The role the government plays in the regulation and pricing of American pharmaceutical products is not a particularly active one. In fact, it practices one of the most hands-off approaches to the domestic marketing of prescription drugs of any comparable nation with an advanced healthcare system. It is this approach that leads to some of the highest prices for prescription drugs among developed Western nations. In the way of rough figures, American prescription drugs cost around 2.5 times more than the average across these countries.
Whereas countries like Canada practice price capping of pharmaceuticals for the domestic market, the American government does pretty much nothing when it comes to marketing and pricing, allowing pharmaceuticals companies to set the price. They set it high, citing the argument that lower prices lead to less funding for innovation and research.
Enter the FDA
This is not to say that American authorities facilitate a wild west style prescription drug policy. Where the government does play a more active role is through the Food and Drug Administration (the FDA), which ensures that drugs are safe, effective, and correctly labelled. The FDA runs a tight ship and, if approved, consumers can be guaranteed that their prescription and over-the-counter medications meet the most exacting standards of quality.
But this does nothing to affect the prices American consumers (both individuals and private/public enterprises) are forced to pay. And that 250% average markup has become one of the thorniest issues in American politics – as well as a perversely paradoxical one. There is actually a broad bi-partisan agreement in American politics that drug prices are too high. And yet, despite this, there seems to be no agreement on what to do about it, and the situation doesn’t, at present seem to be improving at all.
It is for this reason that many Americans are – and have been for years – turning to Canadian online pharmacies in order to source Canadian drugs for as much 70% cheaper than the same drugs cost in the U.S. Online pharmacies such as Canadian Pharmacy cater to a large and growing American market.
The most fascinating thing about this phenomenon is that there has arisen a sort of tacit acceptance of this practice on the part of the most prominent American authorities. So much so, in fact, that entities as large and significant as municipal authorities, private companies, and even state governments are engaging in the practice as well. Then President Donald Trump even gave official sanction, in 2020, to state governments to import Canadian drugs wholesale. And the FDA, as it turns out, has actually been responsible for giving real legitimacy to the operation of Canadian online pharmacies in the U.S.
It does this in two ways. Firstly, the FDA officially recognized, in 2016, that the Canadian CFIA (which regulates the safety if Canadian drugs) operates to a set of standards that is equivalent to those in the U.S. This means that consumers can buy Canadian drugs and be assured that they are just as safe as any they would buy in the States.
But beyond even this, the FDA also published a so-called “final rule” regarding the importation of Canadian drugs. This statement gives approval to official (often state level) programs that import drugs to America in order to answer the popular desire to do something about American drug prices (without changing the American situation at all).
Given that the FDA has at times looked askance at the practice of importing foreign medication, it is perhaps a happy irony that it now seems to have given the practice its official sanction.