[The Great RJ]

The simple reason why Canadian drugs are cheaper is that their national health plans fixes the price they will pay. The pharmaceutical companies just shift their losses on Canadian drugs to the US market. These programs if they were successful would have just further increased costs to American consumers.

[USFRIENDINVICTORIA]

You’re either totally correct, or almost right — depending on what the meaning of “losses” is.

The drug companies are still making a profit over their marginal costs of production and distribution. They are not recovering proportionate R&D costs from the Canadian market. The U.S. consumer is picking up a disproportionately large share of the tab for R&D for the Canadian market (among many others).

[instantgratification]

Wrong. The Canadian federal government buys all the drugs in bulk, so it gets a better price. Drug prices are not fixed, and vary from pharmacy to pharmacy.

Further, Canada allows generic drugs to be manufactured earlier than in the US, and generics generally are cheaper (and I do have issues with this). I think the Canadian government should ban the practice of allowing drugs to be exported. It is not in Canadians' best interests, and Americans should resolve this problem themselves.

[BlazingArizona]

The simple reason why Canadian drugs are cheaper is that their national health plans fixes the price they will pay.

There is a common misconception that Canada 'forces' pharma suppliers to lower prices. It has no such powers: Canada just buys only those drugs which are offered to it at what it deems to be a good price. This is why 57% of American-made medications are not available in Canada at all.

A related lie is that Canada threatens to invalidate the patents for overpriced drugs to produce its own supply. Actually, only developing countries get to do this (the "TRIPS Agreement"). Canada observes the same international patent laws that we do.