Globe and Mail, Thursday Oct 30, page A 17
Is Big Pharma Pulling Canada's Chain?
Alan Cassels
It's as if there were a sign outside Tunney's Pasture, Health Canada's
home in Ottawa, that reads, "Gone Fishing." For as pressure mounts
from American pharmaceutical manufacturers for Canada to stop selling
our cheaper drugs to Americans via the Internet, Health Canada is
casting for evidence that the cross-border trade may be causing drug
shortages here at home.
But Health Canada officials might as well stow their rods; they'll
only find red herrings. The fact is that despite repeated warnings of
the disaster that will befall Canadians when angry U.S. drug companies
restrict their supply of drugs to Canada, no one has produced such
evidence. Nor are they likely to.
Canadians can ignore "the sky is falling" pronouncements about
shortages in our pharmaceutical supply -- because at the end of the
day, money talks. And multinational drug companies are still extremely
profitable in Canada.
Will Big Pharma companies restrict their supply of billions of dollars
worth of product to Canada because a tiny portion gets sold back to
U.S. customers at lower prices? Given that logic, U.S. pharmaceutical
manufacturers would have to restrict supply to every country that has
cheaper prices and Internet connections -- which means most of the
world.
The main issue here is visibility and precedent. Earlier this year,
there was news of a leaked U.S. pharmaceutical manufacturers' document
which said the industry was earmarking $1-million (U.S.) to "change
the Canadian health-care system."
Well, what we're seeing now is that lobbying money at work. As long as
there are large price discrepancies between our two countries, Canada
and our policies will naturally be in the crosshairs of the U.S.
drug-makers. Before we allow our federal health agency out on another
fishing expedition, let's remember that this latest red herring swims
alongside a large school of equally fatuous pseudo-warnings issued by
federal health regulators on both sides of the border.
Because U.S. citizens are paying some of the highest prescription drug
prices in the world, they naturally turn to the Internet for cheaper
options. Canada is a relatively trustworthy neighbour, with some good
recent history of supplying cheaper branded drugs to seniors living
along the border, so we've become the pharmacy of choice.
And not just for individuals: The governors of Minnesota, Illinois,
Iowa and Wisconsin have all announced that they want to import cheaper
medicines from Canada, thereby saving state budgets and taxpayers
millions. Illinois Governor Rod Blagojevich estimates that his state
could save as much as $56.5-million a year on prescription drugs for
state employees and retirees by reimporting American-made drugs from
countries with cheaper prices.
Ah, ask critics, such as the U.S. Food and Drug Administration, are
those drugs safe? And who will pay for the research and development of
future medicines if U.S. pharma loses too much revenue?
More red-herring distractions. The fact is, most American brand-name
drugs, when they aren't made in places like New Jersey, come from
places like Puerto Rico, usually using the same processes, quality
standards and safeguards as U.S.-based manufacturers. If a drug
becomes "unsafe" every time it crosses a border, then U.S. citizens
should be concerned about their entire drug supply.
What about the fear that Canadian-style price-controls could inhibit
the development of new drugs? Drug-industry supporters call countries
that control drug prices "parasites." The industry often says that
those paying cheaper prices are being subsidized by U.S. research and
development, which is in turn funded by high U.S. prices.
This argument might hold some water, were it not for the fact that the
U.S. drug industry spends about three times more money marketing its
products than researching them in the first place. Here's a reverse
question: Should Canadians be subsidizing Americans' habit of being
bombarded by drug ads?
What Health Canada ought to do is go fishing for evidence that
U.S.-style drug ads are being unleashed here in our country. They may
catch more than they bargained for.
Alan Cassels is a drug policy researcher with University of Victoria's
School of Health Information Science.