Drug giant GlaxoSmithKline Inc. is following through on an ultimatum to stop selling prescription drugs to wholesalers and pharmacies that ship its products to consumers outside of Canada.
Citing the interests of patients and their safety, the company said it "understands the concerns of Americans without prescription drug coverage but believes that ordering medicines over the Internet from Canada or other countries is not the answer and puts patients at risk."
GlaxoSmithKline's decision yesterday afternoon perplexed several Internet medicine executives, who were told by a GlaxoSmithKline official on Monday that yesterday's deadline to halt shipments would not be enforced.
"I confirmed with two other wholesalers that they also received a call from Glaxo and were told that it was business as usual and that supplies would continue until further notice," said Laurie Gauthier, owner of drug wholesaler Prairie Supply Co-operative of Calgary.
"I really don't know what's happening," he added.
Alison Steeves, a spokeswoman for Mississauga-based GlaxoSmithKline, admitted there was some "miscommunication with our distributors" but said the company "was beginning the process of implementing" the ban against firms that make cross-border shipments.
GlaxoSmithKline "continues to speak with a number of key stakeholders regarding Internet pharmacies and their export of our medications that are approved for use only in Canada.
"We are currently working on implementing a process that will allow us to maintain a continuity of supply of medicines for Canadian patients."
In mid-January, GlaxoSmithKline cited a list of regulatory, supply, safety and transportation issues for its warning and suggested that filling American prescriptions from Canada could violate certain of its patent rights and risk possible lawsuits in the United States.
But industry sources figure the multinational's action is being motivated by a loss of sales on higher margin pharmaceuticals sold in the United States by its U.S. subsidiary.
John Graham, who has written on drug pricing for the Vancouver-based Fraser Institute, said it's all about money and the failure of the United States to control soaring drug costs for seniors and the poor.
"The real goal here is to preserve the American profit margins."
An estimated one million Americans are now spending about $1-billion a year to obtain drugs at savings of 20 to 80 per cent through Canadian on-line pharmacies thanks to a favourable exchange rate, as well as the provincial controls on keeping drug costs down.
The Manitoba International Pharmacists Association has threatened to sue GlaxoSmithKline if it institutes a sales ban.
Association president Kris Thorkelson said his group has retained a lawyer and its members are prepared to contribute $1-million to cover legal costs.
A spokesman for Manitoba Industry Minister MaryAnn Mihychuk, a strong supporter of Internet pharmacies, said the province was "frustrated with the difficulty of getting a clear position from GlaxoSmithKline.
"They appear to be reversing their position [of Monday]and that's unfortunate."
Mr. Gauthier, who opposed the original threat from GlaxoSmithKline, said he was concerned the drug company was shifting its arguments from safety for American consumers to a guaranteed supply for Canadian consumers.
"That tells me Glaxo will not increase its overall shipments into Canada and its production in Canada to meet higher Canadian demand coming from Americans shopping at Canadian Internet pharmacies."