- The Washington Times - Wednesday, January 18, 2006

Canadian online pharmacies, facing competition from the Medicare Part D program, are trying to capitalize on the massive drug benefit’s bumpy start this month to keep their senior customers.

The pharmacies have been quick to point out the problems that the Medicare program has been having.

“Where there are lapses in Medicare D coverage, Canadian pharmacies offer an excellent complement for most people,” said Amber McBain, business-development manager for OneWorldRx Inc., a Richmond, British Columbia, pharmacy processing company.

The company on its Web site, www.oneworldrx.com, set up a calculator to compare Medicare drug prices with the prices of Canadian drugs.

Ms. McBain, who deemed it too early to tell whether Medicare’s drug benefit is eating into OneWorldRx’s sales, said Canada’s drug prices are still lower than those through Medicare, the public health insurance program for the elderly and disabled.

But the Centers for Medicare and Medicaid Services, the federal agency in charge of Medicare, argued that using the drug plan often is cheaper than buying drugs from Canada, citing a recent report from AARP, a Washington senior-citizen advocacy group that long has called for drug importation.

The report said out-of-pocket costs under a Medicare plan generally would be less than buying the drugs from Canada through 2006.

“It’s also illegal for Americans to buy drugs from Canada,” said CMS spokesman Peter Ashkenaz, adding that the United States does not ensure the safety of drugs from Canada.

But Canadian pharmaceutical companies are pressing on with their marketing to senior citizens as well as baby boomers, who are not yet eligible for Medicare’s drug benefit.

Canada Online Healthlink Inc., a Vancouver marketing call center that operates www.candrugstore.com, sent out letters to its 30,000 customers, advising those who are eligible for Medicare to weigh their options before choosing a plan, said spokesman John Knox.

Nearly 24 million Americans have prescription-drug coverage through Medicare, according to government figures released this week.

Many seniors, who reported confusion over choosing a drug plan before coverage started Jan. 1, experienced problems filling their prescriptions in the past few weeks, with U.S. pharmacies being inundated with orders.

The U.S. Department of Health and Human Services this week acknowledged those problems, but said pharmacists were working to resolve them.

While Canada Online Healthlink posted a sales dip after the holiday season, Mr. Knox said it was too soon to tell whether the company was experiencing a traditional sales lag or a loss of customers to the Medicare program.

Universal Drugstore Ltd., a Winnipeg, Manitoba, pharmacy processing company, also is advising its U.S. customers about their options but has been careful not to rule out Medicare or recommend a specific drug plan.

“We don’t say Canadian drugs are the best option, but they are an option,” said Randall Stephanchew, Universal Drugstore’s pharmaceutical and professional services director.

Universal Drugstore, which makes about $58.5 million in annual revenue, posted a sales slump in the past few weeks, but “time will tell if that is because of Medicare,” Mr. Stephanchew said.

The Canadian online-pharmacy industry reported a sales slump during the third quarter, according to the most recent data from IMS Health Inc., a Fairfield, Conn., health care market research company.

Wholesale Canadian drug sales for cross-border Internet pharmacies dropped 28 percent during the quarter to $119.6 million from $166.7 million a year earlier.

To make up for any potential sales drop from older U.S. customers, Canada Health Solutions Inc., a Richmond, British Columbia, pharmaceutical company that runs www.cheaprxmeds.com, is focusing more of its marketing on other customers, such as older patients who are under 65, said Tony Lee, business development manager.

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