Dr. Hedy Fry is convinced that Canadians are paying far too much for prescription drugs, either individually or through insurance plans. In a phone interview with the Georgia Straight, the veteran Vancouver Centre MP and Liberal health critic even put a price tag on the unnecessary cost to the country: $14 billion per year.
“Canada is the only industrialized nation that has a national health-care system and that does not have a national pharmaceutical strategy of any kind,” Fry said.
She based her $14-billion annual estimate on data compiled by Steve Morgan, an associate professor in UBC’s school of population and public health. Morgan coauthored a commentary earlier this year (Rethinking Pharmacare in Canada) with UBC health-policy researchers Jamie Daw and Michael Law for the C. D. Howe Institute, pointing out that Canada spent $903 per capita on pharmaceuticals in 2010.
Only the United States, at $1,198 per capita, spent more. Germany ($708), Australia ($692), the Netherlands ($587), the United Kingdom ($481), and New Zealand ($348) all spent significantly less per capita than Canada. Our nation’s average annual growth rate of 4.13 percent per year over the previous decade was the highest of seven countries highlighted in the publication.
The Vancouver Centre MP said that the balkanized Canadian system—in which provinces and insurers negotiate their own prices rather than working through one organization—enables pharmaceutical companies to charge higher prices.
“The point is [that] in New Zealand and places like that, they negotiate very, very differently,” Fry said. “In Europe, they negotiate very differently.”
She explained that these countries don’t only negotiate bulk purchases. They often have an arm’s-length organization, akin to a Crown corporation, acting on everyone’s behalf.
“Why does Canada negotiate such high prices for drugs when other countries in the world don’t?” she asked. “We don’t fare comparatively well with them at all.”
On September 4, Fry will host a town-hall meeting on PharmaCarefrom 6 p.m. to 8 p.m. at PAL Vancouver (581 Cardero Street).
She said that Morgan and Law will join her on the panel, with each giving 10-minute presentations. That will leave plenty of time for the public to ask questions and make comments.
“There is a tendency for many ordinary Canadians to say, ‘This is my problem. Nobody is helping me. I’m not hearing about it. I’m not reading about it in the papers. Therefore, I must be the only person this is happening to,’ ” Fry said. “[I want to] engage people in coming up with creative ideas on what it is Canada needs to do and go forward.”
Last year in his book Chronic Condition: Why Canada’s Health-Care System Needs to Be Dragged Into the 21st Century (Allen Lane), Globe and Mail columnist Jeffrey Simpson acknowledged that Canadian pharmaceutical costs “are out of line with international prices”.
Simpson also highlighted the huge drug-price differential between New Zealand and Canada. But he questioned whether or not Canada could achieve savings similar to what’s occurred in the South Pacific nation.
“New Zealand has no brand-name drug companies,” he wrote. “Its market is too small and its geographic location too distant for drug companies to consider setting up shop there. New Zealand accepts this reality and can design a drug policy around cost, quality, of course, and not much else.”
Simpson made the point that Canada and other western countries want to attract pharmaceutical-company investments in research and development. But it’s not an argument that impressed the UBC-based authors of the C. D. Howe Institute commentary.
Citing research last year by the Organisation for Economic Co-Operation and Development, they declared that “the pharmaceutical industry invests considerably more in research and development in the United Kingdom than in Canada on a per capita basis.” And the U.K. drug costs are, on average, about 30 percent below those in Canada.
Fry said she’s also concerned about looming shortages of prescription drugs. In some cases, she noted, generic manufacturers decide to stop producing drugs because they can no longer make any money on them. The consequences to patients can be devastating.
She pointed out that U.S. president Barack Obama has issued an executive order to the U.S. Food and Drug Administration to report on potential shortages and examine why prices are so high. She contrasted that with Prime Minister Stephen Harper’s refusal to develop a national pharmaceuticals strategy, which was one of the objectives listed in the 2004 health accord with the provinces.
“We have brought this to the government’s attention and they have done diddly squat except to say there should be a voluntary system in which drug companies can let people know well in advance when there’s going to be a shortage of drugs,” Fry said.
She added that unlike his Liberal predecessors, Harper won’t even meet Canadian premiers and territorial leaders to discuss health issues.