Importing Drugs

[yuki]

Hi,

I saw on the Today's show this morning about a trend that more and more people are importing drugs from Canada because it cheaper, and how this increases patient's risks of getting counterfeit or substandard drugs, let alone not having proper consultations with pharmacists. My understanding is that the prices of drugs are determined by the manufacturers and they supposedly need to keep the prices at a certain level to fund for research. However, it was stated that lipitor
from US costco is approx $100 more than it is in costco in Canada. What gives?
Can anyone care to shed some light?
Thanks in advance.

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[ultracet]

Hi,

I saw on the Today's show this morning about a trend that more and more people are importing drugs from Canada because it cheaper, and how this increases patient's risks of getting counterfeit or substandard drugs, let alone not having proper consultations with pharmacists. My understanding is that the prices of drugs are determined by the manufacturers and they supposedly need to keep the prices at a certain level to fund for research. However, it was stated that lipitor
from US costco is approx $100 more than it is in costco in Canada. What gives?
Can anyone care to shed some light?
Thanks in advance.

canada has semi socialized health care and the gov't decides how much the manufacturer will charge for a certain drug.

Here the manf.s have to make up for research involved and profits not made elsewhere and thanks to capitalization the price goes up.

 

[Tuck]

Canada does have price controls on drugs and the govt. negotiates with manufactures. I think it unlikely that drug importation will become a huge issue because even if they exported every drug back to the US, it would still not make a significant dent in demand. In addition, the canadian govt is beginning to crack down on this since they certainly do not want the manufacturers to raise prices on them, which will most definately happen if it continues.

 

[Tyrol]

canada has semi socialized health care and the gov't decides how much the manufacturer will charge for a certain drug.

Here the manf.s have to make up for research involved and profits not made elsewhere and thanks to capitalization the price goes up.

BBmuffin is right on target-
Other countires need to shoulder some of the R&D costs of drug development. It costs 300-600 million dollars per drug to make it through phase I, II and III clinical trials and come to market. You combine A)these costs with B)the price controls of other countries and you get: c)Americans paying the costs of the world's pharmaceuticals.
This is not to say price-gouging doesn't exist (for example, in 1996 AstraZeneca made more profit on one drug, Prilosec, than all of the worldwide McDonalds and Burger King restaurants combined) However this is the exception and not the rule.
Neither price controls in this country nor socialization are the answer to
rising domestic drug costs. A market-driven profit incentive must remain in order for companies to risk hundreds of millions of dollars on R&D burn. I am all for subsidizing US manufactured drugs for third world countries. However it is ridiculous that countries like Switzerland, France, Canada, etc. cannot afford to equally shoulder some of the burden. Especially when a number of these countries can afford extensive healthcare because they spend so little of their national GDP on defense, once again thanks to the American taxpayer (but thats another story....)