Alternative Funding Programs for Prescription Drugs Are Putting Patient Lives at Risk

By: Ranier Simons, ADAP Blog Guest Contributor

As part of ADAP Advocacy’s continued spotlight on the dangers of counterfeit prescription drugs, it is worthwhile to elevate a recent expose aired by CBNC. Two weeks ago, CBNC aired an investigative deep dive into the predatory practices of some alternative funding programs (AFPs) that illegally import medications to sell to insurance plans and patients. The expose was entitled, "How Soaring U.S. Drug Prices Fueled What Feds Call An Illegal Import Of Medications." The 30-minute documentary effectively presents how patients are pawns sandwiched between the law and entities that knowingly break it for profit. AFPs are putting patient lives in danger.

Photo Source: Alliance for Patient Access

It is worth noting that U.S. drug prices are not soaring, despite the claim in the documentary's title. According to the Drug Channels Institute, inflation-adjusted U.S. brand-name drug prices fell for the seventh consecutive year. In its annual examination of drug prices and trends, Drug Channels Institute’s President, Dr. Adam Fein, summarized, “For 2024, average brand-name drugs’ list prices grew by only 2.3%. What’s more, after adjusting for overall inflation, brand-name drug net prices dropped for an unprecedented seventh consecutive year.” The real issue is the overall unaffordability of healthcare services and the push to control costs.

Alternative funding programs are companies that promise employers and patients access to prescription medications at a low cost. Typically, AFPs operate by exploiting patients to utilize manufacturer drug assistance programs to obtain medications (NASTAD, n.d.). In the case of the CBNC expose, the AFPs subject to investigation are providing prescription drugs through illegal importation. In the documentary, Lori Mayall, who oversees anti-counterfeiting and product security at Gilead Sciences, states, “Every time you are taking a foreign medicine that has been delivered from overseas, you’re playing a game of Russian roulette.”

AFPs target vulnerable populations. The typical client of AFPs is small private employers, city and county governments, school districts, and unions. These entities have limited budgets and are thus desperate to find ways to save money. The documentary highlighted that the AFPs who promise the most outrageous bargains on prescription drugs are the ones who illegally import. Employers carve out coverage for high-cost prescription drugs and require patients they cover to use AFPs to obtain the medications. While some patients are aware that the medications they are receiving are sourced outside the United States, many are not. In most cases, the employers are aware, but they are not educated on the real dangers of importing the medications in terms of drug safety. Moreover, they are not educated about the illegality of importation.

CNBC's Melissa Lee candidly interviewed representatives from several AFPs. Overall, they all painted themselves as being altruistic by providing a public service to people. They described their actions as saving employers money while giving patients access to expensive medications they would otherwise not be able to obtain. The representatives complained that prescription drugs are much cheaper overseas, thus Americans should have access to those lower prices. They feel they are enabling Americans to exercise their rights.

AFPs incorrectly argue that their importation activities are legal under FDA guidelines. However, Leigh Verbois, the former director of the Office of Drug Security Integrity and Response at the FDA, stated on camera, “What AFPs are doing is importing misbranded and unapproved foreign drugs, which is illegal.” AFPs claim they are legal and operate under the FDA’s personal importation policy. Verbois noted this is incorrect. She explains that the importation policy is particular and limited: “If a drug is not approved or available clinically in the United States, an individual can obtain a product from a foreign source, assert they are importing that product for themselves, and then bring that product under a limited supply of 90 days into the United States.”

Photo Source: KFF News

This is not how AFPs operate. AFPs buy drugs that are approved and commercially available in the United States from foreign entities at lower prices, then distribute them to U.S. patients. Notwithstanding the illegality of the operation, AFPs are not honest in their sourcing. They claim to source only medications from reputable tier-one sources such as the United Kingdom, Canada, and Australia. However, the investigation revealed that drugs are actually also coming from places such as India, Turkey, Germany, and New Zealand. 

The foreign entities distributing these medications are not licensed to practice pharmacy anywhere in the U.S., and almost all have no assets or staff here. Should they make a mistake and harm a patient, there is no way to hold them responsible. Should they decide to cut corners and dispense subtherapeutic or counterfeit medication, they cannot have their license suspended, be brought into court in the U.S., or be forced to compensate the patients they harmed.  The medicines they dispense are not part of the U.S. track-and-trace system, so there isn’t even a way to authenticate them. Sometimes, they also break the law in their own country by exporting critical medicines meant for domestic patients.  These are not legitimate healthcare providers that patients should depend on for their lives.

Most importantly, many AFPs do not purchase foreign medications and instead distribute them to patients. In some cases, foreign suppliers and pharmacies ship medications directly to patients. This enables the drug shipments to avoid law enforcement and customs and enter the country under the radar. Thus, it makes it almost impossible to tell how many drugs are entering the country illegally.

This was part of the way Gilead Sciences was alerted, and it subsequently filed a lawsuit to prohibit the importation of foreign versions of its medications sold in the United States. A patient whose prescription drug plan was serviced by an AFP was sent a bottle of the HIV antiviral Biktarvy from Turkey, complete with labelling written in Turkish. The investigation found that, according to the Office of the U.S. Trade Representative, Turkey is one of the world’s largest suppliers of counterfeit medications. The operators of AFPs not only fail to effectively screen their sourcing but also lack the means to do so. Mayall also stated, “You don’t know how that product was stored, handled, or distributed.” She added, "and it travels through an illegal supply chain that’s easily infiltrated with counterfeits.”

Unfortunately, patients subject to utilizing AFPs who engage in foreign importation have no choice. Their employers tell them that if they do not use the AFP, they will have to pay the list price out of pocket for the medications they need. The patients who are uncomfortable with and aware of the foreign sourcing of their medications must risk their lives just to obtain their medications.

Photo Source: Partnership for Safe Medicines

Unfortunately, bad actors continue to flourish. Shabbir Safdar, Executive Director of The Partnership for Safe Medicines, revealed in the documentary that his organization discovered over $5 million in illegally imported medicines over a two-year period. CNBC’s Lee even explained that the U.S. House Appropriations Committee is so concerned about illegal drug importation that it asked the FDA to produce a comprehensive report on how to strengthen oversight. No matter how inexpensive, any drug is expensive when the price of taking it is the risk to one’s health. Continuing to raise awareness of the pervasiveness of AFPs, educating patients and employers about the dangers of obtaining foreign medications, and encouraging policy oversight are among the most effective ways to protect patients' well-being so they are not treated as pawns for profit.

[1] Fein, Ph.D, Adam. (2025, January 7). Inflation-Adjusted U.S. Brand-Name Drug Prices Fell for the Seventh Consecutive Year as a New Era of Drug Pricing Dawns. Drug Channels Institute. https://www.drugchannels.net/2025/01/inflation-adjusted-us-brand-name-drug.html

[2] NASTAD. (n.d.). Alternative Funding Programs. Retrieved from https://nastad.org/sites/default/files/2025-07/resource-afp-issue-brief-2025.pdf

Disclaimer: Guest blogs do not necessarily reflect the views of the ADAP Advocacy Association, but rather they provide a neutral platform whereby the author serves to promote open, honest discussion about public health-related issues and updates.