Plan to bring cheap prescription drugs from Canada

The U.S. secretary of health and human services has effectively deep-sixed a plan to bring cheap prescription drugs from Canada. Her reason: The plan was ill-thought out and there may be safety problems.

While proponents of the bill argued that it would help reduce the price of certain drugs, Secretary Donna Shalala told President Clinton in a letter that she could not guarantee safety and a cheaper cost "because of serious flaws and loopholes in the design of the new drug reimportation system."

"The secretary was required by the law to make a finding before the scheme was put into effect, that it would indeed be most likely to be safe and to lower costs for consumers," says Campbell Gardett, a spokesman for the Department of Health and Human Services. "Upon looking at it, we decided that we could not make that finding."

As a result, the department will not ask for the $23 million needed to set up a drug reimportation system from Canada. "Clearly, the secretary's letter makes the point that the prescription drug benefit is something that is still needed, and obviously the administration feels that the wider benefits in the Medicare program is the right way to go," says Gardett.

Many prescription drugs are a lot cheaper in Canada, where prices are controlled by the government. For example, in Vermont, the breast cancer drug Tamoxifin costs $1.65 a pill in Canada, it's just 17 cents a tablet. The ulcer drug Prilosec costs $3.79 per pill, while in Canada the same pill is $1.83.

Lacking such price controls, Americans who buy between one-quarter and one-third of the world's medications pay the highest prices in the world. This year alone, Americans will spend $96.5 billion on brand name prescription drugs, a figure that is rising by 18 percent every year.

Shalala rejected the plan, which was part of an annual appropriations bill for the Food and Drug Administration (FDA) signed into law just prior to the election, for several reasons. First, she felt that flaws within the law would allow drug makers to deny reimporters access to mandatory FDA labeling.

There were also no provisions in the bill to prevent drug manufacturers from requiring distributors to charge higher prices and limit supply to U.S. importers.

The Pharmaceutical Research and Manufacturers of America, a Washington, D.C.-based umbrella organization representing drug makers, had opposed the importation law. Due to holiday closures, they could not be reached for comment. Proponents of the bill argued that Shalala should have implemented the bill and let the pharmaceutical industry react to it. But Alan Sager, the director of the Health Reform Program at Boston University in Boston, thinks Shalala was on the right track.

"Declining to implement the statute when the secretary had discretion about whether or not to implement was not 'chicken' or cowardly," says Sager. "I think the secretary was simply being honest."

"The bill that Congress passed was so crippled at the behest of the drug makers as to be an administrative nightmare," says Sager. "They pretended to rely on foreign governments to regulate price, but then made it unworkable actually to import them in by allowing drug makers to erect administrative roadblocks."

Source: RefillPill.com Editors' Choice