By Javad Heydary E-Commerce Times Part of the ECT News Network
02/17/05 5:00 AM PT
A side effect of such use of RFID would be that the pharmaceutical industry could seriously undermine the movement of products across jurisdictions where there is a discrepancy between prices for prescription drugs, such as is the case in the U.S. and Canada.
In recent months, the pharmaceutical industry has stepped up its fight against online pharmacies on three fronts: First, it is strongly lobbying governments on all sides including those of the U.S. and Canada; second, it is teaming up with companies in other industries to mount indirect campaigns against online pharmacies; and third, it is exploring technology to counter the movement of pharmaceutical products across borders that forms the backbone of the online pharmaceutical industry.
On the lobbying front, the U.S. pharmaceutical industry recently mounted a multi-million dollar campaign to prevent importation of prescription drugs from Canada. Included in this campaign has been the enlistment of a former U.S. ambassador to Canada, Gordon Giffin, who has lobbied Canada's various health-related government agencies on behalf of the Pharmaceutical Research and Manufacturers of America, the main trade industry association for the pharmaceutical industry in the U.S.
Lawsuits Filed
Some reports have gone as far as stating that the U.S. President himself lobbied the Canadian Prime Minister on his last visit to Canada. Whether accurate or not, the industry lobbying seems to be having some effect in that authorities in Canada are considering new restrictions on Internet pharmacies.
On a second front, Pfizer, the largest pharmaceutical company in the world, recently teamed up with Microsoft (Nasdaq: MSFT), whereby the companies filed several lawsuits against Internet pharmacies and spammers.
Although most of the defendants were targeted by only one lawsuit, two online sites, namely CanadianPharmacy and E-PharmacyDirect, were the subject of lawsuits by both companies.
In its lawsuits, Pfizer states its concerns about the safety of the advertised products and alleges that the defendants are selling unapproved drugs, namely Viagra, to U.S. citizens. On the other hand, Microsoft's lawsuits are more concerned with the defendants' use of spam as a method of advertising.
Lawyers for both Microsoft and Pfizer admit that the evidence is inconclusive as to whether the operations are even based in Canada. However, as has been common place in similar lawsuits, the suits have been filed against unnamed defendants.
RFID Technology
This standard practice in fighting spammers allows the plaintiff to subpoena records from credit card companies and ISPs to determine the identity of the spammers and drug merchants.
Aaron Kornblaum, the lawyer for Microsoft, has indicated that spam messages were traced back to a network of mailers. In addition, he suggested that the connection to the online pharmacies in Canada was tenuous as the drugs appeared to be manufactured in India and shipped to buyers in the United States.
Although the evidence linking these two online drug merchants to Canadian online pharmacies is thin, there are indications that the operators of the CanadianPharmacy site are situated in Montreal, Quebec.
On a third front, a number of pharmaceutical companies are seriously exploring the use of radio frequency identification (RFID) technology to track and control the movement of prescription drugs. The public reasons being given for using this technology are the usual ones, such as improvements in quality control, supply chain management and customer service.
However, a side effect of such use of RFID would be that the pharmaceutical industry could seriously undermine the movement of products across jurisdictions where there is a discrepancy between prices for prescription drugs, such as is the case in the U.S. and Canada.
These efforts by the pharmaceutical industry seem to be in response to a growing trend to accept and regulate online pharmacies in a number of jurisdictions.
New Regulations
For example, in Manitoba, the province in Canada where most Canadian online pharmacies are based, the Manitoba Pharmaceutical Association is planning to amend its regulations in order to accommodate and regulate Internet pharmacies, following discussions between the regulator and Canada's largest provincial group of online pharmacies. The anticipated amendments would implement stricter standards for Internet pharmacies and exempt them from the requirement that a Canadian doctor see a patient before writing a prescription.
In the U.K., the English government has approved the operation of Internet-only pharmacies in principle, without the requirement of the existence of a physical pharmacy.
These recent efforts by the pharmaceutical industry can be interpreted in one of two ways: either the industry has finally seen the light that online pharmacies are here to stay and, as such, it has decided to contribute in a meaningful manner by getting involved in the regulation of online pharmacies; or that it is mounting a final fight to achieve its untenable objective of destroying cross-border online pharmacies.
Most likely, the industry is motivated by the latter but acutely cognizant of the former.
Javad Heydary, an E-Commerce Times columnist, is a Toronto lawyer licensed to practice in both Ontario and New York and is the managing editor of Lawsof.com.
The Integrated E-Shopping Experience February 14, 2005
Online advertisers can target the right promotion, for the right product, at the right price, at the right time, to the right customer. More traditional advertising dollars will enter the online ad market as the potential for much greater revenue increases.
Internet Marketing, Privacy Survey Finds Relevancy the Key February 01, 2005
Most online transactions involve getting the consumer to provide as much information as possible on the request form. However, consumers are not willing to provide all the requested details. The study showed that 84 percent of the respondents want more control over the details they provide as a condition of completing an online transaction.
Sun Microsystems' Mike Green Analyzes E-Commerce in 2005 January 31, 2005
Mike Green, vice president of retail industry for Sun Microsystems, believes that retailers who have made smarter technology investments in four key areas -- lead-time optimization, supply chain management, mark down optimization and labor force management -- will likely have an advantage over their competitors.
Online Retailers Learned Valuable E-Lessons in 2004 January 24, 2005
Gartner analyst Adam Sarner told the E-Commerce Times that multichannel retailers learned that e-commerce doesn't necessarily mean a transaction in an online shopping cart. "J. Crew knows that someone going to jcrew.com is 27 percent more likely to visit a J. Crew store soon afterwards," Sarner said. "The Web is a powerful influence."
Related News Alerts
More by Javad Heydary
US Online Gambling Laws and Foreign Nationals: Pushing the Limits August 25, 2009
Under the Unlawful Internet Gambling Enforcement Act, U.S. financial institutions aren't allowed to transfer money to offshore gambling sites. However, some recent examples have raised questions over how far the law's boundaries extend.
Tweeting From the Courtroom July 21, 2009
The days of sketch artists furiously scribbling on their pads to share the drama of a trial are long gone. Now, some judges are allowing the hum of keytaps to accompany proceedings as reporters and citizen observers churn out real-time tweets that give the world a blow-by-blow narrative, 140 characters at a time.
Employers, Employees and Independent Contractors - Who Owns the Copyright? March 24, 2009
Whether an individual is labeled an "employee" or an "independent contractor" may not carry much weight in determining the outcome of a legal dispute over copyrights. What's crucial to such arguments is the nature of the working relationship, not the label. To avoid the costs that often accompany such wrangling, it's best to establish copyright ownership before a project gets off the ground.
Headline Feeds
Talkback: 
