View From a Height
Commentary from the Mile High City
Tuesday, March 09, 2004

Drug Reimportation 

Slumming over at NPR on the way in this morning, I heard the capsule report of yesterday's Senate hearings on the Administration's choice to head the FDA, "the agency which oversees Medicare and Medicaid," never mind making sure that what we put into our mouths and nurses put into our veins won't kill us.


Aside from letting us know what NPR's priorities are, the report emphasized the depressing news that the Administration has chosen to fight drug re-importation on a safety rather than an economic basis. When Minnesota Gov. Tim Pawlenty was on Hugh Hewitt's show during the Minnesota State Fair, he defended this idea by claiming reliance of the free market, therefore on free trade. This is perhaps one of the most intellectually dishonest claims I've heard made on this issue, since Canada tightly controls its drug prices, and hardly constitutes a free market.


Canada is already concerned that we'll buy up all their prescription drugs at their bargain rates. But the net effect wil be to drive down prices here to reflect Canada's socialist pricing policies. Drugs won't be more available, they'll be less available. And our own research and development will also begin to resemble that of Canada. Who right now, has to import drugs from us.


There's really no way out of this scenario. Drug reimportation tries to create a unified market with disparate regulation. Companies won't seek to answer the resulting shortages with greatly increased production, since their profit margins will have shriveled. Canada might try to keep drugs from leaving the country, in effect defeating our re-importation, creating a black market, and re-creating the situation we have today. Consumers here, having tasted lower prices for a while, may begin to agitate for price controls here, making shortages permanent.




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