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Canadian pharmacy group warns of supply problems

The trade group representing Canada's largest Internet pharmacies told American cities and states last night to stop planning large-scale prescription drug purchasing plans for employees, saying tens of thousands of new customers would create widespread supply problems for consumers on both sides of the border.


The announcement came just a week after Boston Mayor Thomas M. Menino announced that he will begin importing drugs from Canada for city workers in a pilot program. Menino planned to be in Washington, D.C., today to press Food and Drug Administration officials to authorize his plan.

New Hampshire Governor Craig Benson also announced plans for Canadian importation last week, including a website allowing New Hampshire residents to prescreen Canadian pharmacies and a system of purchasing drugs for the state's prison population and Medicaid recipients who suffer from mental illnesses.

The growing wave of interest has set off alarm bells at the Canadian International Pharmacy Association, which represents 25 large Internet pharmacies. The organization's executive director, David MacKay, told the Globe last night that a tightening of supply by US drug companies in retaliation for the Internet trade is causing increasing worries that local pharmacies serving Canadians will begin running out of drugs.

If that happens, Canadian authorities have warned that they will seek to shut down the Internet pharmacies, a scenario that the Internet pharmacies want to avoid at all costs, MacKay said. Thus far, the Canadian government has taken a hands-off approach to the cross-border trade, calling it an American problem. The Internet pharmacies, which have built their business to more than $700 million a year, want to keep it that way.

Internet pharmacies are not going to build their business "on the backs of Canadians," MacKay said.

He specifically warned governments from adopting programs similar to Springfield's, which caters to city employees and retirees and has saved the city an estimated $750,000 this year.

In addition to Boston and New Hampshire, Iowa, Illinois and Minnesota have taken the lead in studying imports from Canada, where drugs are 20 to 80 percent cheaper because of government price controls. Pfizer Inc., GlaxoSmithKline, and other US drug companies announced this year they would limit supplies to Canadian pharmacies to avoid the drugs coming back to the United States at lower prices. Last week, Pfizer issued a fresh warning to Canadian drug wholesalers and pharmacies engaged in cross-border sales.

"We wanted to make sure the supply of medicines for Canada went to Canadians," said Pfizer spokesman Jack Cox.

Menino said yesterday that he was willing to work with the Canadian pharmacies on supply problems. A spokesman for Benson also said supply problems could be overcome.

Boston's importation program is expected to be launched in July for some city employees, a plan Menino estimates will save the city $1 million a year. Yesterday, Menino said he will tell the FDA that drugs from Canada can be imported safely. He will ask the FDA to review his proposal under a provision of the new Medicare prescription benefit law that permits importation if the government certifies it as safe.

"We in America pay the top price for all these drugs," Menino said. "As a consumer, and as a mayor of our city, we can't walk away from our responsibilities, and we have a responsibility to get the cheapest prescription drugs for our workers."

William Hubbard, the FDA's associate commissioner for policy and planning, said agency officials will warn Menino about the potential dangers of counterfeit and unapproved drugs and the liability Boston could assume if someone were injured by a drug imported illegally from Canada. "Several have talked to us, and I think the ones thinking about doing something, they have declined to proceed because they have a better understanding of our concerns," he said.

Christopher Rowland can be reached at

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