Canadians Against Reimportation


At the dawn of the debate over letting Americans buy drugs from Canada, some fair-weather free-traders opposed the imports. I took the other side of the fight, arguing that

No one's forcing the drug companies to sell their products in Canada. If the market price for pharmaceuticals really is closer to what Americans pay than to what Canadians pay, freer trade is as likely to undermine Canadian policy as it is to, in the words of Cato's Doug Bandow, "import foreign regulatory regimes."

We rejoin the story three and a half years later, with a report in The Globe and Mail:

Canada's pharmacists have asked the federal government to ban the export of prescription drugs to the United States following the introduction of a bill in the U.S. Congress that would open the door to medicines intended for Canadians….

Because of domestic controls, pharmaceutical companies offer prescription drugs to Canadians at prices below those charged to Americans—but they restrict the supply to what is needed in Canada. There is concern that bulk export of the cheaper drugs to the U.S. market will provoke the drug manufacturers to argue for an end to that pricing agreement.

That said, it's entirely possible that the law will neither bring drug shortages to the United States nor undermine price controls in Canada:

[B]ecause the vast majority of Americans have prescription-drug insurance coverage, "it is expected that only a very small additional percentage of U.S. customers would start to order their drugs internationally should this bill become law," wrote [Canadian International Pharmacy Association general manager Gord] Haugh, who has previously worked in [Health Minister Tony] Clement's office.