Canadian Drugs: Do You Pay in Loonies?

By November 30, 2006Health Care

A healthy dose of post-election skepticism has surfaced lately in response to the anticipated push in Congress to allow — or rather, expand — the importation of prescription drugs from Canada. The proponents, including many politicians of both parties from northern tier states, contend that allowing patients to reimport U.S.-manufactured pharmaceuticals from Canada would bring great relief to consumers from the high costs of prescription drugs. Canada’s socialist health-care system imposes caps on drug prices.

Over the long Thanksgiving holiday, The Associated Press carried an excellent and somewhat skeptical piece about the real impact and political prospects of drug reimportation. Best MSM roundup piece we’ve seen.

Amity Schlaes, Bloomberg columnist and currently visiting senior fellow at the Council of Foreign Relations, makes the essential argument in her new column on reimportation. In the short term, some consumers, especially senior citizens, might benefit; in the long term, the practice would undermine drug company research and development. Many of us might not notice until we need new drugs several decades from now:

Every year that Americans pay full price for drugs is a year that innovation continues. So even little steps, such as protecting U.S. patents or rejecting imports, including cheap knock-off drugs, are a help.

In other words, there is an additional contract at issue here, beyond the short-term one between the octogenarian and the Internet pharmacy. It is the intergenerational contract between senior citizens and their great-grandchildren. If cheaper drugs today mean no new drugs tomorrow, seniors may reconsider whether the Canada deal is one they want the Democrats to make.

Schlaes also notes the one issue that the AP story omitted: Canadian pharmacists are fighting the idea. From the CP:

Canadian pharmacists are bracing for widespread drug shortages as U.S. Democrats in the new Congress discuss legalizing imports from Canada.

A coalition of Canadian pharmacy and patient advocacy groups is now asking Ottawa to ban prescription drug exports to the U.S., fearing that if U.S. chains start filling their prescriptions with cheaper Canadian drugs, prices will rise at home.

The NAM issued a position paper on the topic in July 2005.