Look Who's Running Drugs

By Christine Gorman Sunday, July 21, 2002
    • For years, U.S. citizens living in northern border states from Maine to Washington have been slipping into Canada to pick up prescription drugs at cut-rate prices. The Senate passed a proposal last week that would make it easier to ship Canadian drugs directly to the U.S. But opposition from the drug industry is fierce, and Washington handicappers give the measure little chance of becoming law.

    So where does that leave price-conscious consumers — especially those senior citizens whose drug costs are not covered by Medicare?


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    On the Internet, of course. In the past two years, online providers in Canada have been doing a booming business selling prescription drugs to Americans via the Web. Dave Robertson, an Alberta pharmacist who founded CrossBorderPharmacy.com , reports that his company has been filling 1,000 prescriptions a day and predicts that number could rise to 10,000 by December.

    It's easy to see why. Canadian price controls and the weak Canadian dollar mean that popular prescription drugs in Canada can be 35% to 80% less expensive than their U.S. counterparts. "I've heard stories of entire condominium complexes in Florida that order their drugs from Canadian websites," says Billy Shawn, founder of TheCanadianDrugStore.com .

    Is this legal? It's debatable. Although the U.S. has not yet cracked down on the practice, Canadian authorities are starting to. Officials in the province of Ontario laid charges against TheCanadianDrugstore.com last May for, among other things, operating as an unlicensed pharmacy. (The company, undeterred, moved key operations to British Columbia.) And because patients are buying outside the law, they have no recourse if they get sent the wrong drugs or second-rate counterfeits.

    In any event, drug manufacturers are unlikely to let this back door open much wider. Since they make more money on drugs sold in the U.S., they will doubtless limit shipments to Canada if too many Americans start buying there.

    Meanwhile, there are less risky ways of reducing your prescription costs. Start by talking frankly to your doctors about your financial needs. They may be able to switch you to older, less expensive prescription drugs that are just as effective. They can also help you apply to the assistance programs many drug companies have created for folks who have no insurance or meet certain income guidelines. You can learn more by downloading information from www medicare.gov , or you can order a $5 brochure from the Patient Assistance Network (202-595-1038).

    A little comparison shopping can also help cut drug costs. A Consumer Reports newsletter found that pharmacy prices for a 90-day supply of pills can vary $30 or more. If you decide to order drugs online from U.S. pharmacies, look for the Verified Internet Pharmacy Practice Sites (VIPPS) logo. The VIPPS seal of approval means the site has been vetted by the National Association of Boards of Pharmacy.

    These are stopgap measures, of course, and no substitute for legislative relief. But the higher drug prices climb, the better such measures pay off.

    Questions for Christine? Send e-mail to gorman@time.com