Y - Pharmaceutical R&D Jeopardized in the EU - Fraser Forum

But remember that core principle of the free movement of goods? Welcome to the world of the parallel trader, who, thanks to what is theoretically the single market—but, in practice, is 15 warped markets—is able to export the drug from the country that sells it for £10, and sell it in the country which sells it for £15, making an instant profit for doing nothing but piling as much as he can into hi. [...] The Cecchini Report, which preceded the official launch of the Single Market in 1992, had assumed that parallel trade in F e b r u a r y 2 0 0 3 | 17 Pharmaceutical R&D Jeopardized in the EU Stephen Pollard is a senior fellow at the Centre for the New Europe, a Brussels-based think tank, and the editor of www.cnehealth.org, where his report, Saving the European Pharmaceutical Industry, can be down. [...] This is a some- what bizarre interpretation of the free movement principle, since the primary cause of the wild variations in prices, which enables parallel traders to make a profit, is the price regulating systems of the various member states, and which is essentially a legislative barrier against competition. [...] The effect of parallel trade is thus to make the EU a less attractive market— and thus a less attractive base for research-driven companies, as evidenced already by the flight of pharmaceutical companies from the EU to the US. [...] It thereby provides precisely the oppor- tunity sought by the Commission to improve the competitiveness of the pharmaceutical industry in Europe, and thus to help to improve public health and benefit consumers.