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Allowing the "re-importation" into America of medicine sold abroad is one of those perennially debated issues. I've tended to oppose it on the grounds that it would wind up reducing innovation and decreasing the discoveries of miracle drugs by importing foreign-government-imposed price controls into the American drug market. But I can also see the free-trade argument, and it irks me as an American taxpayer and consumer that we're essentially paying top retail dollar for medicine while the rest of the world gets a discount.

Some recent press on the issue indicates that the Obama administration wants to push re-importation only after a health-care overhaul is passed, so the House and Senate bills don't touch the issue. In fact, advocates of re-importation, led by Senator McCain, lost a vote in the Senate. The issue usually comes up in connection with Americans importing cheaper drugs from Canada.

But now some enterprising Israelis are getting into the online pharmacy business, undercutting Canadian prices. MagenDavidMeds.Com is the site. The American pharmaceutical industry already has its patent issues with Israeli generic powerhouse Teva (NYSE:TEVA). The idea that an Israeli pharmacy is targeting American consumers with lower-priced versions of American drugs is sure to drive the Pfizers (NYSE:PFE) and Mercks (NYSE:MRK) of the world nuts.

Disclosure: No position

Source: Can Foreign Online Pharmacies Undercut North American Prices?