Prescription drug prices send seniors to Canada

By DON McINTOSH, Associate Editor

In search of reasonably-priced pharmaceuticals, next Tuesday a train-car full of West Coast seniors will leave the United States.

The train departs Los Angeles Aug. 23 and arrives in Vancouver, British Columbia, the next day, after stops in Portland and Seattle. A California consumer rights group, the Foundation for Taxpayer and Consumer Rights (FTCR), is paying all travel expenses, because the group wants to make a point.

“We shouldn’t have to go to Canada to get prescription drugs we can afford,” says Jerry Flanagan, the foundation’s health care policy expert.

That thought is echoed by Maribeth Healey of the labor-supported health policy coalition Oregonians for Health Security, which is helping recruit Oregonians to go on the trip.

In Canada, for as long as a drug is given a patent monopoly, the manufacturer's price is regulated by the Patented Medicines Price Review Board, a quasi-judicial body with a mandate to protect consumers by regulating the prices of patent medicines to ensure they're not excessive. Under Canadian law, the drugs can't be more expensive than other drugs in the same therapeutic class; prices of breakthrough drugs can’t be higher than the median price in six European countries and the United States; and by law, prices may not go up faster than the consumer price index. The result is that prescription drugs sell in Canada for 30 to 70 percent of what they sell for in the United States.

The U.S. political system may not be ready for such a simple and direct method of reducing drug prices, considering the money-hold “Big Pharma” has on Washington, D.C.

So, increasingly, Americans are finding ways to import the price-regulated Canadian drugs. An estimated one million U.S. residents are now filling prescriptions through Canadian mail-order pharmacies, spending $800 million a year according to a 2003 study by the Government Accounting Organization (GAO).

That’s still a drop in Americans’ $200 billion a year pharmaceutical bucket. But drug companies, their profits threatened by American access to Canadian prices, are doing everything they can find to restrict the flow.

Several years ago, storefront reimportation operations sprang up around the country, charging a commission to help patients contact Canadian pharmacies. But many of those have closed due to pressure from the Food and Drug Administration (FDA) and state pharmacy boards. In March, the Canada Drug Service, one such business in Tigard, closed because the Oregon Pharmacy Board threatened to prosecute the owners for “practicing pharmacy without a license.”

Many Americans who live near the border simply cross over into Canada to fill prescriptions. It’s perfectly legal under U.S. law to bring back up to a three-month supply.

But much more of the reimportation is taking place via Websites — like,, and [For those who don’t have Internet access, the sites take orders via toll-free phone numbers, such as 1-800-442-9585 or 1-800-891-0844.]

Such shipments technically violate U.S. law because the drugs originate outside FDA jurisdiction.

The FDA has never enforced this law against individuals, presumably because it would be disastrous politically to prosecute elderly widows for trying to make ends meet. But the agency has persuaded U.S. Customs to begin seizing shipments.

Alex Glassey, president of the online pharmacy MedCenter Canada, said that in October 2003 his company began having occasional shipments seized by Customs. Seizures stepped up in late July, however: U.S. Customs is now stopping about one shipment a day. For Glassey, that’s just a cost of doing business. His company, like most Canadian mail-order pharmacies, guarantees delivery, so it re-sends any orders seized by the U.S. government.

Drug companies like Pfizer have also begun blacklisting Canadian pharmacy wholesalers they believe are engaging in reimportation. They’ve also threatened to limit Canadian supplies of drugs to the amount they estimate will be used by Canadians.

Glassey said this has led companies like his to seek out other sources for reimportation, like the United Kingdom, where government cost-controlled pharmaceuticals are cheaper still.

Last year’s Medicare Prescription Drug Act specifically reaffirmed the ban on Canadian drug reimportation —unless the U.S. government could certify the drugs are safe. Tommy Thompson, the President Bush’s appointed head of the Department of Health and Human Services, has so far declined to make that certification.

Jirina Vlk, spokesperson for Health Canada, the government health care system, points out that to protect its own citizens, Canadian government already inspects and certifies Canadian pharmacies, including those that sell via the Internet. And there’s not a single documented case of an American harmed by drugs purchased in Canada that were unsafe.

But that hasn’t prevented the drug industry, the FDA and state pharmacy boards from issuing a continuous stream of scare announcements, saying that they can’t “guarantee” the safety of reimported drugs.

Flanagan asks why Americans should be afraid to buy drugs that are manufactured by U.S. companies and marketed as safe to Canadians.

“How does it become unsafe just because it crosses the border? It’s patently absurd,” he said.

Now, even some state and local governments are facilitating the reimportation of drugs from Canada, in defiance of the federal government.

Three state governments — New Hampshire, Minnesota and Wisconsin — have set up Websites that link to Canadian pharmacies certified as safe. New Hampshire Governor Craig Benson had a Canadian online pharmacy ship prescription drugs to his own residence and then ordered the state forensic lab to test the drugs for purity. The tests confirmed the drugs were identical in every respect to drugs purchased in U.S. pharmacies. The state of New Hampshire is considering purchasing drugs from Canada for inmates in state correctional facilities.

Illinois, calculating it could save $90 million a year, asked Thompson to approve a pilot program for the state import lower cost drugs from Canada for its employees and retirees. The FDA turned down the request in June.

On Aug. 10, the State of Vermont announced it is filing a lawsuit against the FDA in federal court for refusing to approve its reimportation program, which was intended to save money on the prescription drugs it purchases for state employees.

And in Oregon, State Senator Ginny Burdick has said that when the Oregon Legislature convenes in January 2005 she intends to introduce a bill to help Oregonians import Canadian prescription drugs.

Among cities, Springfield, Mass., led the way, announcing it would waive prescription drug co-payments for its employees who agreed to fill their prescriptions through Canadian pharmacies. Now, more than a dozen cities do the same.

Two weeks before its train leaves the station, FTCR sent an invitation to President Bush and Democratic presidential candidate John F. Kerry to hop on board. Kerry is “on board” to the extent that he has pledged to sign a reimportation bill likely to go before the Senate next month. Bush hasn’t said whether he’d sign such a bill.

About 25 seniors will ride the train, a chartered Amtrak sleeper car that FTCR has dubbed the Rx Express. Several will board in Portland, including Jean Scott, a retired member of Service Employees International Union Local 503.

“I feel very strongly about our country saying we are forbidden to get drugs from Canada,” Scott said.

In Vancouver, a Canadian doctor will look over each person’s medical records and re-write their prescriptions. They’ll buy three-month supplies of the drugs they need, and save 30 to 70 percent off the price they’d pay at home.

The cholesterol-reducing drug Lipitor, for example, costs $170 for a three- month supply at 20 mg dose, compared to over $260 at a U.S. pharmacy.

But ultimately the solution isn’t for Americans to buy from Canada, say Flanagan of the FTCR and Healey of Oregonians for Health Security. The solution is for Americans to do something to lower the prices they pay for drugs, which are now the highest in the world.

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