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Cancel the Discount?

 

FAIRMONT — Mary Ellen Nottingham was running an errand earlier

this month when she spotted a photographer taking pictures of Fairmont's

Discount Prescription Center. "I thought: Oh no, it's happening." She told her

  • ister-in-law to wait in the car.
  •  

     

    "I told myself, if he's trying to put them out of business,

    maybe I can do something," she

  • aid.
  •  

     

    She'd seen on television that the West Virginia Board of

    Pharmacy is trying to shut the place down. She feared the photographer was a

  • tate worker, gathering evidence of some sort.
  •  

     

    The 5-foot-1 woman didn't calm down until the newspaper

    photographer explained that he was just taking pictures for a story. "I was

    ready to make a stand," she

  • aid.
  • "I guess he thought I was going to attack

    him."

     

     

    Nottingham believes her health is at stake. She orders seven

    prescriptions from Canada through Discount Pharmacy Center, including Lipitor,

    Plavix, Glucophage and Tricor. "I'm on 18 different pills a day now," she

  • aid. "I'm diabetic, and I've had aorto-bifemoral bypass surgery.
  •  

     

    "Medicine keeps me alive," she

  • aid.
  • "Medicine, the Lord and

    these people who run this business."

     

     

    She buys a three-month supply, the maximum anyone can import at

    one time. "I'm saving around $400 a month," she

  • aid.
  • "A lot of people might

  • ot know what a difference that makes. I can put gas in the car. And I can eat
  • right. When you don't have money, you eat a lot of macaroni and potatoes."

     

     

     

    Catching her breath inside the store, Nottingham said that,

    after 33 years of making a decent living — 28 at Fairmont's Electronic Control

    Systems — she developed near-fatal heart disease and couldn't work anymore.

     

     

     

    "Boom, the paycheck was gone," she

  • aid.
  • "It's been rough, to

    put it mildly."

     

     

    Now she lives on her pension and Social Security, minus her

    Medicare B payment. She gets about $1,200 a month total. "It's gone practically

    before I get it," she

  • aid.
  • Medicare does not cover her prescription

    drugs. "I'm so thankful this place opened up."

     

     

    Not everybody is as thankful

     

     

    In May, the state Board of Pharmacy ordered Discount

    Prescription Center to shut its doors or face legal action. The pharmacy board

    contends that the center is a pharmacy without a pharmacist.

     

     

    Pharmacy boards in at least 19 other states are defending their

    turf, trying to shut down buy-from-Canada storefronts. Hundreds of these little

    businesses have sprung up in at least 30 states in the past year. The U.S. Food

    and Drug Administration is urging state boards to put on the lid on them before

    they spread further.

     

     

    In March, the Arkansas pharmacy board sent the nation's first

  • hut-down-or-be-prosecuted letter to one of these new storefronts. Owner Carl
  • Moore told USA Today that he would appeal to the U.S. Supreme Court if

  • ecessary. "We believe that we're morally and ethically right," he
  • aid.
  • "We're

    going to fight like a wild animal."

     

     

    To the dismay of pharmaceutical companies and local pharmacies,

    Canadian Internet firms have developed a new marketing tool. Each week,

    busloads of prescription-filling Americans cross the Canadian border. At least

    a million Americans order by computer. Now Canadians are partnering with

    American entrepreneurs to attract customers like Nottingham who feel most

    comfortable in a U.S. store, where someone can help them.

     

     

    West Virginia University law professor Bob Bastress represents

    owner Carole Becker and her husband, Steve, who manages the store. He has filed

    a motion asking the Kanawha Circuit Court to block the state effort to shut the

  • tore down. The hearing is scheduled for Oct. 2.
  •  

     

    The case is local, Bastress said, but it involves international

    issues: American access to more affordable drugs and access to foreign markets,

    pharmaceutical company profits, and senior citizens who can't afford drugs. It

    may be the nation's first such hearing. Other states, the FDA and

    pharmaceutical companies will be following it.

     

     

    "The pharmaceutical companies have wanted to shut down the

    Canadian outlets for years," said Kevin Outterson, who teaches health law at

    WVU. "When people started buying Canadian drugs over the Internet, the

    companies didn't know how to stop that buying, because it would mean arresting

    Grandma and Grandpa here in the States. That's not going to happen.

     

     

    "But older people aren't as adept with computers as younger

    people are. So these storefront facilitators have developed. Storefronts are a

    much easier target, politically."

     

     

    Meanwhile, the Fairmont store — located in a rehabbed gas

  • tation — is open for business, right across from Fairmont General Hospital.
  • Like storefronts in other states, it isn't fancy and doesn't require much

    overhead. American and Canadian flags fly from the building. Signs are modest.

    One small, tidy room holds some bookshelves, a few chairs and a table with a

    laptop computer, phone and fax machine.

     

     

    When Mary Ellen Nottingham first came in, Steve Becker showed

    her what her prescriptions would cost in Canada. "I couldn't believe I can sit

    in Fairmont, W.Va., and get prices like that," she

  • aid.
  •  

     

    She found she could get a month of Lipitor for $55.50, a month

    of Plavix for $69.30 and a month of the generic of Glucophage for $9.72. It

    would cost her about twice as much in Fairmont.

     

     

    Nottingham showed Becker her prescriptions, and he faxed the

    forms, her medical information and her credit card number to his Manitoba-based

    partner, discountprescriptionsofcanada

     

     

    .com. A Canadian doctor reviewed Nottingham's form and

    prescriptions for accuracy and validity, as required by Canadian law, Becker

  • aid. The company managers verified her credit card and shipped the drugs to
  • her address.

     

     

    Critics say this is exactly the problem. There is no pharmacist

    at the Fairmont store to make sure Nottingham isn't ordering two conflicting

    medicines, for instance. Nottingham says her doctors — and the Canadian doctor —

    do that.

     

     

    She got her medications in the mail at her Fairmont home within

    two weeks after she ordered them, she

  • aid.
  • She didn't pay Becker anything.

    Discount Prescription Center gets a 10 percent fee from his Canadian partner

    for every prescription they process. "That's how I make money," he

  • aid.
  • There's a processing fee no matter how you order, he

  • aid.
  •  

     

    The store prices are in the ballpark for Canadian Internet

    pharmacies: 30 percent to 80 percent lower.

     

     

    Prices, not patient safety, are the driving force behind all

    this, said Outterson. "A huge proportion of the industry's global profits

    depend on maintaining the U.S. prices. If U.S. prices went down to the level of

    Canadian prices, the pharmaceutical industry would lose tens of millions of

    dollars."

     

     

    But health care costs — and therefore health insurance rates —

    would go down. "Health insurance rates would decrease and stabilize somewhat,

    which means more small business owners would be able to offer health insurance

    to their employees," said Sally Richardson, who directs WVU's Institute for

    Health Care Policy.

     

     

    Not just a West Virginia story

     

     

    Steve Becker says he and his wife are fighting the shutdown

    order on principle. "This is something that changes people's lives," he

  • aid. "And I don't believe it's any more illegal than a business that helps
  • people get packages ready for the post office."

     

     

    He is not for a drug-ordering free-for-all. He believes the

    Canadian market is safe, for instance, but the Mexican market is not. "Anybody

    who trusts the Mexican drug market obviously hasn't been to Mexico," he

  • aid.
  •  

     

    William Douglass, director of the West Virginia Board of

    Pharmacy, says he stands on principle, too. He is protecting the public well-

    being. "We don't want to stop people from finding cheaper sources for their

    prescription drugs," he

  • aid.
  • "We know a lot of people need that. We just don't

    believe this source is either safe or legal."

     

     

    "Those kinds of statements really tick off Canadian officials,"

    Becker

  • aid.
  •  

     

    Bastress contends that the FDA is responding to pressure from

    the pharmaceutical industry on the Bush administration. The FDA denies

    it. "Because the medications are not subject to FDA's safety oversight, they

    could be outdated, contaminated, counterfeit or contain too much or too little

    of the active ingredient."

     

     

    "Canada has their own equivalent of the FDA and, if anything,

    they've got a better record than we do." Becker said, recalling that fake

    Lipitor recently turned up in the U.S. drug stream, and a Missouri pharmacist

    was convicted of diluting people's cancer prescriptions.

     

     

    "I can't speak for how their regulatory bodies are up there.

    I'm not really familiar with them," Douglass

  • aid.
  • "But to have something

    coming from as far away as across the border of a foreign country allows the

    criminal element to have more of a success."

     

     

    "There are no drugs on my clients' premises," Bastress

  • aid.
  • "They do not handle drugs, dispense drugs or accept money from people

    ordering the drugs. They process orders. How can anyone call that a

    pharmacy?"

     

     

    Shift in how drugs

     

     

    are bought and sold

     

     

    Buy-from-Canada storefronts are multiplying fast. Tulsa, Okla.-

    based RxDepot opened its doors in 2002. By early August, there were 74 RXDepots

    in 24 states, according to RXDepot President Carl Moore. Florida has about 150

    such storefronts, he

  • aid.
  •  

     

    The Florida pharmacy board has taken no action. Others are

    ready to pounce. In May, the Kentucky Board of Pharmacy director told the

    Louisville Courier-Journal that if a storefront opens in Kentucky, "We will

    proceed fairly quickly with an injunction."

     

     

    The U.S. Congress appears to be going in the other direction.

    Both houses have passed bills that would legalize prescription drug-buying from

    Canada. Those bills are stuck in committee. And politicians are stuck between

    increasingly angry seniors and a pharmaceutical industry that contributed more

    than $20 million to congressional campaigns in 2002.

     

     

    The FDA warns that Canadian Internet pharmacies don't have

    enough drugs to supply the United States, so counterfeits are inevitable. If we

    get the orders, we'll get the drugs, Canadian pharmacies say.

     

     

    No, you won't, the pharmaceutical companies say. Three of the

    world's largest pharmaceutical companies — Pfizer, AstraZeneca, and

    GlaxoSmithKline — are trying to cut the Canadian pharmacies off at the pass.

    They have announced they will cut off supplies to Canadian Internet pharmacies

    that buy drugs at wholesale prices, then resell them to Americans at Canadian

    prices. Canadian wholesalers are planning end runs.

     

     

    "There are antitrust issues here," said WVU's Outterman. "You

    can't tell people who they can sell to."

     

     

    Canadians have a lot of money at stake, too. Like West

    Virginia, the province of Manitoba is economically stressed. The Canadian

    Internet pharmacy business is centered there. "Suddenly, they have access to

    millions of customers," Outterman observed.

     

     

    Earle Turow, chairman of Discount Drugs of Canada, told Newsday

    he expects his organization to clear $100 million next year. He thinks the

    Internet industry should be internationally regulated, not shut down, he

  • aid.
  •  

     

     

    "We're doing good work for the seniors," Turow

  • aid.
  • "We're

    running a straight business. If they try to shut us down, they're going to be

    confronted with a major uprising from the seniors."

     

     

    "If you look at this logically," said Carl Moore of

    RXDepot, "do you think, with that World Wide Web, that these people are going

    to be able to hold 400 million people hostage with prices that are two and

    three times as high as anywhere else in the world?

     

     

    "You've got the big pharmacy companies scared to death," he

  • aid, "because for the first time in their life, they're having to face free
  • enterprise in this country."

     

     

    Desperation ignites

     

     

    "a genuine consumer revolt"

     

     

    In Fairmont, Howard Postlethwaite plopped down for the first

    time on one of Discount Prescription's folding chairs. "How're your legal

    troubles coming?" he asked Steve Becker, as if the two were old

    buddies.

     

     

    At age 70, Postlewaite is diligently investigating drug prices.

    The retired life insurance agent has decided he and his wife can no longer

    afford their Medigap insurance. He is trying to find ways they can afford their

    medicine.

     

     

    "I'm a radical when it comes to pharmaceutical companies," he

  • aid.
  • "Every time I go to pick up some medicine for me and my wife, the price's

    gone up." He has figured out that it will cost him more to keep the insurance

    than to shop around and buy from other countries.

     

     

    Postlethwaite has systematically researched the subject on the

    Internet. "The pharmaceutical companies have over 600 lobbyists registered in

    D.C., and they give millions a year to politicians," he said, so he doesn't

    believe Congress will actually pass anything that gives Medicare prescription

    drug coverage.

     

     

    "It's all for the campaign," he

  • aid.
  • "After that's over,

    they'll forget about it."

     

     

    He is determined to get those low prices. "I have to," he

  • aid.
  • "If they manage to shut the whole thing down, my wife and I will be

    driving up to Canada every three months."

     

     

    Earlier this month, a Washington Post editorial called the

    American consumer's increasingly defiant determination to buy from Canada "a

    genuine consumer revolt."

     

     

    An Internet search turned up at least 26 stories about the FDA

    effort to shut down the storefronts. The stories come from many states:

    Delaware, Indiana, Florida, Arkansas and Montana, among others.

     

     

  • In Michigan, 50-year-old customer Diane Jones told The

     

    Washington Times that "I have to work an extra job so that I could pay for my

    pills. I have no idea why our government wants to force us to buy these drugs

    from Canada. But that's what we will do."

     

  • In Indiana, Laura Everbach told the Courier-Journal that "I

     

    don't know how they [FDA] think poor people — you know, on Social Security and

    fixed incomes — can do it," she

  • aid.
  • "As long as I can get it that much

    cheaper, I'm going to."

     

  • Florida customer Anne Hinson told the USA Today that "My

     

    mother has flat refused to buy her heart medicine [at American prices] because

    it costs more than she gets in a month."

     

    Earlier this summer, the city of Springfield, Mass., announced

    that it will buy prescription drugs through Canada for its employees and

    retirees, saving the city $4 million to $9 million a year.

     

     

    The FDA commissioner asked Springfield's mayor to reconsider,

    for the safety of his city's citizens. The mayor said he has bought his son's

    diabetes medication from Canada for years and has heard of no safety problems

    with the Canadian supply.

     

     

    Are prescription

     

     

    drugs a utility?

     

     

    Given consumers' determination to get low prices, all this

    legal action could paradoxically make the market less safe for consumers, said

    law professor Outterson.

     

     

    "If they shut down Canadian outlets that can be regulated, they

    will be sending American customers to highly unregulated outlets that truly

    might be dangerous." Thailand, Brazil and India all ship large quantities of

    much-less-regulated drugs worldwide, for instance.

     

     

    Outterson suggests that, if West Virginia wants to find a

    creative solution, it might make more sense to explore ways to let state

    pharmacists buy prescription drugs through Canada, then perhaps tack on a

    processing charge.

     

     

    "The political atmosphere is right for something like this," he

  • aid, "and I think a legal way could be found to do it.
  •  

     

    "That would probably set up a furious battle between the state

    of West Virginia and the pharmaceutical companies and the federal government.

    But wouldn't that be a glorious fight? The state and the citizens could save

    tens of millions of dollars a year in drug costs. I think at the end of the

    day, West Virginia would win."

     

     

    The pharmaceutical companies sued when Maine announced it was

    going to use its Medicaid clout to demand lower prices, and the Supreme Court

    ruled in Maine's favor earlier this year, he noted.

     

     

    In Fairmont, Steve Becker is philosophical. The U.S. Senate has

    passed a bill that would let U.S. pharmacies import Canadian drugs.

     

     

    If Congress were to pass it, he'd probably be out of business.

    If that happens, he said, he would be happy for his customers and go back to

  • elling health foods and vitamins, "and other things that keep them from
  • eeding drugs in the first place."
  •  

     

    Whatever happens, he predicts, U.S. pharmaceutical drugs will

    eventually be regulated as a utility. "Americans won't tolerate these prices

    much longer, he

  • aid.
  •  

     

    "The pharmaceutical companies have worked very hard over the

    past 40 years to convince the American people that we can't do without their

    products and services. And the American people have bought it. The vast

    majority now believe that they can't make it without these pharmaceuticals." he

  • aid.
  • "Any kind of moral judgment aside, we have to begin to consider that

    pharmaceutical companies are utilities."

     

     

    West Virginians average 15 prescriptions a year, 4 more than

    the national average, according to Blue Cross Blue Shield of America.

     

     

     

    "We have traditionally regarded utilities as those goods and

    services that society cannot do without," Becker

  • aid.
  •  

     

    "That goes right to the heart of the pharmaceutical company's

    argument that this is a free market. The necessity of those goods to our

  • ociety far outweighs the business's wish to do as it pleases.
  •  

     

    "We are totally dependent on pharmaceuticals," he

  • aid.
  • "Seems

    to me, that makes them a utility."

     

     

    A lot must happen to get from here to reasonable regulation, he

  • aid.
  • He and his wife will play their small parts in this international drama

    by going to court in October.

     

     

    To contact staff writer Kate Long, use e-mail or call 348-

    1798.

     


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