How imported drugs would change US Pharmacy business?
Today I read in Business Wire about orderonlinedrugs.com with a tag line "Your #1 Online Canadian Pharmacy". The orderonlinedrugs.com is claiming that it can save on the prescription drugs up to 80% compared to prices in the US. Orderolinedrugs.com is slightly different from other online pharmacies as it claims to be transparent in where the prescriptions are filled (Abbotsford, BC, Canada) and fully licensed pharmacy part of the Rexall group. Orderonlinedrugs.com is one of the many such online pharmacies operating outside US however targeting US consumers. What if importing of prescriptions drugs are allowed in US?
You might be aware of the famous PharmacyChecker.com who collects, evaluates and reports credentials, prices and customer feedback regarding online and mail order pharmacies. Pharmacychecker.com has been in operation for years now and many of the people living in US are very well aware of them as it is the place to go for comparing drug prices. Today's comparison shows unit price of Lipitor Brand Drug (10 mg) is selling for around $1.60 by multiple online pharmacies who are in Canada, Turkey, New Zealand, Israel, etc whereas costco.com is selling the same branded drug for a unit price of $2.90 that explains the up to 80% savings claim by orderonlinedrug.com. By the way, orderonlinedrug.com is also a verified member of PharmacyChecker.com from today.
I couldn’t resist my urge to click and check the orderonlinedrug.com. Reasonably a simple online pharmacy site with no major bells and whistles with simple prescription drug search feature. Our popular Lipitor 10mg unit price is $1.15 for 90 pills package. My next attention went to the Mr. Obama picture in the Daily Medical News section claiming that Obama supports Canadian Pharmacies. Very intelligently used Obama for the marketing, well done by orderonlinedrugs.com. The last thing which caught my eyes is that the disclaimer in the bottom which says FDA's general position: The FDA, due to the current state of their regulations, has taken the position that virtually all shipments of prescription drugs imported from a Canadian pharmacy by a U.S. consumer will violate the law.
Few months ago (June 2009), a bill was introduced in US Senate S.1232 : A bill to amend the Federal Food, Drug, and Cosmetic Act with respect to the importation of prescription drugs, and for other purposes. This bill is yet to be passed. This bill allows importation of qualifying drugs from registered importers. This should significantly reduce the cost of prescription drugs.
How this bill would change the pharmacy business?Globalization - Pharmacy bellwethers CVS, Wal-Mart, Walgreens, Rite Aid, etc will start opening prescription filling locations in Mexico, Brazil, Canada, etc and sell imported drugs.
Price War - We may see $1 prescription program
Labeling - Imported drug in US market needs to have a prominent label to differentiate them from foreign imported drugs which will be huge initiative for business and IT
Online - Will the online pharmacies like orderonlinedrugs.com survive if the US pharmacy bellwethers get this bill S.1232 passed?
What are your thoughts?
Comments
Yes you are right Ezhil, if this bill is passed, then it would sound the death knell for all the non US based online pharmacies, as people would be able to buy cheaper drugs through known names like Wal mart. I don't think that the non US origin label, is going to deter the customers, at least for higher end drugs.
But what I am surprsied is, with all the commotion of health bill trillion dollar tag, why is the pharmacy retail industry not clamouring for getting this bill passed, by lobbying for this bill, or why has the US govt allowed the pharmaceutical indutry to charge exorbitant rates so far.
Posted by: Punit | December 12, 2009 8:45 PM
All your questions depends on one word "Liability". Who is going to pay for medical liability insurance premium and what will the risk premium for such insurance. Currently every pharmacist has their own liability insurance in US in addition to CVS company liability insurance. So the direction this is going to take is based on Lawyers not patient, providers (pharmacy, physicians, hospitals) or payers ( insurance company)
Posted by: ash ahamed | December 13, 2009 6:47 AM
Ahamed you are noticing about the liability here but what about the assets as this will improve the customer satisfaction. Lawyers to a certain extent will benefit but you are looking only the few droplets but there is an ocean to be searched for. this will lead to new opportunities especially in India as it is becoming the hub for mass production f these drugs and the companies will fight for their pie which in turn will ensure the quality as the manufacturer will be the same
Posted by: vikas | December 21, 2009 5:10 AM