Illinois seeks overseas Internet drug network

Illinois Governor Rod Blagojevich is seeking to break Big Pharma's ironclad grip on US drug prices by establishing an online network to provide residents with access to distributors in Canada, Ireland and the UK, the Associated Press reports.

The scheme, which may be up and running within a month's time, will enable Illinois residents to price-shop against the US pharmaceutical industry, which has enjoyed decades of regulatory isolation, and almost total impunity in overcharging Americans for their drugs.

US regulators are already lining up on behalf of the industry, obediently criticizing the move as a reckless threat to the health and safety of the American public (as if usurious pricing, forcing the poor to choose between drugs and other necessities, and even to underdose themselves to make ends meet, weren't a major public-health threat in itself).

"The drugs that would be accessed from this program would be illegal, and we would have serious concerns because the drugs wouldn't be regulated by an American health authority," U.S. Food and Drug Administration (FDA) Associate Commissioner for Policy and Planning William Hubbard warned Tuesday.

The FDA, and major pharmaceutical industry lobbying outfits, have long been fearmongering about the dangers of buying their drugs from abroad. Ironically, the major American companies operate quite a few manufacturing plants in several foreign nations, so by raising this safety issue, they are, in a sense, admitting that they can't be trusted not to poison us without FDA oversight. Which is quite a PR conundrum, when you get to thinking about it.

While it's true that Internet drugs shopping can put consumers at risk of buying counterfeit drugs from fraudulent outfits, it can also put them in touch with many legitimate overseas distributors able to undercut US pharmacies by quite a margin. The idea behind the Illinois initiative, like a similar one in Wisconsin, is to weed out the frauds, and provide access to reputable Internet outlets for overseas drugs.

Because the sites will be vetted, the suggestion that this is any more dangerous than a brick-and-mortar transaction is ludicrous. The companies complaining about drug safety are often the very manufacturers of the supposed inferior products being sold. In other cases, drugs are made overseas by foreign companies, with FDA approval, and distributed by US companies.

A chink in the wall

The growing popularity of both inexpensive foreign drugs, and the Internet as a shopping Mecca for them, have given Big Pharma fits.

This is because in most developed nations, there is at least some sort of national health service, making government a huge buyer with enormous power to negotiate and even mandate prices. Since the USA doesn't participate in any of this Commie nonsense, and since the FDA must, by law, regulate all drugs sold in the USA, all pharmaceutical companies enjoy a protected market of captive buyers who might now liberate themselves via the Internet.

When Congress created the Food, Drug, and Cosmetic (FD&C )Act of 1938, mandating for the first time that drugs be proven safe and effective, the pharmaceutical industry was quite displeased. However, in time, Big Pharma came to appreciate the monopolistic potential of federal regulations that prevent outsiders from distributing drugs without going through the same channels.

The Act doesn't outlaw foreign-made drugs, certainly; but it does mandate that foreign drugs go through the US regulatory and distribution apparatus. Because they can't 'cut out the middle man,' so to speak, foreign companies have no incentive to discount drugs distributed in the USA. They're stuck with the same regulatory overhead as native companies, and price their products accordingly.

So the issue here is not one of foreign manufacturing; American drugs made in Canada or Britain or Ireland are the same as those made in the USA, only cheaper. The problem is one of distribution, with the Internet making it possible for American consumers to 'buy overseas' in a virtual sense, and so denying Big Pharma a rich source of income from distribution deals with foreign makers.

The Internet has become a chink in Big Pharma's wall of protectionism, and it's no wonder that companies, lobbyists, and regulators alike have turned to scare mongering. Cutting back on overseas production is another tactic that the industry is using.

"We've seen the pharmaceutical companies start to limit supplies in Canada, and try to shut off that option for consumers. We recognize that Canada alone can't be relied upon to provide affordable drugs for Illinois," Blagojevich's spokeswoman, Abby Ottenhoff, observed. This is one reason why British and Irish pharmacies will be included in the Illinois online network.

Perhaps one measure of a thing's value to consumers is the vehemence of opposition it attracts from big business interests. In this case, it seems that Internet shopping has finally proved itself useful and valuable. Will wonders never cease? ®

Thomas C Greene is the author of Computer Security for the Home and Small Office, a comprehensive guide to system hardening, malware protection, online anonymity, encryption, and data hygiene for Windows and Linux.

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