While this country is still waiting for the Pan-Canadian Purchasing Alliance (PCPA) and Vertex Pharmaceuticals to come to an agreement regarding the cost of Kalydeco, Health Ministers of Ontario, Alberta and Yukon want to meet with the chief executive of Vertex Pharmaceuticals to get an explanation as to why Canadians have to pay a premium for this drug. This following a provincial-territorial health care committee meeting where Alberta Health Minister Fred Horne is on record as saying that it is unfair that Canadians have to pay more for the drug than Americans, to the tune of tens of thousands of dollars a year per patient.
While the case around the public funding of Kalydeco might be considered unique because of its astronomical cost, the fact that Canadians end up paying more for prescription drugs than other countries is apparently not unusual at all, as was pointed out in the April 2013 issue of Health Affairs by researcher Steve Morgan, a health policy expert at the University of British Columbia. He claims that Canada is missing out on brokering deals with pharmaceutical companies the same way fellow nations are. Morgan interviewed policymakers from nine countries similar to Canada, including Australia, Austria, Germany, Italy, the US and the UK.
The PCPA was announced in September 2010 by the provinces and territories as a means to purchase the most expensive brand-name drugs, but as reported in the Canadian Pharmacists Journal of September 2012, only 2 products have been purchased that way. And so it appears that the provinces and territories continue to “strike up their own individual deals with drug companies, missing opportunities to garner better prices if Canada negotiated rebates while buying as a whole country.” This according to Morgan, as quoted by Carmen Chai with Global News back in April of 2013: “The pricing of medicines is now a game of negotiation, similar to buying a car at a dealership. There is a list price equivalent to a manufacturer’s suggested retail price and then there are secret deals that everyone negotiates from there,” Morgan said. He told Global News that Canadians pay the second highest costs for brand name drugs in the world, second only to the United States. He said the large countries with multilevel health care systems lose out on drug pricing. New Zealand, for example, is a much smaller nation but it leverages its universal drug plan to lower its prices.
Canada pays about 20 per cent more for brand name drugs. Meanwhile, countries that negotiate the supply of generic drugs pay 90 per cent less than we do, Morgan said.
Tylenol or Advil, for example, would be about a fifth more expensive in Canada, while their generic counterparts, acetaminophen and ibuprofen, would be marked up by 90 per cent compared to other countries’ prices.
This shortfall in our bargaining power ends up on consumers’ shoulders, said Morgan.
“Current differences in price mean that Canadians are spending literally billions of dollars more than they should on prescription drugs. If we do not learn to negotiate rebates as well as comparators around the world, we will continue to pay billions of dollars more per year than we ought to,” Morgan told Global News. Pockets of our population, such as seniors, the poor or the very ill, end up paying the most out of pocket expenses for their drugs.
Across the board, Canadians and Americans paid for the most for their drugs. Deals struck between countries and drug companies are confidential though, so they don’t set precedents for other countries to follow.
Link to complete Global News article: http://globalnews.ca/news/473107/canada-losing-out-negotiating-lower-drug-prices-study-says/