FTC Testifies "Drugstores on the Net:The Benefits and Risks of Online Pharmacies"

The Federal Trade Commission today testified before a House Subcommittee about the benefits and risks of online pharmacies. Jodie Bernstein, Director of the FTC's Bureau of Consumer Protection, presented the Commission testimony. While Bernstein noted that the availability of prescription drugs via online pharmacies offers potential benefits to consumers, including convenience and value, she warned that "the current practices of some online pharmacies and of some physicians that provide online prescription services indicate the potential for serious consumer injury." The testimony recommends that Congress consider whether legislation requiring disclosure of identifying information about the location of a prescription drug web site, online prescribing physicians and online pharmacies is necessary to assist state law enforcement efforts.

The testimony points out that "[s]ignificant potential for injury exists when prescriptions are issued without adequate review of the consumer's medical history, or when unapproved drugs are sold to consumers over the Internet by overseas pharmacies. According to Bernstein, the rapid growth of online sales of prescription drugs presents significant technological and logistical challenges to the traditional state regulatory framework that protects consumers in the marketing of prescription drugs. She noted that both state medical boards and state pharmacy boards have expressed concerns to the Commission that their existing enforcement tools are not adequate to police the online medium.

Bernstein also told the Committee that the agency had reviewed almost 100 sites provided by Subcommittee staff. Very few provided adequate identifying information, she said. "Even when parties can be located, it can be difficult and costly for a state medical board or a state pharmacy board to pursue law enforcement against an out-of-state physician or pharmacy prescribing or dispensing prescription drugs inappropriately via the Internet."

The testimony notes that the Commission can play a role in protecting consumers who use online pharmacies by bringing cases against specific deceptive practices. The FTC's authority is limited, however, and may not fully address the important consumer protection issues raised by online prescribing, the testimony points out. Bernstein said that the practices that present the greatest concerns -- whether the consumer has a valid prescription to obtain the drug -- have traditionally been regulated by the states. "The Commission suggests that the Subcommittee consider whether additional legislative measures are necessary to address the unique characteristics of this medium and ensure greater protections for consumers," she said.

She also suggested requirements for clear and prominent disclosure of identifying information for the online prescribing physician, the online pharmacy and the web site owner, if different, as well as the states where prescriptions will be dispensed. This requirement would greatly assist state law enforcement efforts she said.

Bernstein explained the FTC's jurisdiction over online pharmacies. "The Commission has authority to bring an enforcement action where an online pharmacy makes false or misleading claims about the products or services it provides," she said. In addition, Bernstein said, the Commission has jurisdiction if there is a misrepresentation by an online pharmacy of its privacy practices, for instance, false statements about how the site collects and uses medical information about the consumer.

The testimony states that many aspects of the online prescribing and dispensing of prescription drugs, do not fall clearly within the agency's traditional scope of authority or expertise and have been the primary responsibility of other federal and states agencies.

Bernstein described the actions taken by the Commission regarding online prescription drug sales: monitoring web sites; conducting investigations, making referrals to other federal and state authorities; and coordinating activities through an interagency working group, comprised of the FTC, FDA, the Department of Justice, the Drug Enforcement Administration, and other federal and state agencies. "One of the group's tasks is to explore enforcement issues and potential jurisdictional gaps," she said.

The testimony describes two efforts by FTC staff to purchase prescription drugs online. Both efforts were successful even though in one case the staff listed a "patient's" medical history that should have raised serious concerns about the appropriateness of issuing a prescription. In both cases, staff of the Commission were issued a prescription for Viagra online with no questions asked. Referrals were made to the relevant state medical and pharmacy boards, the testimony states.

In conclusion, the testimony states that the FTC will continue to do its part to combat deceptive practices by online pharmacies and to assist other authorities in their investigative efforts. It also offers specific suggestions for possible disclosure requirements for online prescription drug sites.

The Commission vote to authorize the testimony was 4-0.

Copies of the testimony are available from the FTC's web site at http://www.ftc.gov and also from the FTC's Consumer Response Center, Room 130, 600 Pennsylvania Avenue, N.W., Washington, D.C. 20580; 202-FTC-HELP (202-382-4357); TDD for the hearing impaired 1-866-653-4261. To find out the latest news as it is announced, call the FTC NewsPhone recording at 202-326-2710.

(FTC File No. 994507)
(pharma)