Dr. Marc Andre Gagnon speaking at the Students for Medicare conference in Toronto April 27.
Dr. Marc Andre Gagnon says that while Medicare is sustainable, rising drug costs are not.
A leading expert on pharmaceutical policy in Canada, Carleton University’s Gagnon spoke Saturday at the Students for Medicare conference in Toronto.
Gagnon says drug costs have been rising by an average of 10 per cent annually since 1988. Even with the so-called “patent cliff” where major blockbuster drugs have dropped in price due to the recent availability of generics, overall drug costs are still rising by 4.7 per cent per year.
The patent cliff benefit won’t last according to Gagnon. Within two or three years costs will be rising again unless the system is reformed.
For Gagnon, it’s not so much a question of if we have reform, but what kind of reform we want. Drug costs in Canada and Japan are rising faster than any other industrialized nation and provinces are under pressure to act.
In Canada 44 per cent of spending on drugs is public, 38 per cent paid for by private insurance, and 18 per cent paid out-of-pocket.
Hidden among the many recommendations of the Drummond Commission is a surprise warning about the pitfalls of a Canada-European Union Free Trade Agreement.
Drummond points out that the $500 million in savings from the government’s generic drug pricing reforms could be wiped out if the province’s interests are not protected by the Harper government.
Harmonizing patent protection for brand-name drugs to European standards would keep generic drugs off the market for a longer time.
Drummond highlights the findings of a study done by Aidan Hollis (University of Calgary) and Paul Grootendorst (University of Toronto) who noted that if all three of the EU pharmaceutical intellectual property proposals are adopted, it will cost Ontarians up to $1.2 billion annually. Slightly less than half — $551 million, would be added cost to the government, whereas the rest would come out-of-pocket and from private employer health plans.