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Read Making a Killing

home / healthcare / in the media

San Diego Union-Tribune
Aug 21, 2004

by Jordan Robertson, UNION-TRIBUNE

Rx Depot loses bid to end injunction

A Tulsa company that sold imported prescription drugs from Canada bowed to legal pressure from the Food and Drug Administration yesterday and agreed to permanently halt the practice.

Rx Depot, which operated three stores in San Diego under the name Rx of Canada, closed all 85 of its stores in November after a federal injunction was issued against the company.

The business would send domestic prescriptions to a Canadian partner pharmacy, which would kick back a commission to Rx Depot when it sent the drugs directly to U.S. customers, the FDA said.

Health regulators say that imported drugs are dangerous because they aren't subjected to the same oversight and regulations as domestic drugs.

But Rx Depot president Carl Moore said the business was good for senior citizens who couldn't afford pricey domestic drugs. He appealed the order unsuccessfully.

The FDA said yesterday that Moore and another corporate officer, David Peoples, had agreed to a consent decree that makes the injunction permanent.

"The defendants' illegal importation of drugs posed a significant public health threat," acting FDA Commissioner Lester Crawford said in a statement. "This consent decree sends a clear signal that those who would put profit before safety will not be allowed to threaten the public health."

The attorney representing the company, Fred Stoops of Tulsa-based Richardson, Stoops, Richardson & Ward, was out of town and did not return phone calls.

Critics of the government's campaign against imported drugs said yesterday the agreement was a victory for big drug companies.

"It's just telling pharmaceutical companies they can charge as much as they want. It's a license to steal from seniors," said Jerry Flanagan, spokesman for the Foundation for Taxpayer and Consumer Rights. "These importing companies are the seniors' last options. Short of that, they're forced to go to Canada to get their prescriptions. It's really a sad state of affairs when they have to travel hours, in some cases days, to get the medicine they need to stay healthy."

Flanagan said Canada negotiates bulk discounts for its patients -- "it's sort of the Costco approach to discount drugs; the more you buy, the better the discounts" -- and urged U.S. health officials to do the same.

Bill Bradley, spokesman for the California Pharmacists Association, said his group is "thrilled" with the agreement and would like to see some kind of oversight and regulation on imported drugs.

"We absolutely understand the need for cheaper prescriptions," he said. "But these types of stores are not helping seniors in any way. They're saving money, but in the long term it's a buyer-beware situation. In the long run these drugs could hurt them because you never know what you're getting."

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