GSK faces growing opposition to US parallel trade policy
pharmafile | October 27, 2003 | News story | |
GlaxoSmithKline is facing growing opposition from US patient groups and politicians to its attempt to block cheap drug imports from Canada.
US citizens looking for cut-price medicines have taken to ordering from Canadian Internet pharmacies who then ship supplies over the border, but GSK is the first company to publicly intervene to stop the practice, which it claims is illegal.
A number of US state health insurers have investigated the large scale importation of drugs from Canada, and are now facing a Washington-imposed budget squeeze.
FDA legal expert William Hubbard said parallel imports into the US were not technically illegal, but that it was "extremely unlikely" they could meet regulatory requirements in practice, and that the safety of the drugs could not be guaranteed.
GSK is now restricting supplies of many of its top-selling medicines to certain Canadian pharmacies, saying its motives are not purely profit-based.
"GSK estimates cross-border Internet sales of its products currently represent less than one day of its total US sales", the company said, adding that its actions were intended to protect patients from safety risks associated with the practice.
A 'Seniors' patient group from border state Minnesota is now co-ordinating a boycott of GSK's OTC products across 10 US states, and has dismissed the company argument.
"The idea that shipping drugs north to Canada is safe while shipping drugs south to the US is dangerous is ludicrous", said Barbara Kaufman, President of the Minnesota Senior Federation (Metro Region). Research by the group found GSK products were on average 52% cheaper in Canada than in Minnesota.
The group has won considerable political support, with a number of senators drafting bills to penalise companies that block parallel imports. Several state attorney generals have also threatened to bring legal action against GSK.
Senator Mark Dayton, speaking at a Minnesota Senior Federation press conference, pledged his support for a legal battle.
"Glaxo's brazen attempt to prevent Americans from obtaining lower costs medications from Canada is a textbook example of brazen abuse of monopolistic power. Glaxo is attempting to fix prices. If this isn't a classic example of anti-trust abuse, it should be. It is time for our attorney general to dust off anti-trust laws and enforce them. Teddy Roosevelt must be rolling in his grave".
The dispute has erupted against a background of growing public discontent with health insurance coverage, particularly with many older people with large drug bills, and poor people with no coverage at all.
A bill to reform the Medicare insurance system has been severely delayed by wrangling in Congress and the House of Representatives, and how much individual patients or insurance schemes will have to pay remains unclear.
GSK says progress on the new insurance system is the only way to make sure seniors have access to affordable medicines.
"Instead of being encouraged to support illegal trade and poorly regulated and potentially unsafe business practices, American seniors should be encouraged to contact their Congressional Representatives to pass a Medicare prescription drug benefit", it said.
The case will be closely watched by the industry and consumer groups, and if taken to court, could have a massive impact on the profitability of the US market, which is far and away the industry's most lucrative.
