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June 17, 2004
You'd Think It Was An Election Year or Something
There are several Canadian drug reimportation bills floating around in the House and Senate, and it's anyone's guess whether one of them will come up for a vote this session. The AARP has just weighed in in favor of S. 2328, sponsored by Bill Dorgan and Olympia Snowe - and if you're an elected official, the AARP is not to be taken lightly. Of course, neither is the drug industry, so we're set up for a fine Godzilla-versus-Rodan spectacle if the bill ever gets to the floor.
You can see the maneuvering going on. In addition to the AARP's statement, the General Accounting Office has released a study where they tried out dozens of online pharmacies. This one can be spun both ways, depending on where you stand: "US, Canadian Web Pharmacies Generally Safe" or "Many Online Drugs Fake, Study Says." Both headlines are accurate, as far as I can see. The GAO was ordering from as far afield as Turkey, which requires (no offense to the Turkish pharmacy distributors in the audience) a bit of a leap of faith.
I continue to think that the drug-safety argument is a long-term loser for the industry, because it's a problem that can be addressed. The Dorgan-Snowe bill has plenty of provisions to do just that, along with some to prevent drug companies from cutting down supplies to non-US pharmacies. The bill can be summarized as: We have ways of making you sell at the prices we like.
But do they have ways of making us discover and market drugs more cheaply? Or is that going to be our department? I realize that we in the drug business need faster, cheaper methods of finding new therapies - but you know, it's not like we lack incentives - green folding ones - to do that already. And we've been throwing substantial sums at those problems, without all that much to show for it. Would price controls have helped us, do you think?
No, the real arguments against reimportation are economic, and if you don't believe me on that one, believe an economist, Alex Tabarrok over at Marginal Revolution:
Price controls or other such plans such as reimportation may bring cheaper pharmaceuticals for a short period but we will then have a much smaller supply of new drugs forever. Only the shortsighted would buy that prescription.
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