In 2019, during the Democratic primaries, Vermont Senator Bernie Sanders surprised many when he led a convoy of citizens crossing the Canadian border to buy insulin. Sanders wanted to show the absurdity of drug prices in the United States. South of our border, a simple vial of insulin can be sold for $300 in pharmacies, while in Canada, citizens can buy it for one-tenth the price. However, the vial costs $8 to produce.
It was enough for the senator to decry the lack of price regulation in the United States. For Sanders, Americans should learn from Canada.
Although Sanders is right that the prices of drugs sold in the United States are excessive, many consider that the Canadian system is far from perfect. By comparison, drug prices are 25% higher in Canada than the average for OECD countries and Canada ranks third in pharmaceutical spending per capita.
A Pharmasanté
Admittedly, the provinces and the federal government can negotiate group prices with pharmaceutical manufacturers, but with 100,000 private insurance plans across Canada, it is clear that bargaining power is limited. Hence the idea of creating universal public insurance that would replace the disparate drug coverage system. With the implementation of such coverage, the government would like to better control drug prices and offer drug insurance to all Canadians.
However, the cost of public insurance could dampen the enthusiasm of the government. An advisory committee estimated the cost of such a program at $15 billion more per year. However, with an announced deficit of $40.1 billion for 2023-2024, the federal government will have difficulty convincing Canadians that this program will be implemented without increasing taxes.
Prices hard to swallow
As the Government of Canada regulates the prices of patented medicines in Canada, it relied on the Patented Medicine Prices Review Board (PMPRB) to review drug pricing. The PMPRB is an independent regulatory body responsible for protecting Canadians from excessive drug costs.
In 2019, the PMPRB therefore proposed a series of changes to the regulation of drug prices: 1– the introduction of new price regulation factors based on the economy and the ability of Canadians to pay; 2– updating the list of countries used as a comparison to establish price ceilings for drugs; 3– the need to require more information on the cost of drugs and on discounts granted to third parties. From this reform, savings of $13 billion over 10 years were expected.
Of course, the pharmaceutical companies had not said their last word and they questioned the legality of the government’s actions. A dispute that ended on December 18, 2020 with the invalidation of the government’s actions in the Superior Court of Quebec on the basis that it is unconstitutional for the PMPRB to regulate agreements and access to the discount for cardholders patents.
Fortunately, the Court of Quebec upheld the modification of the list of countries that serve as a comparison to establish ceiling prices for drugs. It is proposed to remove the United States from the list and to add Australia, Belgium, Japan, the Netherlands, Norway, South Korea and Spain. The prices of drugs in the United States are excessively high and distort the comparative analysis made with other countries of the Organization for Economic Co-operation and Development. It is predicted that this change alone could reduce drug expenditures by 19%.
We find everything… even a minister
A dramatic turn of events, the Minister of Health Jean-Yves Duclos requested last November the suspension of the modification that the Court of Quebec had maintained. In an exchange of letters obtained through the access to information law, representatives of the pharmaceutical industry would have met the minister and his team no less than a dozen times in the fall of 2020. The letters obtained confirm also that following these meetings, Minister Duclos intervened personally with the President of the PMPRB to ask her to suspend the reform. A few months later, the president, the director and a member of the PMPRB had resigned.
While the powerful pharmaceutical lobby can pride itself on having succeeded in countering the efforts of the federal government to reduce drug prices, it is difficult for citizens not to be disillusioned when faced with a pharmaceutical industry that looks like an elephant in the room. With a touch of irony, Fernand Séguin wrote: “Health, we have been told enough, is priceless, and if illness has a price, which is that of the pill, we are prepared to pay it. pay until we can no longer afford it. Provided that Valium remains within everyone’s reach. »