Why Drugs Cost So Much / The Issues '04: Why We Pay So Much for Drugs

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Actually, pharmaceutical roulette is played every day in the U.S.--with FDA-approved drugs. Each year an estimated 50,000 to 100,000 people die as a result of adverse reactions from FDA-sanctioned pharmaceutical drugs sold in America. In fact, mistakes in administering drugs, often in hospitals, are the fourth-or sixth-leading cause of death in the U.S., depending on how the cases are counted. By comparison, the risk from defective, counterfeit or mislabeled drugs from Canada is presumed but unproved by any evidence. When TIME asked a spokesman for PhRMA, the drug-industry association, if there were any cases of Canadian drug imports harming Americans, he said, "Yes, I believe there have been some. I believe FDA has some on its website." In fact, the FDA has no such record. Over and over, congressional committees have grilled FDA officials to produce evidence of Americans who were sickened or who died as a result of buying drugs at a Canadian pharmacy. At a June 2003 hearing, members of Congress quizzed William Hubbard, the FDA's associate commissioner, on the issue:

"As far as adverse events, where people have been harmed by Canadian drugs coming across the border, did you bring any of those examples for us?" asked Representative Burton of Indiana.

Hubbard: "We have very little evidence."

Later, Representative Gutknecht, the Minnesota Republican, pressed Hubbard along the same line:

"But the bottom line is, there's no evidence of anyone who has died from taking a legal drug from Canada. Isn't that a fact?"

Hubbard: "I have no evidence. That's correct."

In fact, drug-safety regulation is often stricter overseas than in the U.S. Through the 1990s, Bristol-Myers Squibb marketed its antidepressant, Serzone (its chemical name: nefazodone), with ever growing success. In a typical earnings announcement released in July 1996, Bristol-Myers, which had revenue of $19.9 billion for the 12 months ended Sept. 30, 2003, declared that "sales of central-nervous-system drugs rose, particularly on the strength of STADOL NS, an antimigraine product, and Serzone, an antidepressant treatment with a low incidence of side effects." The next year, medical studies were released claiming "Serzone to be superior to Prozac in increasing sleep efficiency and providing better sleep quality for people suffering from depression."

It wasn't until a few years later that one of Serzone's rare but decidedly significant side effects began to leak out: liver damage, sometimes requiring a transplant and in extreme cases resulting in death. Bristol-Myers announced in 2002 that it would stop selling the drug in the Netherlands and Sweden, and eventually withdrew it from all of Europe and Canada. The FDA's only response in the U.S. has been to require a black-box warning on the label, stating in part, "Cases of life-threatening hepatic failure have been reported in patients treated with Serzone." Over the past few years, the FDA has banned more than half a dozen drugs that it had earlier approved because the drugs turned out to have an unacceptable degree of fatal side effects. That was more than in the previous two decades.

WHERE LEGAL DRUGS REALLY COME FROM