TORONTO — A new study warns that Canada's prescription drug supply is threatened by Internet pharmacy sales to Americans.

The Fraser Institute study used figures supplied by IMS Health Inc., Canada's leading drug data agency. The sample covered the 500 top selling products representing 92 per cent of total sales through 278 cross-border Internet pharmacies.

The Vancouver-based think tank concluded that despite the rising value of the Canadian dollar, cross-border drug sales remain high.

As a result, according to the study, drug shortages reported in Canada could soon worsen dramatically because of U.S. demand.

The study also cautions that Canadian drug sales to the U.S. are on the verge of a massive expansion that would swallow the domestic supply.

The U.S. Food and Drug Administration bans the bulk purchase of cross-border drugs for U.S. social programs and public employees.

But attempts to legalize bulk sales has grown from three per year in 2002 to 84 per year by September 2005, with 16 passing, notes study author Brett J. Skinner, the Institute's director of pharmaceutical and health policy research.

"Unless our governments take action now, Canadian patients might soon have to compete with a much larger and wealthier group of Americans for the limited supply of drugs made available to the Canadian market," said Skinner.

"Due to the massive size of the U.S. population - patients in Canada will end up on the losing side of this competition."