Seniors Make Tough Trip for Cheap Drugs Saturday, November 01, 2003 By Jeff Goldblatt WINDSOR, Ontario — Ron Chapman is waiting when a bus pulls into a Michigan parking lot at 6 a.m. He and a group of other seniors are headed to Canada for cheaper prescription drugs. "I feel real up," said Chapman, who has Parkinson's Disease (search). "I want to live as long as I can. And I don't want to beg but let's do it right." With 43 million Americans riding though life without health insurance, drug drives to Canada have become life-saving staples -- especially for seniors. It's hard to say just how many Americans are getting their prescriptions filled by Canadians. Pharmacy groups estimate that it's about 3 to 4 million prescriptions (search) annually. The Canadian government negotiates its drug prices and with the cheaper dollar, medicine averages about half the price as the same drugs sold in the United States. "The prescription I'm picking up today would have cost me $1,200 in the United States versus $500 here," said Gil Groehn, a Canadian customer. Diagnosed with prostate cancer, Groehn said exorbitant drug prices have forced seniors north. "Myself and other seniors are being virtually raped," he said. But U.S. drugmakers maintain the assertion is not true. Pharmaceutical officials say price controls keep prescription costs down in Canada but that research and development drive prices up in the United States. Eli Lilly (search) is one of several U.S. drug makers now reducing pill supplies to Canada to ensure there's not a surplus to sell to Americans at cheaper prices. "It takes about $800 million to develop and launch the product and only one of three products that actually make it to market, recoup the development cost," said Rob Smith, a spokesman for Eli Lilly. Illinois Gov. Rod Blagojevich has unveiled a plan to make his state the first to buy prescription drugs from Canada, a move he said would save taxpayers $90 million. "There's a pricing structure that's essentially been fixed for a long time that the big pharmaceutical companies are interested in protecting," the Democratic governor said. Other governors have said they'll challenge the federal Food and Drug Administration (search) for the right to do the same. "We're concerned about the safety implications of any state or locality bringing in foreign drugs and about the legal implications if jurisdictions such as that were to do such a thing," said the FDA's William Hubbard. Congress is battling over how to reform Medicare and whether to allow foreign prescription imports. For Ron Chapman, who takes 20 pills a day at a cost of $1,500 a month, the decision about drugs is an easy one: he can't afford not to go to Canada even though it pains him. "I'm an American," Chapman said, his voice quivering. "I'm not a liberal. I'm not a conservative. But I am an American."
It's called capitalism. What good is it to spend millions in R & D money to develop something you have to give away? It's also called a huge bureaucracy named the FDA that drives up prices. Quicken the testing regimen for drugs and treatment and costs will go down. A prescription drug "benefit" is only designed to take us to socialized medicine, which will be a disaster of epic and biblical proportions. Being sick isn't cheap, but is anything worth having cheap? I can't afford a Hummer, but you don't see me going to government complaining that I can't afford one and should get a benefit to have one.
Do you really think a hummer is as important to you as medicine is for these seniors that need it to live? I'm not saying that there isn't an argument against getting these Canadian prescription drugs (by no means at all), I'm just saying your statement likeinnig the two is not only misleading and inaccurate, but gross.
There’s more to this than meets the eye. I’ll see if I can dig up some links when I get a chance, but some years ago the Canadian government, after negotiations with the drug companies, restructured our patent laws for drugs making it MUCH longer before the generic companies could start manufacturing a given drug and competing with the R&D companies. The trade-off, as I recall it, was that the R&D companies would charge much less for their drugs sold in Canada, because they would have a longer period of time to recoup their R&D expenses. The loophole in this plan seems to have been the cross boarder trade, particularly the internet mail order trade which has spawned a huge industry alone. In some places in Canada (particularly Manitoba for reasons I can’t explain) there is a shortage of pharmacists because the online drug vendors are hiring them all at very inflated wages. Strange, strange situation.
It's called capitalism Grizzled, old people have a choice of either dying or leeching off Canadiens. I'll never understand how helping people not die can be viewed as such an evil thing.
Oh no, the locusts are coming! I don't remember reading about biblical disasters in every other industrialized country but us...hmmm.
You imply that Pharmaceutical company profit margins are reasonable. So, wow do they compare to other industries? What would you say if they happened to be higher than ALL other industries, by far?
I certainly think that for the most part everybody should be able to get the basic medication that they need. I’m a Canadian who very much likes our system here, in general. This particular issue, which seems to be an inefficient and problematic on both sides of the boarder, seems to have been caused by an unintended regulatory loophole. From the Canadian perspective we made a trade off (at least this is how I believe it went). We negotiated for a lower initial pricing structure in return for a longer pay back period. IIRC (and I hope I’m not getting myself into tooo much deep water by saying these things off the top of my head before checking my facts) our drug patents run much longer than yours do. This means that in the US R&D companies have to recoup their costs in a shorter period of time and therefore must charge higher prices initially, before the generic companies come into the market. The prices are directly influenced by the patent laws, but this breaks down when drugs destined for one regulatory context get funnelled into a different one. I think the two systems speak to the different values Canadians and Americans place on health care. I certainly think your seniors should be getting at least the basic care that they need at reasonable costs without having to take a bus trip from Houston to Morden Manitoba to do it, but this speaks to the general need for updating of your health care delivery system and policies, IMO. In the short term I don’t begrudge the individuals who are coming, but this situation can’t last. There needs to be a better longer term solution.
This particular issue, which seems to be an inefficient and problematic on both sides of the boarder, seems to have been caused by an unintended regulatory loophole. What is problematic about this? The way I see it: ... American senior citizens get cheaper drugs ... Canadian companies get extra profits for charging lower prices ... American companies that charge artificially high prices lose market share. I think its great having the Canadian system out there. It brings more competition into the marketplace and theoretically would drive down American drug prices if the Canadian effect keeps growing.
I hope you didn't take my post as being against you Grizzled, I was taking a cheap shot at bama after the comparing life sustaining medication to a Hummer. I like the system you guys have, we should at least try something similar. Particularly the part of extending the length of the patent. A company should reep the benefits of creating a drug.
You show your true colors. Who the HELL are you to decide whether or not profits from a product are REASONABLE? Define reasonable. The whole point of designing a product and expending your time and effor into marketing it and bringing it to stores to make as much profit as you can. If you had your way, you could only make so much profit on something (determined by you or your agent the government and not by market forces) and that is wrong. By making more profit, a drug company can re-invest that money into R & D to make better drugs. It's capitalism and it's why we have the best medical system in the world and why the rich from all over come here for treatment. It used to be that people paid for their health care like anything else. When did it become a right to have the govt. take from my hard-earned money to pay for your healthcare when you should pay for it yourself? I'm not at your door with a ski mask and a gun demanding you pay my medical bills, but yet you'd use the government to do the same thing to me?
Actually....not to burst your capitalistic rage...but these are the things that regulatory boards look at when deteriming patents, patent lenghts and so forth. Take a read at Grizzled's posts. This isn't truly unbridled capitalism at work here. It's a highly regulated, public policy industry. Much of the beef here is from the pharmacutical companies crying foul because the canadian vendors are undercutting the us prices. The unintended loophole -- so to speak. If the industry wants its trade and patent protection, it has to convince the regulators that it's just. Carry on...
The problem is that very statement, reasonable. It has nothing to do with patents. But what people don't realize when they rail against the "horrible" and "unfair" profits of drug companies is that when they use the police powers of government to get rid of them, they kill the golden goose. Sure, I don't have a problem with patent issues, just as long as a company is able to exclusively profit for a good while from the painstaking research and all the govt. regulatory hoops they had to go through to get a drug approved. Reduce that patent window and you will eliminate drug research, because if there isn't any profit it in......
Dude, c'mon. The Pharm biz jacks up prices in America because the government allows them to. In Canada, they don't allow price-gouging, so prices are lower.
One of the problems is that this isn’t what the drug companies think they bought into. They have made threats about limiting the amount of certain drugs they will make available to Canadian resellers. There would be significant legal problems with trying that, of course, but in the short term it’s causing some concern. As I mentioned before, this situation is causing a shortage of pharmacists in some areas. Some State governments are even talking about ordering their drugs through Canada, so the volume is becoming huge! It simply doesn’t make sense for this to last long term. American companies are manufacturing drugs, shipping them to Canada only have them mail order shipped back, not very efficient. And while certain people will make a pile of money while this situation lasts, it will be a boom and bust type thing that will do some damage as well. As you said, this will certainly force a correction of some sort, but in the meantime it’s going to be a get rich quick/boom and bust type thing, words that make any Albertan shudder (an in joke for the Canadians in the crowd). Reading the article below made me aware of some other details. Our drug prices are regulated and yours aren’t. There is a suggestion in the article that American consumers are paying the development costs for the drugs, but our pricing and patent structure was set after significant discussions with drug companies, and in the end they were happy with the deal. Since you are the only country that doesn’t regulate drug prices, it looks like it’s going to have to be you that changes rather than everybody else. I’ll be just too tough to keep everybody else’s prescription drugs out. Once again, the internet shrinks the world and moves us ever forward into a global community. http://www.globetechnology.com/servlet/ArticleNews/TPStory/LAC/20031101/DRUGMAIN01/TPTechnology/ And on an almost completely unrelated topic, apparently you’re getting a significant quantity of other drugs from us too. http://www.guardian.co.uk/international/story/0,3604,1077190,00.html I find this very hard to believe, quite frankly, but there it is. bnb will know more about this than me. Canada, the new drug capital of the world.
Regulation does not mean elimination. All kinds of things are regulated for the public good. In fact you’d be hard pressed to think of something that wasn’t regulated in some way. The question is not whether regulation is inherently “bad.” The question is, how much regulation is needed? And that becomes a decision based on the values of a society, enacted by a democratically elected government. You can’t get much more All-American than that.
