By Jason Peterson, RPh, Director, Clinical Strategy & Monica Gindhart, Vice President Of Business Development
For years, international sourcing—where medications are obtained from pharmacies outside the U.S., typically through personal importation programs—has been part of pharmacy strategy. Some employers have used these programs to manage high-cost medications, but they haven’t always been consistently understood or applied. That’s changing.
What was once a niche cost-containment tactic is now being used more deliberately by employers facing sustained pressure from specialty drug spend. At the same time, scrutiny is increasing. Manufacturers are filing lawsuits against sourcing programs. Courts are weighing in. And regulators are drawing clearer lines between structured importation programs and employer-driven sourcing models.
The result is a shift. International sourcing is no longer just about savings. As adoption increases and scrutiny follows, the structure of the sourcing program itself is what determines whether it is sustainable or creates new legal, regulatory, and fiduciary risk.
International Drug Sourcing Lawsuits and Regulatory Trends Employers Should Know
In late 2024, Gilead, a manufacturer of HIV medications, sued a program tied to an employer health plan. The company claimed that imported versions of its drugs were being distributed in a way that used its trademarked name and branding without permission. A federal court temporarily stopped that program—but only for medications manufactured by Gilead—while the case moves through the appeals process. Other personal importation programs remain in place for different medications. Shortly after, Novartis and Genentech filed a similar lawsuit involving another sourcing model.
As more employers adopt international sourcing to manage high-cost medications, manufacturers are responding, both to protect revenue and maintain control over how their products are distributed. Instead of relying only on regulators, they’re going to court.
At the same time, the FDA is taking a measured approach, continuing to advance structured importation pathways for states and tribes under Section 804. While those programs are distinct from the personal importation models often used in employer-sponsored sourcing strategies, they reinforce a broader point: international sourcing itself is not being eliminated. What is changing is how these programs are evaluated by regulators, manufacturers, and plan sponsors alike.
Programs built with clear structure, transparency, and clinical oversight are far more likely to hold up as scrutiny increases.
Types of International Drug Sourcing Programs and How They Differ
One of the biggest misconceptions in the market is treating international sourcing as a single category. In practice, there are very different approaches, and those differences are what drive variation in both performance and risk.
Some programs are structured as optional pathways. Members are offered the opportunity to access certain high-cost medications through international channels, but they retain full access to the traditional pharmacy benefit if they choose not to participate.
Others take a more aggressive approach, carving specific drugs out of the benefit and requiring members to go through a sourcing vendor or an alternative importation pathway.
Most of the recent scrutiny has focused on programs that require patients to use sourcing, rather than those that leave it as a choice.
From a plan sponsor perspective, this is where strategy and risk begin to intersect.
What a Well-Structured International Drug Sourcing Program Looks Like
The most effective international sourcing programs are focused and selective. They typically target a narrow group of high-cost, self-administered medications where the price difference between the United States and other markets is meaningful, and where distribution is more straightforward.
Stronger models are built with clear guardrails: transparent sourcing pathways, accredited pharmacies, controlled shipping, and pharmacist oversight to ensure patients understand how to safely use their medications.
They are also integrated into the broader pharmacy strategy. Medications are evaluated within the benefit first, where clinical checks, formulary management, and utilization controls already exist, before sourcing is introduced as an option.
That approach keeps sourcing in its proper role. A targeted tool, not a replacement for the benefit itself.
How Employers Should Evaluate International Drug Sourcing Programs
For plan sponsors, the question is no longer whether international sourcing can reduce costs. It can.
The more important question is whether the program is structured in a way that is sustainable.
That starts with a few key questions:
- Is participation voluntary?
- Is the sourcing pathway transparent?
- Are the pharmacies and suppliers clearly identified?
- Is there clinical oversight?
- How are safety issues and recalls handled?
These are the questions that determine whether a sourcing strategy delivers lasting value or introduces new risk.
The Future of International Drug Sourcing for Employer Health Plans
International sourcing is not going away. The cost pressure driving adoption is real, and it is not slowing down. What is changing is how these programs are evaluated.
Expect more structure, more transparency, and more scrutiny, both from regulators and from the market itself. The gap between well-designed programs and higher-risk models will become more visible over time.
International sourcing works, but it has to be done deliberately. The programs that are voluntary, targeted, transparent, and clinically integrated are more likely to hold up over time.
In that form, sourcing is not a workaround. It is a controlled extension of the pharmacy strategy.
