Drug importation is still a dangerous idea

Mike Huckabee thinks one of the worst health policy ideas “just makes sense.” The former Arkansas governor and current presidential hopeful just threw his weight behind drug importation.

His proposal isn’t new. For two decades, Congress has considered drug importation almost every year. And for good reason, lawmakers have consistently rejected it. The reason? Importation impedes vital drug research and endangers patient health.

Huckabee and others believe that importing drugs from foreign countries will reduce U.S. healthcare costs.

But prescription medicine spending barely reaches $260 billion a year — just 10 percent of our nation’s total healthcare tab. That percentage has barely budged in 50 years — and isn’t expected to for at least the next decade. By contrast, the United States will spend $13.5 trillion on hospital care alone over the next decade.

What’s more, every $1 spent on new pharmaceuticals reduces healthcare spending by $6.17.

So Huckabee’s rationale doesn’t make sense. Even if importation could lower drug prices, spending less on prescription drugs wouldn’t actually impact overall healthcare costs.

Importation would, however, reduce companies’ incentives to develop life-saving drugs in the United States.

Pharmaceutical companies spend an enormous amount of time and money developing each new drug — and most never make it to the market. Indeed, out of 5,000 medicines that go into clinical trials, just five will advance to human trials. Of those five, only one will make it to market.

The price tag for this research is staggering. According to a recent study from Tufts University, it costs $2.6 billion — and 10 years — to develop a new medicine and bring it to market. Since the 1990s, the price of drug development has increased by a whopping 145 percent.

Drug companies charge a price that will help them recoup their upfront investment costs and fund future research. Drugs cost less in Canada and countries across Europe because those governments impose price controls — and typically back those controls with an implicit threat of patent theft. So if the United States imports artificially cheap drugs, biopharmaceutical firms wouldn’t have the opportunity to recover their research and development costs. Work on the next generation of life-saving drugs would quickly grind to a halt.

That’s unacceptable. Today’s patients deserve first-class medicines and tomorrow’s patients deserve hope.

Imported drugs from Internet pharmacies in Canada, China, and India — to name only a few — are also riskier than those sold at U.S. pharmacies. Indeed, the U.S. Food and Drug Administration has said that it “cannot ensure the safety and effectiveness of products that… come from unknown sources and foreign locations.”

Counterfeit drugs are already a problem.

In 2012, the FDA warned Americans about a counterfeit version of Avastin, the cutting-edge cancer drug. In 2008, a fake version of Heparin, a blood thinner, killed 81 people. Globally, the World Health Organization estimates that 10 percent of the worldwide drug supply could be counterfeit.

Many of those drugs would come ashore if importation became legal — even if consumers limited their purchases to Canadian pharmacies. A recent study from the Government Accountability Office concluded that many pharmacies purporting to be located in Canada “are actually located elsewhere or selling drugs sourced from other countries.”

While drug importation “just makes sense” to Gov. Huckabee, it’s senseless to choke off funding for future research and endanger lives of many Americans.

Nothing contained in this blog is to be construed as necessarily reflecting the views of the Pacific Research Institute or as an attempt to thwart or aid the passage of any legislation.

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