The Journal Editorial Report . Elections . November 12, 2004 | PBS
Visit Your Local PBS Station PBS Home PBS Home Programs A-Z TV Schedules Watch Video Donate Shop PBS Search PBS
The Journal Editorial Report
Front Page
Lead Story
Briefing & Opinion
Tony & Tacky
TV Schedule
For Teachers
About the Series

Briefing and Opinion
November 12, 2004

Rx: Drug Reimportation
Lisa Rudolph at Pfizer

In response to high medicine prices, some cities, counties, states, and millions of Americans are defying the federal government by importing cheaper prescription drugs. The latest and most ambitious plan has just begun in Illinois. Our report is from correspondent Lisa Rudolph.


It's a familiar story: 75-year-old Gaylee Andrews and her husband Ray counting pennies as carefully as their pills. Medication that adds up to $800 dollars a month their insurance doesn't cover. So a decade past retirement age, each is working more than 30 hours a week just to pay for her medicine.

"We have to take the medication in order to go to work to pay for the medication," says Andrews. "So we're in a vicious cycle."

Dr. Gaylee and Ray Andrews
The Andrews' hard-earned savings of 250-thousand dollars is now gone. This is not how they imagined spending their golden years. "One day she asked if we were going to have enough money this week so she could get her medicine that she hasn't had for a month because there was no money left in the budget which made me feel like a heel," says Ray Andrews.

I-Save Rx In Illinois, the state government hopes to help the Andrews and nearly three million uninsured residents like them with the new I-Save Rx program. The program makes more than 100 medications available at cheaper rates, sometimes at half the U.S. price. It is done through a network of state-approved and state-inspected foreign pharmacies in Canada, the U.K. and Ireland, where there are price controls that limit how much drug companies can charge.

It's not just Illinois. What started out as grassroots rallies and bus runs of seniors over the border now has a dozen states plus scattered cities and counties with similar re-importation plans in effect or in the works. So why isn't the FDA -- which claims imported medication could be counterfeit, or unsafe -- cracking down?

William Hubbard of the FDA suggests that it may be necessary to go to court at some point, but not immediately. "It's all a matter of degree," he says. "There's not a huge safety problem today, but we do see a degradation in the overall safety of the drug supply." William Hubbard

Hard evidence or numbers are difficult to come by says Hubbard, because he fears many injuries are not reported. "People are not telling anyone they're buying these drugs. So we worry injuries that could be occurring are not being tracked. And in fact, the Illinois website makes you sign a disclaimer that if you're injured it's your problem and not the states problem."

Rahm Emanuel, Illinois Congressman and sponsor of the Rx program, says that the U.S. is the only country where the government isn't doing what it should be doing on behalf of its citizens. He disagrees that it opens up bigger risks for residents who choose to purchase drugs through the program.

Rahm Emanuel
"I'm willing to take the risk as long as every other politician who's decided not to allow choice competition, takes the risk for every senior who misses their medications, for every senior who cuts their pills in half," says Emanuel.

How big a risk are imported prescription drugs? Many of the drugs Americans buy here are in fact made overseas by American companies. Pfizer, for example, has 60 manufacturing sites in 32 countries. It's enormously profitable anti-cholesterol drug Lipitor is mostly made in Ireland.

"They want to move a plant to Ireland for labor reasons or some other type of reasons -- cheaper prices, cheaper manufacturing capability -- they can do that," says Emanuel. "But, when we want to import the same medications from the Canadian market or from the U.K. market where the prices are 50 percent cheaper, hold on. The free market shouldn't work that way."

Peter Corr

Although imports are only a fraction of the 200 billion dollar pharmaceutical industry, U.S. companies are fighting to cut off overseas suppliers. Dr. Peter Corr, Pfizer's senior vice president for science and technology, says his company is trying to protect its profits -- not to make more money -- but to spend more on research and development.

The company is making a profit in Canada. When asked why not make less of a profit here in the U.S., Dr. Corr responds that a vibrant R&D research organization is the best way to make innovations widely available. "If you bring price controls into the U.S., you will damage innovation significantly," says Corr. "I believe that."

Dr. Jerry Avorn, author of the book POWERFUL MEDICINES: THE BENEFITS, RISKS AND COSTS OF PRESCRIPTION DRUGS, says that the cost of drug discovery should not be borne by the elderly and poor who can't afford their medication.
Jerry Avorn

Avorn, a pharmacology expert at Harvard Medical School and Boston's Brigham and Women's Hospital, says that this is not a safety or a scientific issue. "This is an economic issue about the drug companies' needs. The FDA is under considerable political pressure -- from the administration, from Congress, to not encourage or even allow this kind of importation because it's a big economic threat to the drug industry."

Lawmakers are set to reconsider legislation that would lift the federal ban on importing medication. But with American demand dwarfing overseas supply, even supporters concede, reimportation is a short-term solution at best.

list of medications
"We will eventually need to come to a healthier solution than just trying to shop something in from Toronto or Great Britain," says Avorn. "It may be that the most important legacy of the importation debate is that it's going to get people to focus on why are our drug prices so high. What's going on here?"