2 chains urge OK for drug imports

The nation's two largest chain drugstores, CVS and Walgreens, launched a challenge to the nation's drug manufacturers yesterday by calling on the Bush administration to develop a legal, safe channel for Americans to buy imported drugs.

CVS Corp.'s Tom Ryan, chairman and chief executive of the Rhode Island company, led the way with an unexpected and dramatic appeal for drug importation at a Washington meeting of an administration task force on the issue.

Walgreen Co., asked by the Globe for reaction to Ryan's remarks, said it has been studying the question for two years and for the first time publicly stated its support of imports.

The large pharmacy chains had until yesterday sat quietly on the sidelines as Americans without prescription insurance have ordered increasing volumes of medicine from Canada and, more recently, from Europe. Drugs from those areas are often identical to prescriptions available in the United States, but they are 20 to 80 percent cheaper because of foreign price controls. They are illegal to import under laws intended to safeguard the US medical supply chain.

Efforts to make the practice legal are underway in Congress, amid signs of a softening by the administration. On Tuesday Health and Human Services Secretary Tommy Thompson said he expects Congress to pass an importation bill and added that he would not urge President Bush to veto it.

Ryan jumped into the debate when he outlined a possible system of legal drug importation during his testimony. He said domestic wholesalers and drugstores should be permitted to import drugs from Canada and other foreign countries and then distribute them, giving priority to the elderly and others who lack prescription drug coverage.

"To do otherwise," he said, "would be to ignore the millions of Americans who, as we speak, are forced to go outside our existing system, which is intended to ensure drug safety, in order to preserve their pocketbook."

In a telephone interview after his testimony, Ryan said he was responding to huge disparities in international drug pricing, as well as to simple customer demand.

"Our pharmacists are being bombarded with questions about why they can't import from Canada," he said. "We have a situation that's working in the shadows because people can't afford their medications. I would like to see the government get in front of it and ensure that drugs are safe and effective."

Ryan said such a government action would force the drug industry to lower its US prices. He called it a short-term solution that could help to bring longer-term change. "It would bring it to a head, and I think the industry would have to address this problem," he said.

"States are having trouble balancing their budgets, and they are trying to limit prescriptions people can get, and it's all because of the cost of prescriptions," he said. "This is one way to begin to mitigate that cost." CVS would not seek to make additional profits with lower-cost imports, he said. Instead, he said, it would pass those savings directly to consumers.

Ryan added that lobbyists for CVS had already begun meeting with officials in Washington, including members of the Senate who are sponsoring a bipartisan bill to legalize drug importation.

Walgreen Co. spokeswoman Laurie Meyer said the company also supports importation if a safe channel can be established. "If importation is legalized, we will actively participate in filling prescriptions for patients," she said. "It's a way to provide some relief to what we see every day in our pharmacies."

Using American pharmacies as a channel for imports would involve pharmacists in patient care, which is missing from the current, illegal system, she said.

When its purchase of half of Florida-based Eckerd Corp. stores closes next month, CVS will have more than 5,000 US retail locations. Walgreen, based in Deerfield, Ill., has 4,300 stores.

The pharmaceutical industry's Washington-based lobbying group, the Pharmaceutical Research and Manufacturers of America, responded negatively to the move by CVS and Walgreen, repeating its assertion that imports are risky.

"Its unfortunate that some want to lower the premier American safety standards and bring in drugs from Canada despite the safety concerns of nearly all pharmacies and pharmacists," said spokeswoman Wanda Moebius. "Doing so can only open the floodgates to counterfeit drugs entering the US drug supply."

Despite their repeated warnings, government officials have not attributed any deaths or injuries to drugs shipped from Canada. Canadian officials have said there are virtually no cases of counterfeiting in that country, while the US supply chain has been tainted on a number of high-profile occasions.

Meanwhile, in an election year, when the sentiment of older voters could prove crucial to the political fortunes of Democrats and Republicans, the mood in Washington appears to be shifting in favor of imports. On Tuesday, Thompson was asked if he would urge Bush to veto a drug-importation bill, and he responded that he would not.

Yesterday, Thompson's staff attempted to back off from the secretary's statement, saying Thompson had not been talking about any particular bill and that ensuring safety of imports remains a formidable obstacle.

Christopher Rowland can be reached at crowland@globe.com.