A patient recently came to the clinic and wanted written prescriptions for all of her medications.  I told her I could call them into her pharmacy and save us both time. She said that she wanted them written out so she could send them to Canada.  She was taking tamoxifen which is a medication patients use after they have had a breast cancer.  The cost at her local pharmacy was $140.00 for a three-month supply.  She received the same prescription from Canada for $45.00.  She was also taking a drug called Celebrex which costs $92.00 in the United States and  $54.00 when she obtained it from Canada.  Lastly, she was taking a cholesterol medication which cost $275.00 in American pharmacies but only $200.00 from Canada pharmacies.  Prescriptions were written as she requested.  The very next patient that came into the clinic wanted the same thing and was not related to the first person at all.  This second person had a number of questions.  Those questions form the content of this column.

     1.  Why are the medications cheaper when purchased in a foreign country like Canada than they are in the United States?  As I have read about this problem, the basic difference seems to be the difference in the value of one country’s currency vs another.  At this time, the United States dollar is worth a $1.35 in Canada.  In 1992, the Canadian government agreed to recognize United States patents in exchange for a negotiated discount on United States drugs imported to Canada.  The pharmaceutical industry in the United States really didn’t consider the re-importation of these drugs to be an issue in 1992 and in fact it is not really an issue to them today.  The cost of United States pharmaceutical products in the United States is $252 billion dollars a year.  Cost of the importation of drugs from Canada is about $1 billion dollars a year, so the re-importation of Canadian drugs is a very minor problem at this point in the overall picture of the pharmaceutical industry.
 The bottom line is the reason the drugs are cheaper in a foreign country is that their currency has a lesser value than United States currency.  Foreign governments have negotiated prices so that their citizens will have the same relative medical expenses as citizens in the United States.

     2.  Is the importation of these drugs legal?  In 1987, laws were passed by the United States government making it perfectly legal to import 90-days worth of drugs for an individual person’s use.  Ordering or receiving more than a 90-day supply at one time is banned by the same law.

     3.  Are the imported medications safe?  This is not a directly answerable question.  The FDA requires that a medication sold in the United States be of a certain purity.  In addition, the medication must be free of any harmful impurity.  If a medication is supposed to be a 10 mg size pill, there are limitations to how far the manufacturer may over or undersize the pill but the medication must be very near 10 mg.  There are expiration dates in addition.  If a medication is manufactured in the United States or any other country and sold in the United States, these restrictions apply.  If the medication is then imported to Canada and brought back into the United States by mail order, it would seem that the medication is perfectly safe.

 But there are stories of medications being imported from India, Mexico and South America where FDA standards were not met.  Specifically the most common discrepancy is a medication with little or no active drug.  While the prices may be quite spectacular, it is still a swindle if the medication is not effective. Rarely are medications obtained from mail order companies patently contaminated or unsafe.  If the medication received has the same size, shape, and markings as the United States sold pill, it will be felt most likely that the drug is safe.

     4.  Is the Canadian connection going to last or is it going to grow?  At this time, Canadian drug importation into the United States is a relatively minor consideration as the dollar numbers above would indicate.  If the importation problem were to grow, the United States pharmaceutical companies would simply restrict the amount of drug that can be imported to Canada for re-importation to the United States.  The Canadians would then be required to serve their own citizens and the amount of medication available for re-importation would dry up.  For  now citizens in the United States purchasing brand name drugs can probably save substantial amounts of money by ordering from Canada.  If the person’s medications are generic and no longer under patent, there is very little price advantage ordering from Canada.

     5.  Why do medications have to cost so much?  As surprising as it may sound, medications are for the most part competitively priced.  To bring a drug from the laboratory  through all of the clinical trials necessary and then finally to your local pharmacy costs about $100 million dollars.  Within two years, 10% of the new drugs that come on the market are withdrawn for various reasons.  The $100 million dollars spent on those drugs is just gone.  No company can incur that kind of loss very long and stay in business.  Thus the economics of bringing a new drug to the market is quite expensive.  If one notices, the dividends from pharmaceutical companies are really not that big.  Proctor and Gamble, General Motors, and a host of banking stocks all have a much lower price to earnings ratio than pharmaceutical stocks.  Drug prices are expensive but pharmaceutical companies are not making windfall profits even at what seems to be excessive prices.

     6.  Are there are programs available to help individuals who can’t afford their medications?  Pharmaceutical companies have become much more attuned to the potential that price controls will be placed on medications by the United States government. The new Medicare law will probably soon allow the government to negotiate prices for medications. Insurance companies will demand the same price considerations and the price of medications will probably drop. To that end, pharmaceutical companies have gone out of their way to try to accommodate individuals with limited incomes and substantial drug expense.  Your local clinics can help with adjusting medications to lower price-equivalent medications. The clinics may also  provide pharmaceutical sponsored programs with very substantial discounts on the medications.  Contacts can be made with your healthcare provider at your local clinic to help with these programs.