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U.S. Pharmaceutical Sector Extending an Outmoded, Dysfunctional Pricing System to Cyberspace

We recently wrote in response to how LegitScript is painting inaccuracies about the Canadian International Pharmacy Association (”CIPA”). With our members’ 100% perfect safety record selling life-saving medications to millions of Americans for over 15 years, we are proud to participate in a regulated industry. We are also confident in the affordable solution we provide for consumers struggling with outrageous medication prices in the U.S.

Given this affordable solution to predatory pricing, it is evident that LegitScript’s dissemination of inaccuracies is part of a broader pattern of actions that closely parallel those of the U.S. pharmaceutical sector to extend an outmoded and dysfunctional pricing system to cyberspace. This includes misrepresenting CIPA’s role in the Healthy Domains Initiative (”HDI”) and operation of the .Pharmacy gTLD in a manner that is not only contrary to the Internet Corporation for Assigned Names and Numbers’ (”ICANN’s”) Bylaws and mission statement, but elevates the protection of profits over consumer interests. (See an earlier piece here on CircleID by Jeremy Malcolm, Senior Global Policy Analyst, Electronic Frontier Foundation and Mitch Stoltz, Senior Staff Attorney, Electronic Frontier Foundation.)

The Truth About HDI

For the record, CIPA advised the Domain Name Association (”DNA”) after it invited non-member input in 2016 that we would be happy to participate in HDI and to contribute to its online pharmacy initiative. Like many other non-members, we were ultimately disappointed to learn that DNA unveiled the HDI without asking for our input.

To date, we have taken no position regarding the HDI’s Rogue Pharmacy Abuse Report Proposal (the “Proposal”) because the information released by DNA has failed to provide sufficient details regarding the actual operation of its envisioned system for verifying the legitimacy of online pharmacies. We remain ready to work with DNA to refine the Proposal in a manner that both protects and benefits consumers seeking safe, authentic, and affordable medications via the Internet. In fact, CIPA recognizes the mischief of what are truly “rogue” online pharmacies, which prompted us to track misuse of our respected Certification trademark. For many years, we have worked directly with the Canadian Anti-Fraud Centre, a collaboration of the Ontario Provincial Police and the Royal Canadian Mounted Police, in order to take down those websites using our Certification trademark without authorization. In addition, we aggressively monitor use of our Certification trademark and pursue legal action against its unauthorized use.

Contrary to LegitScript’s view that we do not like private companies developing and implementing reasonable policies that remove the incentive for governments to regulate, we actually support and enforce self-regulation, and voluntarily coordinate with law enforcement to protect consumers.

.Pharmacy – Misuse of a Global Internet Resource

CIPA and the Electronic Frontier Foundation (”EFF”), an internationally recognized digital rights group based in San Francisco, are jointly concerned about private interests promulgating standards for key Internet intermediaries that are designed to serve their own financial interests. LegitScript’s ongoing efforts to tarnish the reputation of CIPA and its members appears similar to the broad pattern of actions by U.S. pharmaceutical interests to suppress competition under a false narrative of consumer protection. The most blatant example of this is the operation of the .Pharmacy gTLD by the National Association of Boards of Pharmacy (“NABP”), the trade association primarily promoting the interests of U.S. retail druggists.

The application for .Pharmacy was supported by such founding members as The National Association of Chain Drug Stores, Eli Lilly and Company, and—no surprise—LegitScript. It was approved by the Internet Corporation for Assigned Names and Numbers (”ICANN”), the California non-profit that oversees operations of the Internet’s Domain Name System (”DNS”), in March 2015.

If NABP truly wished a .Pharmacy domain registration to be indicative of regulated and safe sales of authentic medicines, then CIPA members could easily register their domain names. Despite early communications by U.S. consumer advocacy organization RxRights requesting more reasonable registration policies, NABP established .Pharmacy domain registration standards that unjustly mimic LegitScript’s “rogue pharmacy” definition. The usefulness of .Pharmacy is further diminished by an application fee that is currently $2,000.00, plus an annual recurring domain registration fee of $1,050.00.

Not surprisingly, given these facts, .Pharmacy domain registrations have been languishing. According to ICANN, in November 2016 (the most recent month for which statistics have been released) a total of only 256 domains were registered in .Pharmacy. An independent and reliable source of new gTLD registration statistics, nTLDstats.com, reports that only 211 .Pharmacy domains remain as of March 2017. Unless one believes that a handful of online pharmacies are the only ones that can provide consumers with a source of regulated, safe and authentic medications, the .Pharmacy gTLD is clearly failing at providing a safe harbor of validation for those other online pharmacies able to provide the same services, including the members of CIPA.

In an apparent effort to boost registrations of .Pharmacy domains and further limit the ability of consumers to use Internet search engines to locate safe and reliable online sources of medicines, NABP recently announced a significant change in its e-Advertiser program. That program is relied upon by Google and other major search engines as a pre-requisite for advertising against relevant medicine-related search terms.

Beginning on August 1, 2017, NABP will terminate its e-Advertiser program for verifying online pharmacies and pharmacy-related service websites. It will instead require registration of a .Pharmacy domain. In other words, unless an online pharmacy pays hefty and recurring fees to a U.S.-based retail druggist association, and can pass validation requirements that are more about price maintenance than consumer protection, it will be denied the ability to engage in commercial speech that assists consumers searching for safe and affordable medications using major global search engines.

It must be emphasized that ICANN’s Bylaws require it to maintain the openness of the DNS, and to refrain from actions that regulate (i.e., impose rules and restrictions on) services that use the Internet’s unique identifiers, or the content that such services carry or provide. Yet ICANN is standing by and permitting NABP to leverage its control of .Pharmacy, through discriminatory and self-serving policies unrelated to consumer protection, in a manner that restricts the openness of the DNS. This permits the NABP to use the unique .Pharmacy identifier to regulate available services and content, including legitimate commercial speech. Allowing such misuse of a global Internet resource is also contrary to the ICANN Board’s responsibility to reject policy recommendations that are not in the best interests of the ICANN community or ICANN itself.

CIPA plans to raise these concerns within the ICANN community as well as in other forums and organizations that seek to prevent the misuse of DNS resources to further narrow economic interests at the expense of consumer health and safety.

By Tim Smith, General Manager

Filed Under


.pharmacy is blocking the cross border access of new drugs to consumers in developing countries Mahesh Landage  –  Apr 21, 2017 9:20 AM

AS per media reports (http://timesofindia.indiatimes.com/india/india-got-only-7-of-50-global-cancer-drugs-in-5-years/articleshow/58087833.cms) Indian cancer patients got only 7 of 50 new drugs launched by big pharma in last 5 years. What are the options for them? As per Indian Drug law Indian consumer can legally import unapproved drug for personal consumption from abroad if the drug is not launched in India. However as per twisted logic of legitscript and big phrma, the needy patient will be blocked from these internet pharmacies in western world because LegitScript logic says .pharmacy can’t dispense to foreign patients. .pharmacy will add to more deaths in developing countries because it is created to create monopolistic closed markets for safeguarding commercial interested of some influential entities. Very unfortunate.

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