Answering the question, Should those companies be patronized? requires the purchaser to pay some attention to the law of the land. That law says you must not buy drugs abroad. But exegesis on the law goes on all the time, and there are court rulings, for instance, in West Virginia, which manage to authorize such purchases (by not prosecuting offenders), while, in Oklahoma, there is evidence of an itch to uphold the law. Meanwhile, the head of the Food and Drug Administration, Dr. Mark McClellan, stresses his concern for safety. He is not trenchant on the economic question, which is what most purchasers are interested in.
(l) The producer of a patented product is entitled to charge what it wishes to charge for that product, for as long as the patent is in force.
(2) The government is legitimately entitled, by law and public sanction, to regulate the sale of the product by ascertaining its safety.
(3) If the government is a heavy purchaser of the product, it is entitled to bargain for lower prices than the producer would otherwise set.
(4) If we subscribe, as free societies are supposed to do, to free trade, the consumer is entitled to search out sellers of the product who are willing to make it available cheaper than one can get it at home.
(5) The producer is entitled to vary the price of its product to other countries according to myriad considerations, for instance, the ability to pay.
Enter Canadian pharmaceutical merchandisers. They get the product cheaper than U.S. individual consumers by buying it in bulk and pretending that their orders are intended for local consumption. "Pretending," because they don't sign a legal agreement limiting sales to neighbors. If the Canada TrustRx Pharmacy, which is very much alive, moves over the period of a couple of years from ordering 100,000 Lipitor tablets to ordering 1 million Lipitor tablets, the producer is not likely to complain.
Who are complaining are the FDA, which says it is worried that foreign-shipped drugs may be counterfeits, or may be impure, and therefore dangerous to health; U.S. pharmacies, who stand to lose business from the competition; and fussy prosecutors who say the law is the law and people are stepping on it all over.
Who are not complaining are an increasing number of purchasers who feel the relief not only from the drugs they consume, but from the lightened drain on their wallets. Peter Jennings of ABC cited a 64-year-old nun who is taking three medications to treat high cholesterol, gout and thyroid. "I have no health insurance. I only make $15,000 a year, and I can't spend it all on medicines. Last year, I spent $1,068 on three drugs, Lipitor, Allopurinol and Synthroid. This year I'll be spending about $640. The savings are amazing."
Her attitude on the law? "You know what? When the laws are unjust, I really don't care." The FDA's attitude? "A spokesman," Mr. Jennings reports, "says the FDA looks the other way and does not enforce (the laws). 'We don't want to punish seniors,' he said."
Those who believe in the market welcome the maneuvers of the consumer. The consumer, Milton Friedman wrote years ago, is king, and should be king. The producer -- of medicines or bicycles or books -- can charge what he wishes. The consumer can grope for relief, and has found some relief in Canada.
The listless player in the field is the U.S. health insurers. These tell us with some frequency that we must buy generic drugs where they are available, to avoid the higher cost of brand-name drugs. Why aren't they telling us that we should buy drugs in Canada? This would reduce the overhead for the health insurers, as also for the government, which marginally protects the straitened old and ill.