VANCOUVER – Almost 10 per cent of Canadians never fill their drug prescriptions. They can’t afford it.
We’re here in Vancouver for a unique forum to discuss what every major national health care system review over the last 50 years has recommended – the need for a national pharmacare program. We can no longer ignore the fact that universal access to prescription drugs is a necessary part of any modern health system. Canada is an outlier on the international stage – most countries have some form of universal pharmacare coverage for its citizens. Given the collective wealth of our nation, this is a major embarrassment. As one participant in Pharmacare 2020 noted, we have yet to enter the 21st century when it comes to drugs.
How different our health system might look should we have followed Justice Emmett M. Hall’s recommendations in 1964 that Canada move to a national pharmacare system with a $1 deductible on prescription drugs. Since then we have had the National Health Forum (1994-97) The Romanow Commission (2002) and the recent National Pharmaceutical Strategy which failed to come to any agreement on the objective of providing the basic minimum of catastrophic drug coverage. Seems the provinces could not agree not to bankrupt very ill citizens who are faced with steep drug costs.
It’s not like we are saving the public treasury money.
Arthur Fabbio Jr, Director of Total Compensation Programs for Magna International, admitted it would be a benefit for business to have a public pharmacare program. Among other things, it would deliver cost certainty, something that currently evades businesses in the present patchwork system of private and public coverage. He recognized that a national drug program would enjoy the economic advantages of scale that no individual private program could match.
David Henry, President and CEO of the Instititue for Clinical Evaluative Sciences, said the costs of a public pharmacare system would be substantially offset by savings from the cost to the public health care system of complications experienced by people who cannot afford to fill their prescriptions, particularly those with chronic illnesses. If they don’t get their drugs, they end up in our public hospitals at a much higher cost to the health budget.
Pharmacare 2020 went out of its way to make sure everybody showed up. That included representatives of the drug companies, of the pharmacists, and some of the bureaucrats that face the challenges of fast rising drug costs to their provincial budgets.
Barbara Walman, Assistant Deputy Minister for BC’s Pharmaceutical Services, said the ground was “fertile” for change among the provincial Premiers. Drugs are the second highest cost after hospitals for provincial health budgets. Most jurisdictions have already set new caps for generic drug pricing – ranging from a high of 35 per cent of brand prices to 20 per cent expected to be implemented next year by BC. The provinces have begun agreeing on bulk purchasing, although so far the list of drugs being purchased in this manner is limited to six.
There is talk of a more formalized approach to cooperative drug purchasing among the provinces, although no structure has been agreed to, let alone put in place.
Marc-Andre Gagnon, assistant professor at Carleton University’s School of Public Policy and Aministration, laid out the case for why we need to play catch-up with rest of the world. We collectively spend $27.2 billion on prescription drugs. The costs are escalating by 4.7 per cent per year over the last decade. Our total expenditure on drugs on a per capita basis is second only to the U.S., yet the price we pay for individual generic drugs is much higher than our American cousins.
Our private drug programs are structured to make more money as costs rise, so there is little incentive to constrain spending. In Canada only 60 per cent of prescriptions are generic compared to 80 per cent in the U.S. Some of that was laid at the feet of union negotiators who are clinging to expensive brand name drug plans amid restraint on just about everything else.
“We continue to import U.S. style policy with the predictable U.S. results,”
Gagnon told the conference of more than 200 delegates. That includes massive waste, undertreatment and rising costs that are unsustainable.
The evidence in favour of a public system in clear – all that is lacking is the political will.
Michael Law, an assistant professor at UBC’s Centre for Health Services and Policy Research, ruffled the feathers of industry representatives when he compared the substantial differences in publicly funded generic drug costs in Canada to New Zealand and the U.S. Among the comparators was the drug Simvastatin, of which a 20 mg pill sells for 62.5 cents in Canada. In the U.S. the same pill will cost 6.9 cents and in New Zealand 2.4 cents. The difference would be equivalent to buying a $60 cup of Tim Horton’s coffee he said.
Jim Keon, President of the Canadian Generic Pharmaceutical Association, shot back that Law was looking at the lowest prices in the world as comparators. He said these prices did not match the average generic drugs costs in the U.S. or among other nations.
Law generated the biggest applause of the day when he replied that he couldn’t imagine a retailer putting up a sign that said “We now price at the average.” He said his choice of comparators was deliberate because we should be seeking the lowest price. Law argued we should dump the idea of scaling generic prices as a percentage of brand prices and instead open up drug pricing to competition.
Law also took on the Canadian Pharmacists Association over its threats to close drug stores in the wake of Ontario’s decision to cap generic drug pricing to 25 per cent of brand name costs and end the system of rebates pharmacies relied upon. The year Ontario implemented the changes 52 commercial drug stores closed down. However, 159 also opened. The following year Ontario had a net gain of 30 more drug stores. Law said there were 40 per cent more community drug stores per capita in Canada than the U.S. Access is not an issue — 44 per cent of Ontarians live within 800 metres of two or more pharmacies.
Jody Shkrobot, the past president of the Canadian Pharmacists Association, acknowledged the drug stores were open, but said the impact of Ontario’s changes meant there were fewer staff to provide professional services to their customers.
Many at the conference agreed that while provinces were trying to bring down the cost of prescription drugs, the Federal government was moving in the opposite direction by considering linking patent extensions as part of negotiations of the Canada European Trade Agreement (CETA). Keon noted that would mean patent protection for another three and a half years, driving up drug costs by an estimated $2.8 billion per year.
A number of speakers criticized the Federal government f0r being absent from the discussions about Pharmacare. How possible it will be to implement a national program without the involvement of Ottawa is difficult to say.
About a third of the conference delegates are from Ontario, including Diane McArthur, Assistant Deputy Minister for Ontario’s Public Drug Programs. She said that Ontario publicly allocates $4.4 billion a year on prescription drugs – 9 per cent of total health care spending. Yet the administration of the Ontario Drug Program is done by a staff of only 100. Since 2006 Ontario has introduced 97 new drugs to the formulary.
McArthur was critical of the federal process of bringing drugs to market – suggesting it was too costly, took too much time, and lacked transparency.
Tomorrow the conference concludes with presentations from Saskatchewan health policy analyst Steven Lewis and Conference Chair Steve Morgan, the UBC Associate Professor who is often described as being the driving force behind this renewed Pharmacare movement.