The reimportation ban of 1988 greatly fuels drug company’s funds for the R&D that is necessary to continue producing new drugs. An April Congressional Budget Officer brief addressed the up-front costs of drugs by citing a recent study: “when all relevant economic costs are taken into account, including cost from unsuccessful compounds, an average $800 million in R&D spending is incurred for each internally new compound reaching the market” (Pilon). More precisely, American drug companies spend around $800 million dollars in research and development for each drug that they attempt to create and put on the market. Out of all the drugs that companies try and produce a very small amount actually make it to the market. Billions of dollars are thus wasted and spent on nothing. The only reason these drug companies stay in business is because of their high rates to consumers in America. The drug manufacture companies raise the prices in America to maximize profits. The prices abroad are cheaper because those countries do not have to pay for R&D; it is paid by the government. Also, countries overseas simply duplicate the drugs produced in America, and therefore there are no research and development costs that the country needs to pay. Many American citizens believe it is unfair that other countries sell the exact same drugs for less money. These citizens are willing to travel to other countries to purchase drugs for a cheaper price. The reimportation ban was set into place so that Americans would not buy their prescription drugs abroad for less money, thus keeping drug companies in business to pay off their R*D costs. The high prices for prescription drugs in America are mandatory because without it, drug companies would not be able support the funds of research and development for producing new drugs. Technology would not continue and the production of new drugs would end.
The Reimportation ban is necessary to regulate the safety of foreign drugs. The FDA continues to remain concerned about the importation of prescription drugs into the United States. The FDA cannot assure that the drugs imported from foreign countries are the same products approved by the FDA. Because the drugs are imported overseas the FDA cannot inspect and assure that the drugs are safe. The FDA ha found many drugs obtained from foreign sources that appear to be the same as FDA approved prescription drugs but in fact are not the same quality. The FDA has come to the conclusion that consumers are exposed to a number of risks when they purchase drugs from foreign sources or from sources that are not operated by pharmacies licensed under state pharmacy law. The drugs imported from foreign sources may be expired, subpotent, contaminated or counterfeit product, an incorrect dose, or medication unaccompanied by adequate directions for use. The labeling of foreign drugs may also not be in English and therefore be important information regarding dosage and side effects that are not available to the consumer. The drugs may not have been packaged and stored under appropriate conditions to prevent against degradation, and there is no assurance that these products were manufactured under current good, manufacturing practice standards. When consumers take such medications, they face risks of dangerous drug interactions and/or of suffering adverse events, some of which can be life threatening (Quotes). During an FDA Press Release on January 27, 2004 the FDA and the United States Customs and Border Protection (CBP) announced that their “second series of import blitz examinations found 1,728 unapproved drugs, including so-called ‘foreign versions’ of FDA approved drugs, recalled drugs, drugs requiring special storage conditions, drugs requiring close physician monitoring and drugs containing addictive controlled substances” (Quotes). These findings provide additional evidence that illegal importation of prescription drugs has serious risks. Unapproved drugs lack assurances of safety, effectiveness, quality and purity. Most importantly, in a hearing on Options for Safe and Effective Prescription Drug Importation in 2004 it was stated, “American laws were not designed to assure the safety of imported drugs. In face, Congress made it explicitly illegal in the Prescription Drug Marketing Act of 187, a strong bipartisan measure that was passed because there were unsafe prescriptions coming into the country” (Quotes). Thus, the reimportation ban should remain in place in order to secure the safety of the American people.
Proponents to abolish the reimportation ban strongly believe that free markets will produce lower costs of drugs to American consumers. However, this is a very short cited view since without the pricing power that the reimportation act provides, U.S pharmaceutical companies will not invest in R&D and in the long run the American consumer will suffer. Although in the short run eliminating the reimportation act will most likely reduce the prices of drugs currently on the market, it comes with significant risks such as quality, purity and effectiveness. Additionally, it is important not to forget that in viewing Americans welfare, it is not just the welfare of today’s society, but the welfare of future generations that would be significantly disadvantaged without the investment of R&D by American pharmaceutical companies to find new cures and remedies.
In summary, reimportation laws in the long run better benefit American citizens. The ban on importing goods from foreign countries contributes to recover the expensive research and development costs from drug companies. Without the ban, hundreds of drug companies would become bankrupt and thus there would be no way to produce new drugs and cures. The reimportation laws also help ensure the safety of all American citizens. Since the drugs are imported overseas the FDA cannot inspect and assure that the drugs are safe. The FDA reported that American consumers are exposed to a number of risks when purchasing prescription drugs from abroad. The drugs imported from foreign sources may be expired, subpotent, contaminated or counterfeit product, an incorrect dose, or medication unaccompanied by adequate directions for use.