Internet pharmacies in Canada fighting back against opponents

WINNIPEG, Manitoba -- Fast-growing Manitoba companies selling discount drugs from Canada to U.S. customers now have a partner in their battle with the pharmaceutical giants -- local regulators.

Six months of mediated talks have brought a tentative agreement between the Manitoba Pharmaceutical Association and a group of Internet pharmacies on acceptable practices for an industry creating hundreds of jobs in this prairie province north of Minnesota and North Dakota.

The pact addresses an issue that major drug making companies have raised as a concern: whether the Canadian pharmacies are providing proper patient care and quality control.

Manitoba is home to at least 55 of the estimated 150 Canadian operations estimated to bring in more than $500 million a year in an expanding and quickly changing industry.

Ronald Guse of the province's regulatory association said he expects continued growth despite efforts by GlaxoSmithKline and other pharmaceutical companies to diminish the trade.

'Increasing exponentially'

"It's been increasing exponentially and will continue to do so, not only in Manitoba but throughout much of Canada," Guse said. "People keep saying this is going to be slowed or stopped, but I haven't seen any indication of that."

The Canadian operations fill prescriptions from U.S. patients, capitalizing on the disparity of drug prices and dollar values between the North American neighbors.

Canada regulates drug prices as part of its national health care system, while the market dictates pricing in the United States. Many popular medications for chronic conditions such as high blood pressure and high cholesterol can be bought in Canada at less than half the U.S. price.

The business worries pharmaceutical giants like GlaxoSmithKline Inc., which sell their products for more money in the United States than in Canada. GlaxoSmithKline has cut supplies to some Canadian Internet pharmacy operations, saying the medicine it provides in Canada is prohibited from sale elsewhere.

The supply cuts cause problems, such as customers waiting three weeks beyond the normal order-filling time to get small quantities of medicine, said Andrew Yan, chief pharmacist at Internet pharmacy canadameds.com of Winnipeg.

"Sometimes I'm surprised our customers are putting up with it," Yan said. "That just tells me how desperate they are. They just can't afford it in the United States."

He denied the reduced supplies would cause his company to seek alternatives from countries with less-stringent regulations, a concern cited by pharmaceutical companies and regulators.

"It's making it difficult, but no, we would never turn it into an underground operation," Yan said.

Such issues prompted Guse's association to enter mediation with an association of Manitoba Internet pharmacy operations that initially rebuffed its regulatory efforts.

A tentative agreement from six months of talks is being fine-tuned before a ratification vote by the pharmacies scheduled for June 23. If it is accepted and the Manitoba Legislature passes enabling legislation, the agreement would give the Manitoba industry a unified, regulated status to proceed, Guse said.

Provincial officials were expected to support the industry by passing the legislation.

Guse's main concern is whether the U.S. patients getting their medicine from Canada receive proper care. Currently, Internet operators in Manitoba have Canadian physicians authorize prescriptions from U.S. doctors.

"Are they just signing it, and moving it on through the system, or is the physician in fact providing the care they have to under their medical standards?" he asked.

Under the legal changes required, Manitoba would recognize the validity of prescriptions from U.S. doctors and its regulators would get greater powers.

In particular, the association is now prohibited by law from sharing any information about pharmaceutical prescriptions with other jurisdictions. Lifting that restriction would allow proper investigation of any problems with medicines sent to U.S. patients, Guse said.

The association already requires Manitoba Internet pharmacies to register and pay $9,635 a year for a license, compared to $510 for a regular pharmacist, according to Guse. The license fee covers the group's increased legal costs due to the Internet pharmacies.

Colin MacArthur, an attorney representing the Manitoba International Pharmacists Association that negotiated the tentative agreement with Guse's association, said it would address the patient care issue.

He noted there was no legal impediment to industry growth, with the U.S. Federal Drug Administration so far refraining from imposing a prohibition on imported pharmaceuticals.

"That discretion is being exercised to allow U.S. citizens to import prescription pharmaceuticals for their personal use," he said.

In some U.S. states, authorities are cracking down on "storefront operations" selling medicine from Canada at a U.S.-based facility to U.S. customers.