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Hatch wins a round in fight against pharmaceutical companies
by Tom Scheck, Minnesota Public Radio
May 10, 2004

Attorney General Mike Hatch says he wants the documents to determine if officials with Glaxo worked with any other drug company to cut off drug supplies to Canada. (MPR Photo/Tom Scheck)

Minnesota Attorney General Mike Hatch is celebrating a ruling that forces the drug company GlaxoSmithKline to produce all documents related to the importation of prescription drugs. Hatch says the documents will show whether Glaxo and other major pharmaceutical companies are conspiring to block the importation of prescription drugs from Canada in retaliation for cross border drug sales.

St. Paul, Minn. — Hennepin County District Court Judge Peter Albrecht ordered Glaxo executives to produce any correspondence between Glaxo and other drug company executives, the Food and Drug Administration, company lobbyists and any pharmaceutical trade organizations. The judge also ordered GlaxoSmithKline to report any meetings that took place about drug reimportation and produce documents it sent to Canadian pharmacies over reimportation.

Hatch says he wants the documents to determine if officials with Glaxo worked with any other drug company to cut off drug supplies to Canada.

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Five companies have cut drug shipments to Canadian wholesalers that sell drugs back to U.S. consumers. They cite safety concerns, but some say the move has more to do with profits. Drugs in Canada are less expensive because of government price controls.

Hatch says it's a violation of the state's anti-trust laws if drug company executives agreed to limit sales to Canada.

"If you're shorting these people as a means of discipline, saying 'if you continue your sales to Americans, by God, we're not going to sell you any more drugs, or we'll only sell you the number of drugs that you could sell in the past to Canadians,' our position is that's a boycott and it's illegal, and not only do we want an injunction, but everyday that this goes on to the degree that we can show some damages sustained by Americans, we'll want the maximum. We'll want some penalties," Hatch said.

The ruling means the attorney general's office could get a peek at Glaxo's internal and external documents from the United Kingdom and Canada. But it could be a long wait and may never happen.

Nancy Pekarek, with Glaxo's U.S. office in Philadelphia, says they'll appeal the ruling. Pekarek says Glaxo executives acted independently to limit drug shipments to Canada. She says Glaxo is working with the U.S. Food and Drug Administration to ensure that the illegal activity of cross-border sales does not happen.

"They're as shorthanded as everyone else is and don't have the ability to inspect every package that comes across the border. But GlaxoSmithKline Canada does have the right to protect the supply of medicines within Canada for Canadian citizens and that's the action that they took," she said.

In his ruling, Judge Albrecht disagreed. He says it's the FDA which is supposed to enforce the law, not GlaxoSmithKline.

The issue of reimportation has been a hot topic as seniors and other struggle with high drug costs. Minnesota is one of a handful of states that are helping its citizens import drugs from Canada.

Amy McDonough, with the Minnesota chapter of the AARP, says she hopes the action will prompt lower drug prices for seniors.

"It's another step towards opening the books and trying to find out why these drug prices are so high and what we can do as consumers to buck that trend," she said. Hatch says he doesn't intend to take similar action against other drug companies. He says he hopes attorneys general in other states will take action against against Pfizer, Eli Lilly, Merck and Astra Zeneca.

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