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Drugs from Canada: Hardly a panacea

Back in April, I wrote this piece outlining my philosophical objections to the idea of importing/reimporting prescriptions from Canada to cut down on the costs of prescription drugs. But like so many bad ideas, this one keeps coming back. It was last sighted/cited in the second Presidential debate, where Senator Kerry supported it and President Bush voiced concerns.

Jeff Harrell, of The Shape Of Days blog, caught this and expressed his confusion. As many bloggers do (myself no exception), instead of doing his own research, asked his readers to cure his ignorance. I immediately sent him the link to my above piece, then set back to collect my reward as "his new best friend."

It turns out that there are much, MUCH bigger concerns about this proposal than a simple objection to socialism. A few of his commenters (truly wise people, not simple wise guys like me) have actually looked at the issue and come up with some serious problems with it. Go read it here.

J.



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Comments (22)

I prefer to get my drugs di... (Below threshold)
OneDrummer:

I prefer to get my drugs direct from Canadian programmers...

Which countries are actuall... (Below threshold)
Ripper:

Which countries are actually at issue? Does the legistlation say "Canada" or are their criteria for this outsourcing? If we present the issue as drugs from India, Canada, Togo, and Mexico how would it poll?

To make matters worse, sinc... (Below threshold)

To make matters worse, since producers face price controls in Canada, they're forced to recoup their R&D costs by raising prices elsewhere--i.e., the United States. So the Canadians are part of the problem with higher costs in the U.S.

Ripper, The Pharmaceutical ... (Below threshold)

Ripper, The Pharmaceutical Market Access Act of 2003 would require SecHHS to issue regulations allowing the importation of drugs from 25 countries, including Canada, Australia, Europe (Europe is considered as a single country for the purposes of imports), Israel, South Africa, Japan and New Zealand. I don't have a complete list. This list comes from the CBO.

Your objection seems to ste... (Below threshold)
wah:

Your objection seems to stem from the statement...

"The main problem with this: itís technically illegal."

It's only 'technically' illegal because the Bush administration keeps it so. This is despite a Bush campaign promise in 2000 to fix the problem.

It's also quite illustrative of Neocon ideology. The corporations get to cross international borders to do business to maximize profits, the citizens are kept in a nice holding pen, where they get fleeced repeatedly.

"** SPECIAL BONUS QUIZ! Tes... (Below threshold)

"** SPECIAL BONUS QUIZ! Test your comprehension: How many lifesaving drugs have been invented recently in countries with socialized medicine? Hint: a non-negative integer less than 1.

"
haha

The fact that Canada has pr... (Below threshold)
DaveV:

The fact that Canada has price controls and that re-importation would take advantage of those controls is no reason to use it as a at least a pressure tactic to do 2 things:

1. Pressure the drug companies to lower drug prices overall

2. Pressure other countries to ease price controls on their drugs so that the whole world bears the cost on a more equal basis of R&D

The drug companies will not pull back on their R&D based on lower drug prices because they need to have the next "blockbuster" drug to remain profitable. What it may have an effect on is research on "limited use drugs" (orphan drugs) which we the taxpayers would have to subsudize to a certain extent.

Dave (the other one)

The fact that Canada has pr... (Below threshold)
DaveV:

The fact that Canada has price controls and that re-importation would take advantage of those controls is no reason to use it as a at least a pressure tactic to do 2 things:

1. Pressure the drug companies to lower drug prices overall

2. Pressure other countries to ease price controls on their drugs so that the whole world bears the cost on a more equal basis of R&D

The drug companies will not pull back on their R&D based on lower drug prices because they need to have the next "blockbuster" drug to remain profitable. What it may have an effect on is research on "limited use drugs" (orphan drugs) which we the taxpayers would have to subsudize to a certain extent.

Dave (the other one)

I have a better idea for ho... (Below threshold)

I have a better idea for how to get other countries to ease price controls: the WTO.

I've asked this before, probably somewhere else -- Aren't Canada-style price controls a violation of the WTO treaty? If so, we don't need to dick around with reimporting drugs from other countries. Just file an unfair trade complaint on the basis that other countries' price controls are forcing American prescription drug users to subsidize drugs for people in those other countries.

I'm still waiting for someone to answer my question about the WTO.

--"** SPECIAL BONUS ... (Below threshold)
wah:

--
"** SPECIAL BONUS QUIZ! Test your comprehension: How many lifesaving drugs have been invented recently in countries with socialized medicine? "
--

It's not all drugs these days, ya silly fundie. The main ones we seem to be spending billions of dollars on mostly make dicks hard for out of shape, lazy-asses. I think there are what, 4 of those now?

--
"Natural" heart pacemakers made from human stem cells have been successfully tested in pigs.
Ultimately, this technology could replace the electronic pacemakers currently used to treat humans with irregular heartbeats, scientists hope.

The Israeli team from Technion-Israel Institute of Technology, along with US colleagues, took the stem cells from donated human embryos. "
--

Now you get to argue that Israel doesn't have 'socialized medicine'.

Good luck.

http://web.mit.edu/mitsi/www/heb/healthcare.htm

Also, human physiology is finite and necessity is the mother of invention. Many of the drugs being researched today with the big co's are retreads of existing, effective medications. They simply need new ones to replace income after the old ones lose patent protection.

We have reached the downward slope on chemical compound treatments, but the price is ratcheting up.

Also, advertising drugs on TV is the stoopid, and the practice is raising healthcare costs orders of magnitude faster than lawyers suing companies that 'knew the risk' but 'took the chance'.

Fleeced, I tell you.

http://bernie.house.gov/prescriptions/profits.asp

Goodness, but you're an unp... (Below threshold)

Goodness, but you're an unpleasant little cuss.

Advertising drugs on televi... (Below threshold)

Advertising drugs on television is not a stupid idea.
The costs of advertising the drug is minimal to the cost of actually financing the research of the drug.
Besides, if there were no advertisements for drugs, then how would the public/doctors know about them? Drug companies send free samples and all sorts of advertisements to doctors/hospitals (use my drug), but seriously, advertisement is a good way to get the public asking about the drug. Look at Enzyte (for natural male enhancement). There is a huge advertisement blitz, that otherwise, would relegate Enzyte among all the other penis-englargement pills that are out there (marketed by ron jeremy at 3:00 AM on spike tv).

Bernie Sanders is a great s... (Below threshold)
Steve L.:

Bernie Sanders is a great source of information for raving moonbats. Vermont is just about the most liberal state in the union. That Sanders calls himself an "independent" is absolutely hilarious. If you can point out one position of his that is anything other than straight out of the Democrat playbook, I would be shocked.

"Legalizing" drug purchases from Canada won't do a thing. The laws of supply and demand say that manufactruers produce LESS of something if prices are lowered. With the supply squeezed, prices go UP. In an unbalaned situation (prices are significantly different from place to place), the drug companies will cut back on sales in areas where prices are low and shift focus to areas where prices are high. As a result, it will be difficult to buy those drugs in Canada. The only solution would be for the Canadian government to ease the price controls to encourage manufacturers to send more drugs to Canada.

Another thing to understand about prescription drugs is that the price is very inelastic. Because prescription drugs are, in a sense, "life saving," people will buy them regardless of the price. Prices can fluctuate wildly and have little effect on demand. This further drives companies toward the higher end of a price range.

THis is all the typical political noise of "I don't know what his position is, but I am against it."

Actually, Steve, Bernie San... (Below threshold)

Actually, Steve, Bernie Sanders is an avowed Socialist -- and the only one in Congress who doesn't pretend to be in the political mainstream by running under false (Democrat) colors.

Yes...so Liberals would rat... (Below threshold)
Branna:

Yes...so Liberals would rather have bad drugs so when something goes wrong they can have someone ELSE to blame. Like the AFL-CIO loves to say...it's a great country!

Sick pups.

Howdy folks,Henry,... (Below threshold)
wah:

Howdy folks,

Henry,

"The costs of advertising the drug is minimal to the cost of actually financing the research of the drug."

You haven't been following trends in the industry lately, have you? The 'marketing' junkets for doctors to the bahamas, the billions spent on mass media 'direct-to-consumer' advertising, the fleets of hottie drug reps.

Here's some more information to ignore.

----
Among the nine pharmaceutical companies examined in the report (Merck, Pfizer, Bristol-Myers Squibb, Pharmacia, Abbott Laboratories, American Home Products, Eli Lilly, Schering-Plough, and Allergan), all but one (Eli Lilly) spent more than twice as much on marketing, advertising, and administration than they did on research and development, and Lilly spent more than one and one-half times as much. Six out of the nine companies made more money in net profits than they spent on research and development last year.
---
http://www.namiscc.org/newsletters/July01/DrugPrices.htm

"Besides, if there were no advertisements for drugs, then how would the public/doctors know about them? "

Those whose profession it is to cure sickness are more than capable of identifying useful remedies. Instead, we have doctors being BOMBARDED with this crap, and also put in the unfortunate situation of having to deal with patients who 'have all the symptons they mentioned in the commercial'. Now the Dr.s have to deal with misinformed hypocondriacs, rather than sick patients.

"Look at Enzyte (for natural male enhancement). There is a huge advertisement blitz, that otherwise, would relegate Enzyte among all the other penis-englargement pills that are out there."

The thing about Enzyte is that it is simply masquerading as a 'real drug'. The fine print "These statements have not been evaluated by the Food and Drug Administration. Enzyte is not intended to diagnose, treat, cure, or prevent any disease."

It's a confidence booster, nothing more. A con job. Crush up some rhino horm or shark cartilage and FEEL VIGOROUS.

Steve L,

"The laws of supply and demand say that manufactruers produce LESS of something if prices are lowered. "

You have a strange conception of economics. There is quite a bit more to it than that. Not the least of which is the nature of 'intellectual property' (cue random tangent that misses the next part of the argument).

"In an unbalaned situation (prices are significantly different from place to place), the drug companies will cut back on sales in areas where prices are low and shift focus to areas where prices are high."

This is simply not the case. If it were true, the pharmaceutical companies would not sell ANY drugs in ANY country other than the U.S. As it stands, we are subsidizin the rest of the world and the drug companies get both those profits and get federal money to help offset research costs. This is how it stands now.

"More than half the money needed to create top-selling prescription drugs came from U.S. taxpayers and not industry investment.

Best sellers like the ulcer-curing Zantac or Zovirax, which treats herpes simplex, were developed and tested chiefly through grants from the National Institutes of Health. Out of 131 studies, clinical trials and other tests on five best sellers from 1995, the NIH deemed only one industry study as key to a drug's development for use and sale."

So, again, it's a federal giveaway to corporate backers who make money coming and going and lobby the federal government to keep Americans from having the same cross-border options the companies do.

Then you say
---
"Because prescription drugs are, in a sense, "life saving," people will buy them regardless of the price. Prices can fluctuate wildly and have little effect on demand. This further drives companies toward the higher end of a price range."
---
That is true is some sense, but the price is also totally unrelated to the continued cost of production. Prescription drugs are 'intellectual property' once a formula and method are worked out (the tough part) it can be repeated for pennies.

In such markets, (see also: TV, Movies, Music, Books) promotional costs soar as one can spend more money to drive up demand, as the initial investiment, the hard part, is already done.

Thus, if I spend $.50 to convince you to buy a $1.00 pill that cost $.03 to produce, I win big.

Did ya'll notice all the Nobel Prize winning economists that support Kerry?

http://www.msnbc.msn.com/id/5818277/

Have a good one. I hope you found this discussion helpful

You were saying?

--
THis is all the typical political noise of "I don't know what his position is, but I am against it."
---

/cue ad hominem attacks on 'socialists'.

Some things never change. ... (Below threshold)
Branna:

Some things never change. It's the same rivalry that caused conflict between the north & the south. Only now it's global. Pricing conflicts. Geez..... Either way it's still gonna cost us...I think those other countries should pay for the standards set or don't sell in this country.

With all this going on I'm glad I refuse to take flu shots. God only knows what's in them anyway.

It makes you wonder how Americans survived after the civil war...thru the industrial revolution.. and so on. What the heck are we caught up in?

So, hand me over one of the... (Below threshold)
OneDrummer:

So, hand me over one of them hottie drug reps, some Cialis (need that 4 hour erection, ya know) and then some Zorviax, cuz lord knows them hotties get around.....

I'm always grinning about those socialists who want to live in the utopia of the US, and then condemn it as a worthless society... if socialism is so great, why aren't they living in Europe somewhere?

Onedrummer,Are you... (Below threshold)
Wah:

Onedrummer,

Are you in a band? You were right on cue.

/cue ad hominem attacks on 'socialists'.
--
I'm always grinning about those socialists who want to live in the utopia of the US, and then condemn it as a worthless society.

What I find, well, infuriating is when ideologues cannot even entertain valid criticism of their ideologies.

This is similar to how anyone who criticizes Israeli policies is smeared as anti-semitic.

It makes no sense in any but the stark black and white world of blind ideological faith.

The 20th century, I had thought, taught humanity that holding to a ideology when it has proved flawed is a mistake. That blind obedience to a falsehood leads to the death of millions of people.

Instead, the lesson that seems to be taken is ...Liberal==Evil.

Strange. Particularly when that meme comes from an ideology all it's own.

Frankly, I don't live in 'Eurpoe or wherever' because I was born in Texas and I love this country.

I rant because I hate to see it dragged through the gutter by blind ideologues.

well I'm a Canadian and wh... (Below threshold)
wannabe:

well I'm a Canadian and while I may or may not benefit from Canada's drug laws, I have discovered from personal experience that sometimes generic isn't comparable vis a vis the way it actualy works, side effects etc - let me ask you this - what was the last great drug discovery coming out of Canada - bet we can't think of one!

because it seems to me you have to allow the companies who take the risks to develop new drugs to recoup their investments

and no one is going to R & D in Canada if the government has taken away the incentive....

of course the way the Canadian law is structured I think you don't have to do R & D in Canada, they can steal your work and make generics.....

something not right about that....

My job forces me to spend m... (Below threshold)
dinka:

My job forces me to spend much of my time at Big Pharma here in the US. I constantly talk with directors of research. I have been flat out told that some new promising drugs under development will not be sold in Canada.

It would be unfortunate if a backlash over cost controls and over-border sales of drugs caused the Canadian citizens to not have access to life-saving, or life-improving drug therapies. Another example of socialized medicine actually hurting not helping the populace.

You sure do get around, don... (Below threshold)
Henry:

You sure do get around, don't you Wah, are you involved in this industry that you know everything about it? I honestly admit that I'm only a student studying mechanical engineering (with a little bit of an emphasis towards HVAC + R), so I don't follow "trends" or "markets" or "prices" and such.

I only put Enzyte up as an example. I know its full of crap. I'm just saying that advertisement is one way to get their product out. That's the difference between a socialistic health care system and ours. In ours, the companies actually try to make money,so they bombard the public/doctors with samples/advertisements (just like every other product out there).
I am quite aware doctors get bombarded with crap and patients come in delusionary about certain drugs. And I've also heard stories of doctors getting kick-backs from drug companies to over-prescribe their drug (not sure if thats true, conspiracy theorists of the world unite!) I'm just saying if the drug companies DON'T advertise, then no one will know about their product, and they definitely won't be able to recoup their losses.

"Instead, the lesson that seems to be taken is ...Liberal==Evil."

Not really, Liberals really do have good ideas. Its how they carry out those ideas (or lack thereof) that leads many into question (not all are bad I know). Its a great thing to have great ideas. Ideas are wonderful. How easy is it to put those great ideas into service?

I remember this one discussion I read that talked about wording of polls (I don't remember who wrote it or where it came from). It asked the reader "Do you support a law that keeps guns out of the hands of criminals?". The author went on to say that you would have a hard time finding someone who would say no to that one. (but enough on the wording of polls..that would get me into a whole other rant...i digress)

Sure its a good idea to keep guns out of the hands of criminals, but how would you go about implementing that? Its not so easy from that side of the coin is it?

Another implementation: Whenthe Bolsheviks came into power in Russia and they created their Socialistic/Communistic State, they created a huge mess. I was reading this one book a while ago about the MIG-29 pilot who flew to Japan to defect to the US. He discussed the "New Soviet Man" and where perfect communism would lead to: The government would fade away, and everything would act as it should. Well, they had it wrong, their form of communism abhorred a black hole of power. They just kept getting more and more dependant on the huge government to do everything for them. When he finally defected to the US and he reached here, and lived among American Citizens, he realized that America was closer to "new communism" than USSR ever was!




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