Reuters News is reporting that the pharmaceutical industry has offered the Canadian government $1 billion ($761 million U.S.) in an effort to have canceled several parts of a new drug pricing regime that is scheduled to go into effect on January 1, 2021.
The federal government in Ottawa has argued that Canada’s patented drug prices are too high, trailing only the United States and Switzerland, and that other countries with lower prices enjoy similar access to prescription medicines.
As a result, Ottawa plans to use the Patented Medicine Prices Review Board (PMPRB) to benchmark and set maximum prescription drug prices in Canada. But the pharmaceutical industry is putting up a fight and has told government officials that the industry is willing to spend $1 billion to boost local manufacturing and commercialization, and on new programs to improve access to drugs for rare diseases – if some costly reforms to the new pricing regime are shelved.
Specifically, the pharmaceutical industry wants the PMPRB to drop the United States and Switzerland from its drug price comparisons and add nations with lower prices.
Regardless of whether Ottawa will agree to the proposal, the remaining regulations would still reduce drug makers’ revenue by at least $19.8 billion ($15.1 billion U.S.) over 10 years, according to an industry estimate.
In a written statement, the federal health minister’s office said: “The position of the Government of Canada remains unchanged — Canada has among the highest patented medicine prices in the world, and these high prices negatively affect the ability of patients to access new medicines.”
Drug makers have warned that government-imposed price reductions, and the uncertainty associated with the complex cost-benefit analysis that will be required for some new medicines, will make pharmaceutical companies less likely to launch new drugs in Canada’s relatively small market.