As prices of healthcare go up and healthcare is coming into reform, people are looking for more economical ways to fulfill their pharmaceutical needs. There has been much spoken about foreign pharmaceutical companies, specifically, Overseas markets offer basement bargain prices for common brand name pharmaceutical needs as compared to even those offered here in the states generically.
Why are pharmaceutical prices more attractive in the Canadian market than here in the states? First, Canadian prices are controlled federally by the Patented Medicine Prices Review Board (PMPRB). By using international prices for a benchmark, it is able to create price ceilings by disallowing prices to be more than the average price of seven international peers used a reference group. By monitoring the seven peer countries, Canada is able to keep its prices competitive; most of the time at least 5% below the average market price.
Additionally, provincial governments that deliver most Canadian healthcare, also affect pharmaceutical prices. Being highly socialized, the Canadian healthcare system efficiently provides drugs and other healthcare needs to its citizens. By providing large amounts of drugs, the provinces purchase the drugs in large amounts benefitting from negotiated bulk prices.
Another factor is the foreign economy. A lot of foreign countries are not as economically well off as the United States. For example, the Canadian mean income is about 20-30% lower than those in the States. This translates into even lower competitive prices in Canada than those prices offered in the States. Because Canadians can afford less, the market cannot afford to have higher prices and therefore offer drugs for a much cheaper price. Also, Canadian pharmaceutical companies have lower liability than those in the States because Canadians are less likely to sue drug companies and, when they do, the awards are a lot less than in the United States.
The ease of ordering Canadian drugs online is also attractive to those in the states. The Canadian pharmacy online offers most if not all drugs that can be found in the states at an attractive discount price and online ordering is as easy as ordering a book or dvd. While the States have started to competitively price prescriptions, the prices on some are still not as attractive as those offered in foreign markets and usually only offer generic drugs as opposed to the brand name.
People in the states can confidently order drugs from overseas because the drugs are still regulated and are wholly unaltered from its original form. The drugs come from trusted companies and people in the states still reserve the ability to bring a cause of action against the company if something goes awry.
It is hard to tell what the new healthcare reform will do when it comes to the effect of US citizens purchasing drugs from foreign markets; will the percentage of those doing so go up? Down? or will nothing change? But, we can see the combination of different economies, regulation and ease of ordering currently make overseas pharmaceuticals more attractive. Additionally, because there is still regulation on those drugs, people in the states can be confident the drugs are a healthy, trusted and cheaper alternative to generic drugs offered here in the United States.
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