- The Washington Times - Tuesday, February 21, 2006

ST. PAUL, Minn. — Retired furniture store owner Don Brock quit buying prescription drugs from Canada this year now that he has signed up for the new federal Medicare drug benefit.

The next time he needs a refill on Lipitor, his daily anti-cholesterol drug, Mr. Brock will go to a pharmacy near his home in Litchfield. The 74-year-old says he was saving about $300 annually buying Canadian; now, he figures he will save about $500 buying through Medicare.

Canada is losing traction as a source of cheaper prescription drugs for many Americans. Cross-border sales have fallen as much as 30 percent, according to the Canadian International Pharmacy Association, since about 42 million seniors and disabled people became eligible for Medicare drug coverage Jan. 1. The group says U.S. authorities have stepped up enforcement of laws against importing foreign medicines. Several state Web sites connecting residents with Canadian pharmacies have also seen business fall off.

“Medicare Part D won’t pay for any drugs out of the country, so I’ve had to stop that,” said Mr. Brock, who bought Canadian drugs for more than two years. “I am saving money on this.”

While Canadian pharmacists expect some of that traffic to return, they are also considering marketing more heavily to some of the 45.5 million uninsured Americans who can’t afford to pay retail drug prices at home.

Canadian Internet pharmacies catering to American customers sprang up about six years ago, filling a market created by busloads of U.S. border-state seniors who went north seeking cheaper medications. Despite pressure from the pharmaceutical industry to enforce laws against the practice, U.S. regulators took a hands-off approach toward those who imported drugs for personal use, and some states turned to Canada to find savings.

Residents of Illinois, Kansas, Missouri, Vermont, Wisconsin, Minnesota, New Hampshire, North Dakota, Rhode Island, Washington and the District of Columbia can access state government Web sites connecting them with select Canadian pharmacies, according to the National Conference of State Legislatures. Nevada is in the process of setting up a site.

Experts say the Canadian pipeline won’t disappear.

“Seniors aren’t the only ones who use drugs from Canada,” said Stephen Schondelmeyer, who directs a pharmaceutical economics research institute at the University of Minnesota. “For the people who don’t have insurance somewhere else, Canada is still a very viable alternative.”

Andy Troszok, the president of the Canadian International Pharmacy Association, blames the business falloff mostly on Medicare. But he expects to get some of his older American customers back.

That’s because of the so-called “doughnut hole” in Medicare, which leaves participants on their own for drug costs between $2,250 and $5,100. American seniors could turn back to Canada for cheaper prescription medicine when they reach that hole — but they would do so knowing that Medicare wouldn’t give them credit for whatever they spent on Canadian drugs.

But, for some, it would be cheaper still than paying American prices.

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