The Drug Importation Bill
Jude Wanniski
July 22, 2003


Memo To: Website Fans, Browsers, Clients
From: Jude Wanniski
Re: Pray it Doesn’t Pass!!

While you read this report on the drug importation legislation coming to a vote in the House later this week, note that the weakness on Wall Street the last few days has been led by the pharmaceutical companies. The Democrats will vote for this kind of legislation even though they surely realize the damage it will do. Has anyone asked Dr. Howard Dean how he feels about the bill?

Galen Institute
Health Policy Matters
July 18, 2003

Dangerous Dealings

Progress on Medicare negotiations in Congress has slowed as House members have been forced to focus on an issue that has become a nightmare for congressional leaders.

They made a deal with Missouri Republican Jo Ann Emerson in the middle of the night last month to buy her vote for the overall Medicare bill - which passed 216-215.

The deal: She demanded a full House vote on a bill by Minnesota Republican Gil Gutknecht that would make it legal for Americans to take advantage of other countries' government-imposed price controls by importing prescription drugs. But Gutknecht adds a dangerous new twist to similar "reimportation" legislation that already has passed both houses of Congress.

This time, the legislation would tell the Food and Drug Administration and HHS to take a powder, lifting previous requirements that the department would have to certify that they could continue to verify the safety of the U.S. drug supply (and that seniors would actually save money).

And drugs could come from Canada or any of 25 other countries, mostly Old and New Europe, but also including South Africa which has a huge drug counterfeiting problem.

Playing with fire. This legislation is reckless and a cheap political trick. The congressional leadership knows its dangers, but also is very, very concerned the legislation will pass - with conservative support. Nonetheless, they are bound to fulfill the promise to Emerson.

There are three key issues: The danger of price controls, the immeasurable damage to future research and development, and the safety of the U.S. drug supply - all huge considerations.

Steve Moore, of the Club for Growth and Cato, took on the first two concerns at a Wednesday Group meeting this week. He said the Gutknecht bill would import price controls with their inevitable market disruptions.

Further, he said that American consumers are bearing most of the burden for R&D costs now, but if we impose or import price controls, the next generation of miracle drugs would go away because no one would be left to pay for the R&D. Europeans already have destroyed their pharmaceutical research industry, and we would do the same if we follow this path.

Safety: At a briefing sponsored by Kerri Houston of Frontiers of Freedom on Thursday, Bob Goldberg of the Manhattan Institute focused on the safety issue, not only the risk of contaminating, compromising, and endangering our drug supply, but the real threat that this bill would invite terrorists to use this new portal to attack U.S. citizens.

Video: Kerri also showed a chilling video with actual footage of a modern "drug bust" in Los Angeles where prescription drugs are dumped out of their packaging into Ziploc bags, loaded into garbage cans, and sent to reprocessors where they make their way into the U.S. drug supply system. Consumers have no way of knowing if the drugs are expired, if they have become contaminated, or if they are put back in bottles that indicate what consumers are actually getting.

Kerri also is organizing a news conference on Capitol Hill today where at least 13 people, including members of Congress (and yours truly), will explain their concerns about importation.

The vote on the Gutknecht bill is scheduled [this] week. Pray that it doesn't pass.
Grace-Marie Turner


The debate over the Gutknecht bill to allow the importation of prescription drugs without current safeguards has reached a fevered pitch, with a House vote likely [this] week. The issue has created a split between conservatives who support importation on the basis of free-trade arguments and conservatives who realize importation would undermine pharmaceutical research and pose a significant safety threat, says Robert Novak. Robert Goldberg finds hypocrisy in the arguments of some Members of Congress who support the importation of cheap prescription drugs but oppose the importation of other goods when it harms their constituencies or pet industries. Jack Calfee says two scenarios could play out if drug importation is allowed -- one bad and the other worse. The international community could demand price controls in the United States or the pricing structure of prescription drugs could collapse. Finally, Doug Bandow describes in graphic detail the harm to pharmaceutical research and development that could be caused by an attack on prescription drug prices.

From the Chicago Sun-Times:

"Drug company backlash hits fever pitch in congress" by Robert Novak

From the Manhattan Institute:

"Two-timing" by Robert Goldberg

From the American Enterprise Institute:

"The high price of cheap drugs" by John E. Calfee

From the Cato Institute:

"Healers Under Siege" by Doug Bandow