Canada has the key to lowering drug prices. Here’s why it won’t be used any time soon

Health Canada has quietly delayed implementation date for controversial drug rules

Kelly Crowe· CBC News · Nov 24, 2018

Canada’s pharmaceutical industry opposes changes to federal regulations that would lower the price Canadians pay for patented drugs. (Shutterstock/Tero Vesalainen)

[Excerpts] There’s a battle being fought in the backrooms of Ottawa, and the outcome could determine how much Canadians will pay for new drugs.

The federal government has developed a series of regulations that would lower Canada’s patented drug prices, which are among the highest in the world.

Canada is second only to the United States in per capita drug costs. But the new rules were like a gauntlet thrown down in the path of the pharmaceutical industry, which has been lobbying federal government officials ever since.

“Drug companies understand very well what’s at stake, and they’re massively mobilizing to make sure nothing happens,” said Marc-André Gagnon, a pharmaceutical policy researcher at Carleton University.

The dispute is over a policy document called Protecting Canadians from Excessive Drug Prices — a series of amendments to the Patent Medicine Regulations that former health minister Jane Philpott announced on May 16, 2017.

“Canadians are paying too much for prescription drugs,” Philpott said at the time. “These measures will go a long way toward helping Canadians afford the medicines they need to live healthy, productive lives.”

Marc-André Gagnon, a pharmaceutical policy researcher at Carleton University, says drug companies know what’s at stake and are ‘massively mobilizing to make sure nothing happens.’ (Marc-André Gagnon/Evidence Network)

Industry resistance intense

Bringing Canada’s drug prices down sounded like a reasonable idea. And the plan would work, according to the industry’s own calculations.

Janssen Canada president Chris Halyk estimated “an average reduction in prices of approximately 20 per cent,” in a submission letter sent to the federal health minister in February.

But if drug prices go down, so do industry revenues, falling by up to $26 billion over 10 years, according to one industry report.

That’s one reason why the industry’s resistance has been so intense. And it’s wielding a big stick, threatening that companies could hold back the launch of new drugs in Canada if the amendments are approved.

Read more at: Canada has the key to lowering drug prices. Here’s why it won’t be used any time soon