The concept is called re-importation. Many prescription drugs are actually manufactured overseas, but packaged in the United States. Some are then shipped to other countries, like Canada, whose government-run single-payer system has the bargaining power to negotiate lower prices. Unlike Canada, lawmakers specifically prohibited the U.S. government from negotiating with drug companies over prices for Medicare Part D enrollees. And there’s no mandatory price control when people buy drugs through private insurance or pay out of their own pockets. So brand-name drugs typically cost more in the U.S—though U.S. consumers get a great deal on generic drugs

Dorgan’s amendment would allow pharmacies and drug wholesalers to re-import drugs. So could consumers who have a doctor’s prescription. That would help those who take multiple brand medicines or very expensive drugs the most. It also might help lower the cost of domestic drugs by forcing drugmakers to compete with prices from other countries. But the Food and Drug Administration is wary of the idea due to safety concerns and the difficulty and expense of setting up monitoring systems for re-imported drugs.

The legislation would make buying Canadian or other approved foreign drugs simpler, and sets up measures to improve the safety. But some people do it now anyway. Our Best Buy Drugs program looked into buying prescription drugs* from reputable Canadian Websites a few years ago, and found the practice to be safe if a bit difficult under current law. We also found that people taking brand name drugs could get them more cheaply from Canada than from any U.S. source. Generic drugs, on the other hand, can be a better deal here in the states. And under current law, Medicare beneficiaries with Part D coverage should stick with U.S. sources to take advantage of Medicare’s co-pays and deductibles.

To find out where you can get the best prices on prescription drugs in the U.S., see our Drugstore Comparison

—Kevin McCarthy, associate editor 

*links to PDF