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San Diego Union Tribune

Canadian drugs are backed by Assembly

Prescriptions would be available at a Web site

by Bill Ainsworth´┐Ż
May 27, 2004

The Assembly passed legislation yesterday aimed at slashing prices for prescription drugs for consumers and the state by tapping into the lower-cost Canadian market.

The legislation, AB 1957, overcame strong opposition from the pharmaceutical industry to win support from Democrats and a few Republicans in the Assembly on a 48-17 vote.

The bill would set up a Web site that allows Californians to shop for drugs from Canadian pharmacies certified as safe by inspectors from the state Department of Health Services.

It also would direct the Department of General Services to see which state departments might benefit from bulk purchasing of drugs from Canada. The state would need a federal waiver to purchase the drugs.

The action by the Assembly, together with the passage of similar legislation in the state Senate, gives new momentum to a nationwide effort to allow Americans to take advantage of the bulk purchasing in Canada that has lowered the cost of prescription drugs there.

Six states have already set up similar Web sites.

Strong support for these bills in the Legislature indicates that some legislation encouraging the purchase of drugs from Canada is likely to reach the governor's desk this year, legislators and their aides said.

Gov. Arnold Schwarzenegger hasn't taken a position on any of the bills that encourage buying drugs from Canada, said his spokeswoman, Ashley Snee.

But Snee said Schwarzenegger is very concerned about the cost of prescription drugs and has directed his staff to work with the Legislature and the industry to find a sensible solution.

Jerry Flanagan, a spokesman for the Foundation for Taxpayer and Consumer Rights, said the governor and his committees have received about $325,000 from the pharmaceutical industry. As a result, Schwarzenegger's decision on whether to sign some bill encouraging buying drugs from Canada will be "one of the first early tests about whether he's influenced by special-interest money."

Americans pay about 40 percent to 75 percent more for some drugs than Canadians, according to studies by consumer advocates.

"This is not a partisan issue," said Assemblyman Dario Frommer, D-Los Angeles, the author of AB 1957. "It's an issue of people getting frustrated with the high cost of drugs."

But opponents said the efforts could endanger innovation that the higher prices in America support.

"I'm disappointed. We're playing politics with the future of our health," said Stephen Chang, chief executive of Astral Therapeutics in San Diego and head of Cures, a pharmaceuticals industry group that opposes Canadian purchases.

Officials from the industry argue that importing Canadian price controls would lower profits so much that it would discourage innovation, eliminating the incentive to develop new life-saving drugs.

"Our drugs in the United States are on the cutting edge," Chang said.

Assembly Democrats argued that the cost of prescription drugs is increasing so rapidly that it forces some poor people to choose between buying their drugs and paying their bills.

Frommer said the high cost of drugs has become a drain on the state budget at a time when the state faces a multibillion-dollar deficit.

The cost of drugs in Medi-Cal, the state/federal health plan for poor people, is projected to increase by 33 percent this year, while drug costs in state prisons are expected to rise 20 percent, he said.

"We are seeing our tab for prescription drugs skyrocket," Frommer said.

But some legislators argued that Canadian drugs are unsafe, especially those purchased from unregulated pharmacies.

Assemblyman Ray Haynes, R-Murrieta, said the low cost of the drugs from Canada makes him suspicious of their quality. "You either make a lower quality drug or a less safe drug in order to be able to sell and not go out of business at the lower price," he said.

Haynes said rather than try to get lower costs for drugs for Americans by buying through Canada, the United States ought to try to get Canada to stop forcing drug companies to lower their prices. He suggested engaging in some kind of retaliation against Canadian products to exert pressure on behalf of U.S. companies.

Among the San Diego delegation, those voting for AB 1957 included Assemblywoman Shirley Horton, R-Bonita; Assemblywoman Christine Kehoe, D-San Diego; and Assemblyman Juan Vargas, D-San Diego.

Voting against it was Assemblyman George Plescia, R-San Diego. Assemblywoman Pat Bates, R-Laguna Niguel, and Assemblyman Mark Wyland, R-Del Mar, did not vote.

The Assembly also passed bills that would encourage the state to set up a bulk purchasing pool for drugs that individuals, nonprofits and small businesses could join.

In addition, the lower house passed legislation requiring the state to create a report card to include the cost, safety and effectiveness of prescription drugs.

The Assembly this year passed a resolution urging Congress to overturn a part of the new Medicare drug benefit law that prohibits bulk purchasing by the government, which advocates say would lower costs for drugs.