Canuck Conundrum

Wild Bill Safire addresses the problem of Americans buying prescription drugs north of the border. "[T]his foolish acceptance of foreign price controls means that the U.S. consumer is subsidizing the foreign consumer. Not being dopes, pursuing their economic interest, American bargain-hunters are now buying these drugs where they are sold cheaply—:outside the U.S." His proposals:

The tough-minded approach: Raise overseas sales prices to include the cost of research (which should lower prices here somewhat). If the Canadian government says no, let Canadians who want our products buy direct from the U.S. via Internet or mail at the price that pays for research, as Americans do. If Canada forbids that, let its legislators answer to citizens who want prescriptions filled.

The tenderhearted approach: Our drug companies can accurately estimate the current Canadian-only prescription demand in Canada or elsewhere. They should restrict supply of those products at low prices to that level. When American purchasers compete with Canadians for that limited supply, price controls will come under pressure. Canada can then impose rationing, always unpopular in peacetime; or tolerate black markets; or lift its controls until U.S. bargain-hunters see no purpose in competing with Canadian buyers.