Import prescription drugs😏

Total savings to drug buyers from legalized commercial importation would be one to two percent of total drug spending and much less than international price comparisons might suggest. The savings going directly to individuals would be less than one percent of total spending. Most of the savings would likely go to third party payers, such as insurance companies and HMOs.💊

Statement of 

Richard H. Carmona, M.D., M.P.H., F.A.C.S. Surgeon General
U.S. Public Health Service
U.S. Department of Health and Human Services Wednesday, January 26, 2005

💊 This, of course, would be reflected in premiums. 

And another study:

Commercial Importation of
Prescription Drugs in the United States:
Short-Run Implications

Patricia M. Danzon
University of Pennsylvania
– Scott J. Johnson  -Genia Long Analysis Group
-Michael F. Furukawa
Arizona State University April 2011

The option of legalizing the commercial importation of prescription drugs is of continued policy interest as a way to reduce U.S. drug spending. Using IMS data, we estimate potential savings from commercial drug importation under assumptions about percentage of drugs likely to attract imports; potential supply from foreign countries; and share of savings passed on to payers. 

Our base case estimate is that $1.7 billion per year, or 0.6 percent of total drug spending, would be saved by payers; sensitivity analyses range from 0.2 to 2.5 percent under plausible assumptions and up to 17.4 percent under unrealistic assumptions about unlimited foreign supply, costless trade, and zero profits for intermediaries. 

Estimated savings to payers are less than the average price differentials between the United States and foreign countries because proposed legislation exempts certain drugs from importation; foreign markets are small relative to the United States; regulatory and other constraints may limit the volume of exports; trade is costly; and intermediaries will retain some savings. 

Although savings to U.S. payers/consumers would likely be small and have minimal impact on total U.S. health care spending, costs to other countries could be significant, due to reduced access and possibly higher prices. In the long run, reduced investment in R&D could adversely affect consumers globally.
The US subsidizes the rest of the world, the US generates most of the new drugs in the world. European governments fix the price of drugs so they are not paying their full share of developmental costs and if drug companies don’t comply, they are penalized or can’t sell their drugs. 


Categories: Government, Healthcare

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3 replies »

  1. I am not sure what this study is defending. One drug that I take would cost 80% less if I imported it from Canada saving $8,000 year. True I do not pay that out of my pocket, but my employer would save that money. That is real money that somebody would save and it could be me if I lose that benefit and later Medicare will pay for part of that drug, read the US taxpayer.

    Second, I don’t care if other countries drug costs go up. The statement even says they the US subsidizes the rest of the world for R&D. About time they pay their share.

    Third, the drug may be already imported. I have not been able to find out exactly where it is manufactured but the drug company is British, not American therefore the profits go back to the UK. If you put America first, why is this money not staying in the USA?

    I think real savings will come only after tort reform and opening up the importation of drugs. I also understand the FDA concern of poorly manufactured drugs. In China they are willing to kill babies and pets will harmful chemicals just to make a buck or a yen.


    • I think the point is that the price would not be that much different if importing was allowed. Prices would adjust and or R&D would be cut.


      • I finally got a pill bottle where the original label was not covered over by the pharmacy label. My expensive drug is a “Product of Denmark”. So I guess I am paying America rates for an imported drug anyway.


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