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Read Making a Killing

home / healthcare / in the media

The Los Angeles Times
Jan 23, 2004

by Gregg Jones, Times Staff Writer

Bill Would Open Door for Drugs;

Senate leader Burton will offer legislation requiring the state to consider buying cheaper pharmaceuticals from Canada.
SACRAMENTO -- In the latest challenge to the Bush administration over the cost of prescription drugs, the Democratic leader of the state Senate said Thursday he would introduce legislation that would require California to consider purchase of lower-cost Canadian drugs under state programs.

Senate President Pro Tem John Burton (D-San Francisco) said his bill could save the state at least $30 million a year and would force Republican Gov. Arnold Schwarzenegger and President Bush to take a position on existing federal law, which allows only drug manufacturers to import prescription drugs.

Strained by soaring drug costs during a time of tight budgets, a growing number of states are calling for the federal government to ease restrictions on importing drugs from Canada.

Name-brand prescription drugs on average are 41% cheaper in Canada, according to Stephen Schondelmeyer, a University of Minnesota professor of pharmaceutical economics, who testified at a state Assembly hearing earlier this week.

Assemblyman Dario Frommer (D-Los Feliz), chairman for the hearing, also is poised to introduce legislation aimed at allowing Californians to purchase prescription drugs from Canada.

Burton's bill would require the state Department of General Services toconsider Canadian suppliers when buying drugs for prisons, mental hospitals, youth correctional facilities and developmental centers. It would not apply to Medi-Cal, the state-federal health program for the poor.

The state spent $176 million last year on prescription drug purchases apart from the Medi-Cal program -- a 354% increase since 1996, Burton said at a Capitol news conference.

"The drug companies, as usual, even when forced into a competitive bid, are gouging us," he said.

Drug companies maintain that federal restrictions on imports from Canada and elsewhere protect consumers.

"The issue has been addressed by Congress and they have repeatedly put restrictions on importation due to safety concerns," said Merrill R. Jacobs, who oversees Sacramento lobbying efforts for the Pharmaceutical Research and Manufacturers of America. Jacobs said he had not seen the Burton bill, but he questioned whether it might conflict with existing federal law.

Burton angrily dismissed the safety argument.

"Canada has testing standards equivalent to ours," he said. "It's just a bogus deal."

Consumer activists also dispute the safety concerns. They say many drugs imported from Canada are manufactured in the United States and sold to Canadian suppliers under low-price bulk purchase deals that aren't available to U.S. consumers.

The Schwarzenegger administration has requested a meeting with lawmakers to discuss Canadian drug imports, a legislative source said.

"The administration does have concerns with the growing cost of prescription drugs," said Ashley Snee, a Schwarzenegger spokeswoman. "We look forward to working with the Legislature to find ways to reduce the cost in accordance with the law and in ways that won't sacrifice quality."

She said the governor has taken no position on Burton's bill.

Consumer advocates welcomed Burton's proposal.

"It's the right proposal at the right time, but the state needs to look at health insurance rates and hospital costs as well," said Jerry Flanagan of the Foundation for Taxpayer and Consumer Rights in San Francisco.
---------------
Times staff writer Nancy Vogel contributed to this report.

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