AstraZeneca To Limit Sales of Its Drugs to Canadian Pharmacies and Wholesalers

Under a new policy, AstraZeneca has become the second major drug maker to suggest that it will limit sales to Canadian pharmacies and wholesalers that import drugs to the United States, the AP/Baltimore Sun reports. In an April 8 letter to Canadian pharmacies and wholesalers, AstraZeneca wrote that some prescription drug orders would be reduced because of a new allotment program designed to address "unexpected sales increases" (AP/Baltimore Sun, 4/22). GlaxoSmithKline said in Jan. 1 letters to Canadian pharmacies and wholesalers that market GSK treatments over the Internet to the United States and other nations that GSK would no longer sell products to companies that continue the practice after Jan. 21. GlaxoSmithKline later altered those plans and instead is asking the wholesalers and pharmacies to "self-certify" that they are not exporting the company's drugs (Kaiser Daily Health Policy Report, 2/13). Although AstraZeneca's letter is "not as direct" as GSK's letter, some analysts and advocates for the elderly say it also is intended to "choke off supply" of reimported drugs before the practice hurts U.S. drug makers' profits. Analysts predict Canada's Internet drug market will double this year to $1.4 billion, according to research firm Jupiter Research. Jupiter estimates that the $700 million in reimported drugs purchased last year cut profits for American drug companies by $1.3 billion, or about 1% of the U.S. retail pharmaceutical market.

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Rachel Bloom Baglin, an AstraZeneca spokesperson, said the new policy is intended to ensure the increased sales are not affecting access for Canadian citizens and that "historical purchasing patterns" are not used to determine allocation. However, Bloom Baglin added that if AstraZeneca discovered drug reimportation was the reason for a company's increased sales, supply would be limited to that company. "We can't condone illegal activity," Bloom Baglin said. Rep. Bernard Sanders (I-Vt.), who introduced a bill (HR 847) earlier this year designed to protect access to drugs imported from Canada, said, "Clearly, the pharmaceutical industry, which is one of the greediest in the States, wants to maintain their profitability." Some Canadian Internet pharmacy executives contend that their businesses do not cut into profits for American drug companies. "If people weren't buying from me, they wouldn't be buying," Dave Robertson, president of crossborderpharmacy.com, said (AP/Baltimore Sun, 4/22).