Technology & Science

Prescription drugs: more business for Canadian online pharmacies?

The FDA says there's nothing wrong with buying online, as long as the website is located in the United States, is licensed by the state board of pharmacy where the site is operating, has a licensed pharmacist on hand to answer your questions and requires a prescription from a doctor who is licensed to practice in the United States.

The U.S. Food and Drug Administration still says "don't do it." The "it" being buying prescription drugs from Canadian — or any other foreign — online pharmacy.

The official line is that if you're an American buying drugs online, you could be paying for:

  • Counterfeit drugs.
  • Medicine that's too strong or too weak.
  • Drugs made in unsafe conditions.
  • Drugs that are beyond their best-before date.
The FDA says there's nothing wrong with buying online, as long as the website is located in the United 
States, is licensed by the state board of pharmacy where the site is operating, has a licensed pharmacist on hand to answer your questions and requires a prescription from a doctor who is licensed to practice in the United States.

But those guidelines didn't stop Americans from flooding Canadian online pharmacies with orders in the early years of the 21st century.

At its peak, the trade was estimated to have been worth more than $1 billion US annually. The FDA estimated that Americans were buying more than two million packages of prescription drugs a year from foreign sources.

But several factors began to erode the benefits to Americans of buying from Canadian online pharmacies. In 2006, changes to the U.S. Medicare plan subsidized the cost of prescription drugs for some people with Medicare coverage. It made drugs cheaper for a lot of people.

A rapidly rising Canadian dollar also narrowed some of the price differences between drugs in the two countries.

Business tailed off for Canadian online pharmacies — but it didn't disappear. And there are hints that the business may be about to pick up again.

U.S. President Barack Obama's record $3.55 trillion US budget unveiled on Feb. 26, 2009, included a reference to supporting "the Food and Drug Administration's new efforts to allow Americans to buy safe and effective drugs from other countries."

Couple that with a Canadian dollar that has fallen by 20 per cent over the past six months, and you might have a recipe for an increase in business for Canadian online pharmacies.

Why are drugs cheaper in Canada?

Aside from the exchange rate, price controls is the key factor that keeps the cost of brand-name drugs lower in Canada than in the United States.

The Patented Medicine Prices Review Board, a quasi-judicial body of the government created in 1987, reviews pharmaceutical prices and enacts caps for patented drugs and medicines.

Another factor may be direct to consumer advertising. Only the United States and New Zealand allow drug companies to advertize their products directly to consumers. Critics of the practice say it drives people to higher-priced brand-name drugs when lower-cost generics are available. They also say the drug companies recoup their advertising expenses through higher drug prices.

The Pharmaceutical Research and Manufacturers of America — an organization representing the major pharmaceutical and biotechnology companies in the United States — says drug companies spent $4.8 billion US on direct-to-consumer advertising in 2006. The group says that's just a fraction of what the companies spend on research and development, so any effect on prices is minimal.

However, not all drugs are cheaper in Canada. Once a patent expires, other companies are free to make generic versions of brand-name drugs. For instance, if you're being treated for depression, you might be prescribed Paxil — or its generic equivalent Paroxetine. While generics are cheaper than brand name drugs in Canada; in the United States, they are often cheaper still.

The table below includes prices for several drugs at a Canadian online pharmacy and at an American one. Where a generic version of a drug is available, it is included in the comparison. All prices are in U.S. dollars.

 Drug QTY CanadaDrugs.com DrugStore.com (U.S.) Savings if buying from Canada
Lipitor 10 mg(cholesterol treatment) 90 $188.51 $255.97$67.46
Nitro-Dur patch 0.8 mg(angina treatment) 90 $125.73 $303.50 $177.77
Paxil 20 mg(depression treatment) 100

$220.50

$112.50 for 90 tabs of generic Paroxetine

$319.65

$28.97 for 90 tabs of generic Paroxetine

$99.15

-$83.53 

Tamoxifen Nolvadex 10 mg(breast cancer treatment)180 Tamoxifen Nolvadex no longer available: Generic version Tamoxifen Citrate $93.00

$328.99

Generic version Tamoxifen Citrate $49.95 

$235.99

-$43.05 

Zoloft 100mg(depression treatment)   100

$210.82

Generic Sertraline HCl $115 (100)

$317.61 (90)

Generic Sertraline HCl $29.97 (90)

$106.79

-$67.68 

Zocor 20 mg(cholesterol treatment)  112

$319.08

Generic Simvastatin  $97.65 (90)

$404.96

Generic Simvastatin $73.97 (90)

$85.88

-$23.68

Details on how Americans will be encouraged to seek out cheaper drugs are expected to be known sometime in April 2009. But Canada may not be the only country to benefit. India has also entered the online pharmacy game.

One Indian pharmacy — InternationalDrugMart.com — takes direct aim at the American market. However, it mainly carries generic versions of drugs. Some of those prices are higher than Canadian prices, and they're much higher than American generic prices.

Who cares?

There are concerns on both sides of the border about online pharmacies. Some question the ethics of Canadian doctors who are willing to write prescriptions for U.S. patients they've never examined. Meanwhile, others are concerned Canadians could face supply shortages, lower quality service and risk losing federally regulated prices as pharmacists try to cater to the U.S. market.