Republican Vermont Gov. Phil Scott said he supported the legislation because it could reduce costs for many Vermonters.
"I'm in favor of doing whatever we can do reduce cost for Vermonters," Scott said.
The U.S. Department of Health and Human Services still needs to certify the program. HHS Secretary Alex Azar called plans to import prescription drugs from Canada a "gimmick" during a speech Monday.
"It has been assessed multiple times by the Congressional Budget Office, and CBO has said it would have no meaningful effect," Azar said.
Dozens of states across the country are looking for ways to save money on prescription drug costs, including some that suggested importing drugs from Canada, where prescription drugs cost an average of 30 percent less than in the United States.
The National Academy for State Health Policy says Vermont is the first state in the nation to approve the importation of prescription drugs from Canada.
The Vermont law would set up a mechanism by which the drugs would be imported and then distributed across the state.
The bill received unanimous support in the state Senate and was approved 141-2 in the House.
The Pharmaceutical Research and Manufacturers of America, a trade group for drugmakers, has argued the proposals would threaten people's health because quality could not be assured.
Scott said he's confident the program would be able to ensure the safety of the drugs.
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