans say they take prescription medicine daily. there is no better stimulus for the 50% of all americans who take prescription drugs daily and for the millions more americans who are prescribed medicine when diagnosed with an illness. now we are going to hear -- and by the way, i wish that my colleague and friend senator dorgan were here. he is far, far better at this

than i am. he has different bottles of pills and describes the different costs if you bought them in canada or the united states. he does a really great job. i've seen the act about 30 or 40 times and i always enjoy seeing it again because he does such a great job. i think it's lipitor that he carries around, two different bottles, but anyway, so i don't pretend to do as persuasive a job as my friend senator dorgan of north dakota. we are going to hear arguments from the pharmaceutical industry on why the amendment shouldn't pass. most powerful lobby today is pharma. they exercise their muscle with great frequency. they contribute millions of dollars to campaign coffers. i understand the opposition here. you are going to hear the

industry. we had an intercepted e-mail the other day when we were going to try to get it on the floor. the arguments were we needed to contact various people in order to stop this. they'll argue they are not safe. they'll argue fda doesn't have the resources to ensure the safety of imported drugs, but let's be clear. the almighty pharmaceutical industry's real concern is competition. any claim that imported drugs will be dangerous is inaccurate. safety of imported drugs is of utmost concern and this would require drug wholesalers to register with the fda and institute strict safety requirements including manufacturing site inspections. additionally the amendment requires chain of custody rules to ensure only authorized persons handle any medications. the amendment would provide the fda the resources and authority

it needs to ensure the safety of imported drugs and to stop illicit sales. mr. chairman, i don't know whether this amendment will pass on this bill, particularly since we, i think it may have some additional urgency given the fact we are trying to find ways of paying for the universal health care or making health care affordable and available to all americans. i have watched the pharmaceutical industry and pharma and their powerful lobby block it in the past. they may be able to do so again, but i've been around these kinds of issues where we've taken on the special interests for a lot of times over the years. we will. we will do what's right in the long run. pain not in this committee. maybe not on this bill. at some point in time because it benefits the american consumer, it benefits 50% of the american people that have to take prescription drugs every day and it's to their benefit and sooner

or later they will prevail. with that, mr. chairman, i know we'll go through the same argument and discussion and obviously, i would request a recorded vote on the amendment, but i also wouldn't want to take too much time from the committee because we have pretty well ventilated this issue a number of times in the past. >> mr. chairman, mr. chairman? >> senator mccain, this is the same amendment offered as the mccain-dorgan-snow language? >> i think the senator from north dakota would prefer to call it dorgan. >> i apologize but that is the same amendment. i know the issue has been raised by senator enzi. that is the question of whether or not, whether it was the cochran or roberts language -- is it part of this bill or not? i don't know the answer to that? >> according to senator mccain's staff, it is not in here. they put safety provisions in

there. they always mention that. i have gotten a copy of the cochran-roberts language which places some requirements for safety certification before the bill can go into effect, which is what we've always passed when this bill has come up. at some point they figure that with that amendment in there, it's a worthless bill. but i would ask unanimous consent to be able to offer this second degree amendment to the mccain amendment. >> mr. chairman, it's fine with me. let's have no doubt who wrote that, pharma and no doubt about the effect of it. it will kill the bill. you can vote for it, but it kills the ability to re-import drugs. let's not have the charade.

i would be glad to do whatever the committee's wishes are. have no doubt it would have the effect of killing the legislation and the amendment before us. >> mr. chairman? >> let me finish the thought. i supported this proposal in the past. 108th congress we had this matter up. i think the case has been made on re-importation. >> sorry? >> is this on? >> just pull the mike closer. >> i supported this in the past. 108th congress we had a vote on this and i supported it. i would again today. i think this is an important provision moving in that direction. obviously, members here -- i also, i disagree with john at this point. i don't think the cochran or language necessarily kills the bill at all. it does raise the issue many of us have concern about the effectiveness, but nonetheless, i want to be on record as being supportive of this effort. i know there's been an effort in the past to talk about this and

different vehicles and so forth, but this is certainly a major cost factor in dealing with health care. i'll leave my colleagues to express their views on the matter. that's where this senator stands on the issue. senator brown. >> thank you, mr. chairman. i support mccain amendment and oppose any second degree amendment. i've been through this as john as 1 1/2 decades working with john on these and patent issues, too, that pharma seems to, even when we went to battle they seem to win the war. any weakening language does two things. one, it denies these cost savings to consumers and second, it's got something about public safety as john points out. it denies savings to consumers and only doesn't save us the money it would save if we were to do this right. for years, several years when what is in the house of representatives, i represented a district in northern ohio about four hours from windsor,

ontario. i used to take bus loads of ohio consumers, mostly elderly, but not all, to canada to buy drugs. it was a peculiar thing for a federal official in one country to take people to another country to buy prescription drugs, the same prescription drugs they could have bought in a local drug store, same brand names, same box even, the same -- this exact same drug, same inert or active ingredients. the price was 1/3 or 1/4. that's the only difference. that's not because of their single-payer health care system but the government did what the ba does this this country, negotiate drug prices on behalf of 38 million consumers and directly negotiate the drug prices on behalf of them with the drug industry and got price savings of 50, 60, 70, 80%. the mccain approach is the right

approach in cost savings that are so important will be contributed to this bill if we pass the mccain language without the weakening language. i would add those same kinds of cost savings we can see in the biologics section of the bill later. when we do a generic, we know how generic drugs have cut the costs of chemical pharmaceuticals. we also know the same process and biologics will save some $10 billion over ten years plus, way more than that. that is a good score. senator gregg is always concerned about the score keeping the costs down. this is one element of doing that. senator mccain's language, not to be weakened by the cochran pharma language as senator mccain suggested, and coupled with what we can do in biologics and other things.

i think it will bring prices down for consumers, hospitals and private payers and tax payers. >&$,gb i am going to make a request of the -- where did he go? it's a little hard to make a request of him if he is not here. >> senator mccain left me a note asking me to manage the amendments because he has to go back to armed services.

>> my request is for him to defer this to the coverage section. it is coverage. it could be voted on there. i suspect it won't change a single vote, but that would allow us to put in an amendment without changing the precedent for the committee for second degree amendments. i suspect it will get the same result at that time that it would right now. i would just ask for that courtesy, partly because i have no way to know what the proxies would be on my committee for either the, what would be a second degree amendment or the mccain amendment. i'm not prepared for that. >> why don't we do that. why don't we have -- senator mccain's staff is here. no? oh, there you are. >> they would object and i would object. we vote on this. >> mr. chairman -- >> let me hear from other members, as well. >> mr. chairman, i would ask senator brown to hold on this to do it under the coverage section

of senator enzi. this clearly impacts everybody. i have sympathy making sure all our constituents get the best possible price on drugs, but i also have a concern and we had a lot of news in the past couple of years about things that have been imported into this country that had tremendous health impacts. we have a system, an fda, i know senator mclusky and i worked on many times to make sure we get through drugs quickly, but at the end of the day we have a process where safety and efficasy is critical. when our constituents go in a grocery store and buy off the shelves, they need to know it's a gold standard there. i haven't had a chance to look at the mccain amendment. we had this debate before. i want to take everybody's word that is the same language, but i have real concerns about it and i would ask senator brown, this has been dropped on us like a

huge two-inch bill here. if we could hold this until the coverage debate, i would really appreciate it. >> i'm trying to explain is senator mccain is in the mark-up on the armed services bill downstairs, i believe, wherever that is occurring so is running back and forth. what he asked is for senator brown to manage this discussion for the amendment. >> i would say to senator brown, if we are going to vote on it right now, i will vote no because i have not had time to read it. it could have a huge impact on the public. >> i, too, am a strong advocate of consumer opportunity, but i have to be in up here for consumer protection. what i'm going to put on here is not my health hat, but

appropriator of health care. we have risks of counterfeit drugs coming into this country. we know this from sources and the mcmafia around the world exploiting us. this is real. i really have to insist on a certification from the secretary of hhs on safety. i can only do it as a matter of really good conscience. i want our consumers to get the best deal. i would love for them to be able to import inexpensive prices. everything i know from both classified and unclassified briefings, i really would have some enormous amount offing anxiety as voting for this amendment as constructed. >> senator roberts? >> i would like to echo the remarks from the distinguished senator from maryland.

i was chairman when she was most helpful on the committee when this first came up. i don't think we are leaking anything classified here when we say we did have hot spot hearings and basically with focus on the united states and this is an area where i share her concern. her concern is very real. so i think -- i didn't realize and i apologize to the senator, i didn't know she had an amendment in order. that is another thing, mr. chairman, i thought we were going to do this next week under the coverage section of the bill. >> it's not her amendment. >> the mccain amendment. >> i know it's the mccain amendment, but i had an amendment to the mccain amendment or the modification, but it wasn't filed. his is, mine's not. i thought the deadline for

coverage of the bill was next week. last week the deadline came and went. some of us were confused about that in regard to the process. the modification that i had, and i'll read it, it's very quick. i think some others have shown the same concern. we are talking about drugs coming in from estonia, romania, bulgaria, et cetera, et cetera, and you move to the mideast and it gets shaky. we had that one case and you'll remember it, i think, senator mikulski that, bottle or prescription bottle that came in from iraq, of all places. so i think it is a very real threat. my modification since i have missed the deadline on the amendments, but again i thought we were going to do this under the coverage section and my deadline on the amendment on that would be next week.

it simply says this act shall become effective only if the secretary certifies to the congress that the implementation of this act will oppose no additional risk to the public's health and safety and result in a significant reduction in the cost of covered products to the american consumer. it's that section a that is absolutely essential if i'm going to support this amendment, although i know exactly what the senator from arizona is trying to do. i respect that. i don't mean to throw a clinker in here or be a johnny-come-lately, but i did want to share the concern of the senator from maryland. i would like to ask the chairman some guidance here. i know senator mccain is busy in the armed services committee. i understand that. i thought this was going to be next week. i was going to offer an amendment prior to the deadline for next week, which i think i understand is next week. and that that would be an order. i'm also more than happy to let

senator from maryland take the lead or distinguished senator from washington or whoever else would like to do this. i need some guidance here. >> my guidance would be, as i thought of my job here is to count noses. as i count noses at this point, i would say senator mccain is not here, that my view is the mccain amendment if offered without the roberts-cochran, whoever else is offering the language on the safety and effectiveness will fail. i happen to be in support of the mccain amendment. i am also in support with the amendment to do with the safety and effectiveness issue. i would tell people as i look around my job is to get some sense of where my colleagues are in these matters. right now if john is interested in adopting this amendment, he's going to be better suited in accepting the amendment or having a vote that deals with

these other issues, otherwise it will not make it. my advice would be, i want to offer amendments or not offer them is wait until title one of the bill. allow the amendment to be offered then the amendment carries. that's my judgment on the matter. obviously members have a right to offer amendments when they want to. if it were offered at this point, that is the conclusion. >> mr. chairman, senator mccain wants to go ahead with the vote. i think he snows sometimes we tilt at windmills here. he knows sometimes you lose. he also knows that as i do that the so-called safety language is language that really does restrict re-importation. we've all seen this. >> that's right. >> you've seen the drug industry every year. every time there is a spike we have the re-importation language and the drug industry comes in with their amendments and they

usually win because they are darn good at this and we don't get anywhere on it. i hear members cite a united nations roll call raising fears in people that we are going to start importing drugs from places with no strong safety net, safety regimen like fda has. that's not what's going to happen with this. we have worked on this language for years. the mccain amendment, understands that and embodies that. gives the secretary the power to figure out the authority to figure out where the safe drugs come from. there's a lot we need to do on food safety. there is a lot we need to do on a lot of things. the fact is that i have confidence that when i take my constituent, i took my constituents ten years ago to windsor, ontario and went to hunters drug store and they bought lipitor and other prescription drugs in the same boxes with the same brand name, same dosage, same inert ingredients and the active

ingredients that the candidate equivalent of the fda protects the government in canada. those fears aren't real. the drug industry will probably have its way on this vote. i hope senator mccain tries it again in the next section. he wants to go ahead on the amendment. i ask for a roll call. >> senator brown, really, i take offense at what you are implying here about those of us who worry about safety. you know my affection for you. >> i know and it's mutual. >> we tend to be on the same side 99% of the time, but this counterfeit drug thing is a real thing. i'm grad you went to canada and bought drugs if we could all go to canada and go to their drug stores, it would be a different gig. this is not what importation is. importation will come through a variety of trade routes for which there will be inspection and there is a lot of counterfeiting. if you want to vote on it and

think it's so, don't imply those who are voting for safety are showing for the drug companies. >> let me echo that point, as well. it's always a dangerous ground when we get into attributing motivation why people cast votes. i do support the mccain amendment, but i don't believe people necessarily worry about safety and efficasy are cools of the drug industry. >> i apologize if that's what people thought my comments indicated. >> senator sanders? >> i don't often agree with senator mccain, but i think he is absolutely right on this issue and concur with what senator brown just said. i live an hour away from the canadian border in northern vermont. i think i was the first member of congress to take people over the border. i will never forget as long is a live. we were with a bus load of women and dealing with breast cancer, and they did not have a lot of money. they purchased tomaxafin.

they paid 10% of the price. with tears in their eyes, working-class women struggling for their lives didn't have enough money to buy medicine and paid 1/10 of the price about an hour away from where they were living. if we as a nation think we can eat fruits and vegetables that come from developing countries, that come from farms in mexico and in china, the idea we cannot properly import medicine from canada, from the united kingdom, in major developed countries with the help of the fda, that you can't have a paper trail to make sure these products are safe is inentrepreneursible to me. of course we can do it. i've been involved in the struggle for 15 years. i think this is one way -- i am

not a great exponent to free trade. senator mccain is. if you can import food from all over the world. if you can import all kinds of products, why in god's name can you not import prescription drugs under very heavy regulation from the fda whose job will be to say any product that comes into this country has to pass the highest safety rations? of course we can do it. if we do it, we can lower the cost of prescription drugs for the government and millions of people. i strongly support this amendment. i hope we can pass it now. i think, mr. chairman, you can correct me if i'm wrong, but majority leader reid indicated this amendment would come through the floor of the senate. remember a couple of weeks ago it was taken out? i think we have another shot of it on the floor. i hope we can pass it today. thank you. >> without thee