Anxious to avoid more than $3 billion in proposed budget cuts to health programs, California lawmakers Tuesday explored whether the state might save hundreds of millions of dollars buying drugs from Canada.

Without federal approval, the state action would violate U.S. Food and Drug Administration rules. Still, California and several other states have started looking north for cheaper prescription medicines as soaring drug costs and ballooning budget deficits have made health officials increasingly desperate for more ways to save patients money on drugs.

Because the Canadian government regulates drug prices, prescriptions there can be up to 80 percent cheaper than the typical retail price in American pharmacies, where prices are not capped by law.

Assemblyman Dario Frommer, D-Los Angeles, called on Gov. Arnold Schwarzenegger Tuesday to work with other governors seeking federal approval for states to purchase Canadian drugs.

In the meantime, Frommer made a proposal at an Assembly Health Committee hearing. He sketched out a plan for legislation that would review drug spending in various health programs for the poor, state employees, prisoners and others to pinpoint how much the state might save buying drugs directly from Canada.

If it was implemented, California might, for example, first use Canadian pharmacies to fill prescriptions in the Department of Corrections and then, if that saves money, later try buying drugs for Medi-Cal or Healthy Families the same way.

"Americans are paying more for prescription drugs than any other country in the world," Frommer said. "First, we pay for the research. Then, we pay the highest prices. It simply isn't fair."

Frommer would also seek to help consumers purchase drugs from Canada by setting up a Web site linking consumers to Canadian mail-order pharmacies that met certain safety criteria. He intends to introduce his legislative package within a week.

Ashley Snee, a spokeswoman for Gov. Arnold Schwartzenegger, said it was too soon to comment on Frommer's proposal.

"In terms of the drug re-importation issue at this point, there are some challenges," Snee said. "There are legal as well as quality control issues to consider."

The U.S. Food and Drug Administration does not allow states to buy drugs from Canada and has recently vowed to step up efforts to prevent state and local governments from encouraging such purchases by individual consumers.

Brenda Holman, a regional director for the FDA, told members of the Assembly Health Committee that federal regulators have grave concerns about the safety of drugs sold over the Internet. Even drugs purchased directly from Canadian pharmacies and certified by state officials could have safety problems that put consumers at risk, Holman said.

"We are hearing from states who are interested in Canadian drugs and we are listening to them," Holman said. "Right now we are reluctant to consider approving anything outside the U.S."

Canadian pharmacy representatives testifying in the Assembly said drug safety standards in that country met and often exceeded standards set by the FDA.

Several American drug manufacturers have threatened to cut off supplies to Canadian pharmacies that re-import to the U.S. As a result, Canadian pharmacies do not want to sell drugs directly to states or cities.

Despite the federal ban on the purchase of prescription medications from Canadian pharmacies, several U.S. cities -- including San Francisco -- and states have proposed some type of plan to re-import drugs from Canada

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