by Richard Morrison
April 25, 2008

Washington, D.C., April 25, 2008—With the high cost of pharmaceutical drugs playing a central role in the national debate over health care, many policymakers have endorsed the idea of buying U.S.-made drugs from other countries, where prices controls make them far cheaper. Competitive Enterprise Institute Senior Fellow Gregory Conko, however, explains why such a policy of drug “reimportation” would ultimately slow innovation and mean fewer life-saving drugs in the new study Drug Reimportation’s Dangerous Allure: A Misguided Const-Control Measure Guaranteed to Harm Patient Care.

“All three Democratic and Republican party presidential candidates seem to agree that the prices of innovative new pharmaceuticals are unfairly high, and that costs could be controlled if only Congress would legalize the large-scale reimportation of drugs from countries like Canada, where price controls make drugs more affordable,” writes Conko. “But, that attitude is short-sighted, and implementing it as policy would have serious negative consequences for American consumers.”

“Reimportation advocates believe the process is simple and cost-free, but the solution to high drug prices is not so simple,” said Conko. Legalizing reimportation might lower prices in the short term for already developed drugs, but it would reduce the capital available for research into new drugs, choking off the development pipeline. “When we reimport drugs from foreign countries, we are actually importing their price controls,” writes Conko. “That, in turn, will produce the problems that price controls always produce – the destruction of future productivity and innovation.”

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