Chain Drug Review - With generics, prices are often cheaper in U.S. than Canada
WASHINGTON — Generic drugs in the United States often cost less than both Canadian brand name drugs and Canadian generic medications, according to a Food and Drug Administration study.
Earlier this year agency analysts examined the seven largest-selling generic prescription drugs for chronic conditions that have been available as generics in this country since 1993.
Those products are: alprazolam (Xanax), anxiety and panic disorders; clonazepam (Klonopin), seizure and panic disorders; enalapril (Vasotec), high blood pressure; fluoxetine (Prozac), depression, obsessive-compulsive disorder, panic disorder and bulimia nervosa; lisinopril (Zetril and Prinivil), high blood pressure and heart failure; metformin (Glucophage), type 2 diabetes; and metoprolol (Lopressor), high blood pressure, angina and heart failure.
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For six of the seven the U.S. generics were priced below the Canadian brand name versions. Five of the seven U.S. generic drugs were also less expensive than the Canadian generics.
Of the remaining two U.S. generic drugs, enalapril was unavailable as a generic in Canada and its brand name version in that country was over five times the price of the U.S. generic equivalent.
Metformin, the other U.S. generic, sold for less in Canada both as a generic and as a brand name. But, point out economists who conducted the research, metformin did not debut as a U.S. generic until January 2002, so its price as a generic has probably not dropped to the level it will eventually reach.
The study compared the average price of the generic and brand name version of the seven drugs sold in the U.S. and Canada by calculating the price per milligram of active ingredients in U.S. dollars. (Prices in Canada were converted to prices in U.S. dollars using a 2002 exchange rate.)
The prices were the costs to retailers, and the study used the assumption that retail markups were the same in both countries. Pricing information was collected by market research company IMS Health.
“Advocates of legalizing imports of drugs from Canada and other countries have typically cited studies showing that brand name drugs are much cheaper abroad than in the United States,” states the FDA.
“These studies ignore how competition in the U.S. market lowers generic drug prices so they are lower than drug prices abroad.”
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