Canadian pharmacies see decline in U.S. business
Last Updated: Wednesday, July 4, 2007 | 9:47 AM CT
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The soaring Canadian dollar and changes to the U.S. Medicare system have a senior's group south of the border calling off prescription drug-buying excursions to Manitoba.
The Minneapolis Senior Federation has organized between 30 and 40 bus trips to Winnipeg over the last decade so members can get their prescriptions filled at less expensive Canadian prices.
But with the Canadian dollar above the 94-cent US mark — its highest value in almost 30 years — American customers find their dollar doesn't go as far as it used to in Canadian pharmacies.
Federation officials also used cross-border shopping to encourage the U.S. government to change drug laws. A new U.S. drug benefit plan, Medicare Part D, now gives people with Medicare coverage prescription drug benefits the way an insurance plan would, though patients must still pay deductibles and premiums to opt into the plan.
Gord Haugh with the Canadian International Pharmacy Association says Americans are still buying in Canada, but only about half as much as they used to.
"The wide price advantage is not there anymore. Nevertheless, there still is significant price advantage on some of the more popular drugs, and so we still see the seniors buying," he said.
"That being said, the market has probably shrunk from about $900 million down to, at the current time, around $500 million."
As busloads of seniors get their drugs elsewhere, the number of online and mail-order pharmacies in Manitoba is also dwindling, Haugh says.
Manitoba was once home to most of the estimated 50 to 60 internet pharmacies across Canada. The province now has only about 11, he says, noting many have been forced out of the market or bought out by larger players.
Haugh thinks there is still room for the industry to grow again — but he doubts it will return to its heyday unless there are new changes to U.S. legislation.
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