Prescription drugs are often cheaper abroad. In some cases, prices are much lower due to lower standards of living in poor countries. In other cases, prices are lower because some countries have price controls and regulations limiting what they pay for drugs.
It is technically against federal law to import drugs into the United States except those authorized by the manufacturer. This is how U.S. drugmakers can charge much higher prices domestically. The ban on drug reimportation allows drug manufacturers to price discriminate, charging different prices in different markets. This only works if you can prevent arbitrage, which is preventing someone bypassing the expensive products by importing cheaper ones.
Seniors who live near an international border have long taken advantage of cheaper drug prices abroad. Cross any U.S. border with Mexico and within a few hundred yards of the international border crossing you will find numerous farmacias. These are usually narrow storefronts that extend deep into the building. One side of the store is filled with cheap drugs you can buy without a prescription, while the other side of a central aisle is filled with liquor. Americans are generally allowed to bring back a 90-day supply of personal medications, excluding controlled substances. Consumers are also allowed to mail order small quantities of medications from pharmacy websites in countries like Canada if those drugs are unavailable locally. Because there is no straightforward way to verify whether drugs are available locally most are allowed to pass through the mail system by the U.S. Customs Service.
The cost of drugs purchased abroad is sometimes one-half or even one-third what it would cost in the U.S. An epinephrine autoinjector (Epi Pen) ranges in price from $167 at Walmart to $297 at Walgreens but is about $95 from a Canadian pharmacy. Wegovy GLP-1 weight loss pens that were once $1,619 (list price) are now $499 at many U.S. pharmacies but $399 at Canadian pharmacies. Sovaldi (sofosbuvir) was the first drug that could cure Hepatitis C. At $1,000 per pill, a full course of treatment is $84,000. A generic version of Sovaldi (unavailable in the U.S.) is only $2,623 for 84 tablets at a Canadian pharmacy. Before the patent expired Viagra (sildenafil) cost between $60 and $70 per tablet if purchased in the U.S. Numerous sketchy websites sprung up to ship unlicensed generics from India for $2 per pill.
Sometimes it is worth traveling to get cheaper drugs. The cancer drug, Keytruda (pembrolizumab), is $58 per milligram, meaning a 200mg dose is nearly $12,000. A full course of treatment can cost nearly $200,000 in the United States. In India the cost is much lower, or between $1,500 and $2,500 a dose, or about $22,000 to $37,000 for a full course of treatment. Now CNBC reports that some companies have adopted plans to import drugs, or when that is not feasible, sending patients abroad to procure them. The following was reported by CNBC:
In 2019, Zimmerman said, his then-employer offered him an opportunity that sounded irresistible: He and his wife, Becky, could take all-expense-paid trips to the Cayman Islands and the Bahamas to retrieve the medication he needed, Avonex, a drug made by Biogen that currently retails in the U.S. for $2,159 per weekly dose. Through Florida-based PriceMDs, which paid for the couple’s travel, Zimmerman’s Avonex would be free of charge.
Facilitators, called alternative funding programs (AFPs), help patients and employers get medications at affordable prices. Although flying a patient to the Caymans for an expensive drug sounds a little extreme, most patients can stay home, and the drugs arrive by mail. More from CNBC:
But AFPs come with a major catch: Federal authorities say importing medications intended for foreign markets is illegal and could pose risks to patients’ health.
Authorities report that AFPs are becoming more common as the price of drugs have skyrocketed. A few states have even passed laws specifically allowing importation of drugs from Canada. These include Vermont, Colorado, Florida, Maine, New Hampshire, New Mexico, North Dakota, Texas, and Wisconsin, although only Florida has had their plan approved by the FDA. While it is common for individuals to order drugs online from Canada, now employer plans, school districts, cities, counties and even unions are working with AFPs. Drugmakers, whose business model is largely predicated on unreasonable prices paid by employer plans, oppose such measures and try to discredit such maneuvers.
Read more at CNBC: U.S. employer health plans tap prescriptions that feds say are illegal