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WASHINGTON - Tom Ryan, chairman, president, and c.e.o. of CVS/Pharmacy, testifying before the Department of Health and Human Services Drug Importation Task Force yesterday, called on Congress and the Administration to quickly establish a means for consumers to legally and safely import prescription drugs. To do otherwise, he said, would be to ignore the millions of Americans who are forced to go outside the existing prescription drug system in the United States, which is intended to ensure drug safety, because they cannot afford to buy drugs within the system.
"While many in our industry believe that importation is a fundamentally flawed concept and oppose it without exception, I have come to a slightly different view," Ryan said. "Simply put, there are too many patients our pharmacists never see because they cannot afford the drugs we dispense, and others who are unable to pay for a full regimen of medications because it soaks up so much of their disposable income."
For those reasons, Ryan said he supports a safe, legal system of importation that would include the bulk importation of medicines from Canada as well as other nations where safety and quality measures are similar to those in the United States and dispensed by licensed U.S. pharmacies.
Ryan added that if such a system were put in place, CVS/Pharmacy would commit to playing an active role in providing access to imported drugs to consumers who need them.
Despite his support for importation, Ryan said he believes it should be viewed only as a temporary solution. To truly address the problem of skyrocketing drug costs for Americans, the existing global pricing model, under which identical drugs to those sold in the United States often cost far less in other countries due to government price controls. "The existing underlying global pricing model simply cannot be sustained," Ryan said.
According to Ryan, the federal government and pharmaceutical companies must move the industry to a global pricing system that's fair across all countries and that's based on what the market is able to bear and the value delivered by the products. "The United States cannot bear the cost of R&D for the world," he said. "International trade negotiations are one place where the U.S. can begin to lead the way to establishing a more appropriate, market-based pricing system with our trading partners. In the longer term, the answer must be fair and equitable trade practices, and open access. We cannot allow millions of our fellow citizens to go without life-sustaining medications due to arbitrary international trade practices. We don't do it for sugar, rice, or corn; we shouldn't do it for life-saving medications."
"It is a complicated problem with neither simple explanations nor simple solutions," Ryan continued. "But this much is clear: No industry can permanently sustain a pricing system in which the cost of a product varies so radically from one country to the next, and pharmaceuticals are no exception."
CVS operates 4,187 stores in 32 states and the District of Columbia. On April 5 CVS entered into a definitive agreement under which it will acquire 1,260 Eckerd drug stores, located mainly in the southern United States, in addition to Eckerd Health Services, which includes Eckerd's mail order and pharmacy benefit management businesses. The transaction is subject to review under the Hart-Scott Rodino Act as well as other customary closing conditions, and is expected to close in June 2004. CVS has said it will close up to 250 of those stores.