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Why We Pay So Much For Drugs

How the clamor for cheap Canadian imports is heating up the 2004 campaign and giving Washington a headache


Posted Sunday, Jan. 25, 2004

Helen Clark of Kennebunk, Maine, is a smuggler of sorts. At 77, the retired registered nurse doesn't look the part. She still does volunteer work—administering flu shots, cutting toenails and organizing blood drives—at the Southern Maine Medical Center, where she worked for more than four decades, first in the maternity ward and later in the operating room.
Clark is a model of frugality as well. She and her husband Dorrance raised 10 children on modest salaries. When he developed lung cancer in 1991, she stopped working to care for him until he died. She has lived in the same house since she was 1 year old. She seldom buys anything for herself, reuses already reused sewing material and carefully budgets her food money. "You plan out what you can afford," she says.

What has turned Clark into a renegade bargain hunter is the price of her medications. Like many other elderly people, she takes multiple prescription drugs for several conditions, including high blood pressure, elevated cholesterol and glaucoma. To make the money stretch, she joins other seniors in her state on overnight bus trips to St. Stephen, N.B., just across the border from Calais, Maine. On average, name-brand prescription drugs in Canada cost an estimated 40% less than they do in the U.S. On a trip last November, Clark did even better than that, buying a six-month supply of medications for a little more than $1,000, a cache that she estimates would have cost about $3,000 in Maine for the same drugs. One of them is Lipitor, the expensive, heavily marketed cholesterol-lowering drug developed by Pfizer. "Lipitor is my biggest savings," Clark says. "For a six-month supply, it's $1,900 in the U.S. I paid $500 [in Canada]." At U.S. prices, she couldn't afford her total drug bill and would have to pick and choose which conditions to treat.

Yet what Clark and others are doing is technically illegal, since the U.S. forbids the import of prescription drugs by anyone other than the original U.S. manufacturer, and even then only when the drugs meet all the approval requirements of the U.S. Food and Drug Administration (FDA). The FDA contends it is looking out for consumer safety, but in fact a growing volume of prescription drugs sold in the U.S. is made overseas and brought in by domestic manufacturers. What's really being protected, critics say, is the pharmaceutical industry. It has a powerful partner in the FDA, which over the past year has conducted widely publicized seizures of prescription drugs shipped into the U.S. from Canada, Mexico and elsewhere that it maintains could be harmful to consumers. The most recent disclosure came last week, when the FDA revealed a blitz inspection of medicine being imported from Canada that turned up five packages of an asthma medication, Serevent, that had been recalled in Canada because of a manufacturing defect.

While there is no doubt that counterfeit and adulterated medicines—some potentially injurious, possibly even lethal—are sold over the Internet by unscrupulous vendors, a TIME investigation suggests the FDA's actions against Canadian imports have been part of a concerted campaign to simultaneously discredit its counterpart agency in Canada, provoke fear among American consumers who buy their drugs there, blunt an exploding political movement among local and state governments to begin wholesale drug buys in Canada and ultimately preserve the inflated prices charged U.S. consumers and taxpayers.


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