Wayward Drug Crusade

In a meeting at the Hyatt Regency on Capitol Hill last week, healthcare administrators hailed the new prescription drug benefit that Congress recently added to Medicare as an opportunity to make “big earnings gains.” That’s why the sponsors of the convention paid $10,000 to get their companies’ names and logos imprinted on “handsome canvas bags,” and $15,000 for “a networking reception ... for success!”

From a taxpayer and consumer viewpoint, the benefit looks more like a boondoggle. The basic problems with the drug benefit measure -- among them cost, complexity, favors to private insurers and failure to reduce U.S. pharmaceutical prices -- won’t be fixed in an election year. The Senate could, however, take a practical step to reduce drug costs by refusing to confirm Mark McClellan, President Bush’s nominee to run Medicare and Medicaid, until McClellan ends his resistance to U.S. purchases from Canada of drugs made or licensed by U.S. manufacturers.

In his current position as head of the Food and Drug Administration, McClellan has been the administration’s most vocal opponent of reimportation from Canada, where prescription drugs are bought from manufacturers by the government and sold at much cheaper prices than in the U.S. He helped design the administration’s new $138-million program to prevent prescription drugs from being “diverted” by, among other things, cracking down on Canadian Internet pharmacies. He has threatened legal action against state and local governments that try to buy drugs in Canada, pressured health insurers to reject reimbursement claims for Canadian drugs and even tried to enlist UPS and FedEx to stop cross-border purchasing. As Sen. John McCain (R-Ariz.) has aridly pointed out, Canada is no “Third World, poverty-stricken, unregulated nation to our north.” Canada, in fact, has a tops-in-the-world drug safety record.

At McClellan’s confirmation, senators should press him to reverse his opposition to reimportation and certainly ask him why he is spending $138 million busting online pharmacies that sell drugs to seniors rather than using the money to beef up oversight of those pharmacies.

As head of Medicare and Medicaid, McClellan couldn’t single-handedly allow reimportation of drugs. That is still a matter for Congress. But he wields great influence and would be able to halt reimportation by, for instance, declaring such drugs unsafe or by cutting off Medicare and Medicaid benefits to states such as Wisconsin and Minnesota that help provide access to Canadian pharmacies.

Drug reimportation is only a small step toward lowering outrageously high U.S. drug prices, but it’s the least that legislators can press McClellan to support.