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The War on Online Drugs

Mises Daily: Thursday, December 30, 1999 by

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The Clinton administration wasn’t content with blowing up a pharmacy in the Sudan; now it wants to blow up hundreds of them on the web. The plan is to give the Food and Drug Administration massive new investigative powers to hamper online sales of prescription drugs. The proposed legislation would impose penalties of half a million dollars per item sold without federal permission, give the FDA $10 million and 100 new employees to vet all websites, and generally nationalize state laws that make unapproved pharmacies illegal.

By way of background, the feds have been seeking some way to sink their claws into Internet commerce, taxing it, regulating it, and generally preventing it from outcompeting their pals in the bricks-and-mortar world. They first promised to crack down on smut (this from the moral exemplars at the Justice Department), then hate (since bureaucrats are so filled with love for all), then smears against politicians (recall Hillary’s complaint that the web has no "gatekeepers"). Now, the feds say the web makes prescription drugs too accessible to those who want them.

The basis of the crackdown is a study from the University of Pennsylvania that concludes, in the words of the New York Times, that it is "alarmingly easy for consumers to get prescription drugs without seeing a physician or a pharmacist."

Imagine that! Consumers, who are not alarmed, are getting what they want without jumping through various government-approved hoops. So the answer is to cartelize all online pharmacies and bring them under federal control, and later to use this precedent as a basis for regulating any type of web commerce that the regulators don’t like.

But while everyone agrees that bad stuff is made available on the web, just as in the offline world, what could possibly be wrong with sites that make medicines easily accessible? The answer is provided by the Pennsylvania study: physicians and pharmacists don’t like it. Contrary to popular wisdom, the FDA is not an independent agency; it does the bidding of the most powerful people in the pharmaceutical industry, which has worked hand-in-glove with government regulators for more than a century.

Think about the absurdity of the prescription business as it presently exists. There are thousands of books detailing the uses and effects of every drug on the market, and thousands of volumes making information on health accessible to everyone. Why do we need "licensed pharmacists" to dispense drugs only on the authority of "licensed physicians"? Why do we need a guy in a white coat standing behind a counter pouring pills from one bottle to another and charging us for the service, after we have paid another guy in a white coat a fee for cooling our heels in his appropriately named waiting room?

The traditional claim is that the iron triangle of regulators, doctors, and pharmacists is necessary to protect our health and safety. But who could possibly be more interested in health and safety than the well-informed consumer? We medicate ourselves with every manner of cough syrup, pain killer, and skin cream. Why can't people also purchase codeine or viagra or antibiotics on their own authority?

The answer is that prescriptions, and the doctors’ visits they require, are the bread and butter of the medical industry. That is, the iron triangle is a racket cooked up to insure the incomes and privileged positions of a professional cartel. The web is a threat, not to our health, but to the bank accounts of the cartel members.

The practice of regulating medicine began in the 19th century as an effort by mainstream doctors to drive competing homeopaths out of business. Moreover, the impetus behind the initial regulation of medical schools was to limit the number of doctors, creating an artificial shortage and driving up the price of their services.

The proposed crackdown on online pharmacies is merely a continuation of that process, and an attempt to relieve new competitive pressures. But there is a problem that the feds don’t know how to deal with. If they successfully shut down rogue pharmacies in America, they still have to deal with thousands of suppliers in other countries, many of which provide drugs the FDA has not put through its 17-year obstacle course. Unless the Postal Service is prepared to open and inspect every package coming from abroad, the pent-up demand for effective pharmaceuticals will be met in other ways.

The vast majority of online drug sites are operating in full accordance with the law, requiring verifiable prescriptions from doctors and complying with tens of thousands of state-level regulations. But let’s say they did not, and instead simply sold drugs to consumers using the one-click method. What would be the result?

For one thing, consumers would have to decide whether to make an appointment with the doctor or not. No more taking time from work to read old copies of Reader’s Digest just to receive permission to acquire what we know we need anyway. Doctors would have to persuade us to use their drug-advice services, and not coerce us into using them by force of law. That would in turn impose new educational burdens on the consumer: we would have to become more informed about medicines and health. Wouldn’t that be a good thing?

It is by now a cliche that technology is breaking down old barriers that the nation state has tried for centuries to set up. The war between online pharmacies and FDA regulators is a microcosm of the larger struggle between the future of liberty online, and the oppression of old-guard regulations.

The side of liberty will continue to face setbacks, but at the present pace of technological change, there is every reason to be optimistic about a long-run victory. If the web can scare the daylights out of cartels as entrenched as the medical industry, we are making serious progress. Hence, the upside of the Clinton administration’s campaign: like its war on guns, it has alerted consumers to the prospect of regulation, and given them all the more reason to get online and get the drugs they need sooner rather than later.

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Llewellyn H. Rockwell, Jr., is president of the Ludwig von Mises Institute in Auburn, Alabama. He also edits a daily news site, LewRockwell.com