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A BAD DEAL
PHARMACEUTICAL INDUSTRY GETS RIGHT TO KEEP DRUG PRICES HIGH HERE AND IN AUSTRALIA

Question: Just how far is the Bush administration and Congress prepared to go to protect the profits of the pharmaceutical industry, even at the expense of making prescription drugs more expensive for the American public?

Answer: Australia.

Tucked away in a free-trade agreement with Australia is a provision that would bar the reimportation of U.S. manufactured drugs from Australia, where they are significantly cheaper than in Canada. That's right, Canada, where U.S. manufactured drugs already cost far less than in America. For example, a 30-day supply of the cholesterol-lowering drug Zocor costs about $120 in the United States, $60 in Canada and $39 in Australia, said Kevin Outterson, associate law professor at West Virginia University and an expert on the issue of drug reimportation. In addition, this agreement would allow the pharmaceutical industry to challenge decisions by Australia about what drugs could be covered by that country's health plan and their prices.

After the House passed the agreement, the Senate followed suit with overwhelming approval Thursday night. Not content with making Americans pay top dollar for their medication, the pharmaceutical industry now has gotten the help of the administration and Congress to make drugs more expensive for Australians.

Calling that an outrage is an exercise in understatement.

There is no problem with the trade aspects of this deal. U.S. manufacturers and service providers like telecoms and financial institutions will get greater access to Australian markets. The United States, in turn, is going to practically eliminate duties on Australian exports. The estimated value of that for Australian business -- more than $3 billion -- would make up for the extra $1 billion Australians now will have to pay for prescription drugs.

But there is no upside for millions of Americans who are without health insurance and can barely -- if at all afford prescription drugs.

The trade agreement also, incredibly, has a provision that could drive up the price that Medicare Part B pays for drugs, Outterson said. "We went to Australia and said, 'Please, tie our hands.' "

This is not a question of free trade. It is a question of ignoring the public good to placate the pharmaceutical industry, which has made $60 million in political contributions, primarily to Republicans, over the past three years. Similar language in other trade agreements, notably with Canada, could preclude reimportation of American manufactured drugs even if a law was passed allowing such imports, said Sen. Charles Schumer, a strong proponent of drug reimportation from Canada.

The administration pushed through a prescription drug program through Medicare, which is expected to cost the government $534 billion over 10 years. It could have helped reduce the price of prescription medication by allowing reimportation, which would have cost the taxpayer nothing. Instead, it has chosen to protect the pharmaceutical industry.

When this administration tells you it's not tilted toward big business at the expense of the average American, think about this abominable treaty.

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