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Plan For Cheaper Prescription Drugs Stalled

Prescription drugs are so much cheaper in Canada than at home that American retirees have been organizing bus trips across the border to bargain shop for pills.

Just before the election, Congress passed a law to let U.S. pharmacy companies do the same kind of bargain hunting on a major scale by buying and re-importing American-made drugs sold to foreign countries.

But Secretary of Health Donna Shalala, in a letter to the President, has now scuttled the plan by citing "serious flaws and loopholes" which "undermine the potential for cost savings."

"Since she couldn't certify that American consumers wouldn't get lower prices, she didn't want to hold out false hope and be involved in something she thought was not legitimate," Clinton says.

Opposition by the drug companies weakened the Clinton plan, and Shalala said it gave drugmakers too many avenues to keep prices up. Still, many in Congress thought it deserved a try.

"I think it's a wrongheaded decision. I think it lets the drug industry off the hook, and we will have to find a way to respond to this appropriately," says Sen. Byron Dorgan (D-ND).

Dorgan noted that common drugs like Zocor are cheaper in foreign countries, where prices are controlled by government.

"In Canada it costs $1.82 per tablet. In the US, $3.82 per tablet. Same pill, same bottle, same company," he says.

Clinton said he plans to suggest changes to Congress that would make drug re-importing acceptable. But with a new occupant coming to this House--one who favored the rejected plan--it's likely Congress will leave the next move to the Bush administration.

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