Take it or leave it.
* the combinations of the factors above will put pressure on the pharmaceutical companies to expand geographically as quickly as possible, in order to maximize their chances of recovering their R&D costs and making a fair profit within the time period covered by patent protection. In order to do that, they will accept in some countries prices that are far from ideal -- prices they would never accept in a true monopoly situation. In doing so, they open the gates for grey trade -- re-importation and parallel imports.
* the barrier to grey trade is formed by the combination of several factors:
* Price difference
* Trade Tariffs (where applicable)
* Cost of transport
* Regulatory considerations
At an annual treatment cost of 10,000 USD, and the same drug is sold in Canada at a price 10% lower, then re-importation is likely to occur. In the absence of trade tariffs and with a transportation cost of maximum 2%, a grey trader has an 8% trading margin to cover selling & operational costs and retain a profit. The product is likely to have been kept in Canada in the same conditions as required by U.S. laws (e.g. temperature controlled and recorded the entire time, etc.). Therefore a U.S. pharmacy can safely buy it and sell it forward to its patients.
* There may be a further limitation regarding reimbursement -- e.g. If the U.S. government only reimburses to
