Parallel Trade In Europe: Why Are Drugmakers Competing On Own

Parallel trade in pharmaceuticals is particularly prevalent in Europe, and not necessarily understood elsewhere. A recent leaflet from REMIT consultants, however, provides a useful explanation of how and when it occurs, and this is reproduced (with approval) here.

A UK pharmacist buys a branded drug from a supplier importing it from France though it is manufactured in the UK. The manufacturer's local price for the drug is significantly higher than that offered for exactly the same product by the importer.

Thus, the pharmacist has found a bargain. How? Through a coincidence of circumstances, intrepid traders have found a way to make money selling a product by undercutting its own manufacturers - ie parallel importing.