Monday, May 31, 2004
Drug importation offers few savings, big liabilities for states
[Grace-Marie Turner and Conrad Meier, "Prescription Drug Importation: Just the Facts," Health Care News, The Heartland Institute, 1 June 2004.]
State policymakers faced with rising drug costs and mounting political pressure to engage in drug reimportation from Canada prior to federal approval should be aware that such a move may create more headaches than it solves:
- The commission that administers health insurance for state employees and retirees in Massachusetts found the state would save $10.4 million a year by purchasing lower-cost prescription drugs from Canada. But the commission recommended against moving forward with the plan, saying the savings would shrink to $1.4 million after waivers of copayments to incentivize participation by employees and loss of drug company rebates. And, the commission said, even the $1.4 million potential savings would not be worth the liability risks.
- "It is likely that the intended cost savings for consumers would be absorbed by fees charged by exporters, pharmacists, wholesalers, and testing labs," according to FDA Commissioner Lester M. Crawford.
- Borderless drug stores, including those in Canada, require consumers to sign waivers that hold the seller harmless from any legal responsibility for the quality or effectiveness of the drugs sold. States that promote illegal drug importation programs, such as Minnesota and Wisconsin, say on their Web sites that they expressly disclaim "any and all liability from such importation or reimportation or the use of any products so acquired." The reason is obvious: There is no realistic way to verify the safety of these drugs imported through Canada and other countries.
- "The bottom line is that [the state] will benefit by putting the drugs in the 'stream of commerce' and therefore must also bear the risk of loss if these drugs result in injuries," wrote Shikha Dalmia for Tech Central Station. The Illinois Supreme Court has recognized that "when a city creates a hazardous condition and someone is injured as a consequence, it must respond in damages, just as others are required to do."
[Grace-Marie Turner and Conrad Meier, "Prescription Drug Importation: Just the Facts," Health Care News, The Heartland Institute, 1 June 2004.]
State policymakers faced with rising drug costs and mounting political pressure to engage in drug reimportation from Canada prior to federal approval should be aware that such a move may create more headaches than it solves:
- The commission that administers health insurance for state employees and retirees in Massachusetts found the state would save $10.4 million a year by purchasing lower-cost prescription drugs from Canada. But the commission recommended against moving forward with the plan, saying the savings would shrink to $1.4 million after waivers of copayments to incentivize participation by employees and loss of drug company rebates. And, the commission said, even the $1.4 million potential savings would not be worth the liability risks.
- "It is likely that the intended cost savings for consumers would be absorbed by fees charged by exporters, pharmacists, wholesalers, and testing labs," according to FDA Commissioner Lester M. Crawford.
- Borderless drug stores, including those in Canada, require consumers to sign waivers that hold the seller harmless from any legal responsibility for the quality or effectiveness of the drugs sold. States that promote illegal drug importation programs, such as Minnesota and Wisconsin, say on their Web sites that they expressly disclaim "any and all liability from such importation or reimportation or the use of any products so acquired." The reason is obvious: There is no realistic way to verify the safety of these drugs imported through Canada and other countries.
- "The bottom line is that [the state] will benefit by putting the drugs in the 'stream of commerce' and therefore must also bear the risk of loss if these drugs result in injuries," wrote Shikha Dalmia for Tech Central Station. The Illinois Supreme Court has recognized that "when a city creates a hazardous condition and someone is injured as a consequence, it must respond in damages, just as others are required to do."
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