I’m glad that the Senate voted for, before they voted against, a prescription drug (re)importation bill. The votes on this issue show that when it comes to reimportation and importation of drugs from abroad, it’s hard to know where is the politically viable place to stand.
Those that initially voted in favor of the bill to allow importation (and reimportation) of prescription drugs from the price-controlled countries of Canada, Australia, Europe, Japan and New Zealand, wanted to appease citizens who don’t like paying for higher-priced drugs. Many of the same representatives then turned around and voted on an amendment that empowers the administration “to certify the safety and effectiveness of imported drugs before they can be imported,” essentially assuring that no prescription drugs would be imported from these countries into America.
Politically, representatives’ records will show that they’re in favor of lowering the cost of drugs by borrowing from another country’s subsidized cache; but practically, they’re standing firmly on the safe side, favoring efficacy, intellectual property rights, and economics.
Here’s why practicality beat out politics:
Efficacy. Despite the fact that a safeguard was built into the bill to allow for tracking of prescription drugs being imported and that the FDA would be charged with certifying these drugs (at a HUGE cost), there’s still no way to be sure that what you’re ordering is what you’re swallowing. Not only would this be an increase in government policing of choice, it also leaves people thinking that because the drug is in America, it must be safe to use, which would never be the case.
Intellectual Property. Importation and reimportation does not address ownership of the prescription drug. Some countries, like Canada, when attempting to buy drugs for its citizens, can reject the purchase price suggested by a drug manufacturer if it’s too high and instead create a generic at home without paying licensing fees. Opening boarders without addressing world intellectual property rights just messes with …
Economics. Currently, different markets offer different opportunities to drug manufacturers. Willingness-to-pay determines the price set on drugs. Countries with subsidized drugs offer a lower price. Drug manufacturers take this lower price because they’re trying to gain as much consumer surplus as they can. Getting rid of this option will have the effect of lowering the price American’s pay but also raising the price that other countries pay — which may have disastrous effects on their fragile, price-controlled health care systems.
This doesn’t mean that (re)importation shouldn’t happen. It should, just not in the way suggested by the Senate. There needs to be a free-market solution that correctly harnesses incentives and addresses the pitfalls of above.
