E-drug: USA Drug Pricing Comparison (cont)
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The amount of variation in drug prices in Canadian provinces depends
on what the patent status of the drug is. If the drug is still under
patent then its introductory price and the rate at which its price can
rise is governed by the federal Patented Medicine Prices Review
Board. The result is that prices for this class of drugs is relatively
uniform across the country. If drugs are either off patent or generic
then their prices are not controlled by the PMPRB and will depend on a
number of factors, primarily whether or not they are listed on the
provincial drug formularies. (Public drug plans are run by the provincial
governments.) The size of the provincial market will determine how
much of a discount the government can get from the company. Also
different provinces have different rules regarding prices of generic
drugs. Here in Ontario, I believe that the first generic on the market
has to be at least 25% below the price of the brand name originator.
Other provinces may have different rules. Finally, Ontario used to
enforce what is called the BAP (best available price) for all drugs listed
on its formulary. In-other-words, the Ontario government required
companies to offer drugs to it at the lowest price that the company
sold the drug anywhere in Canada.
Joel Lexchin MD
121 Walmer Rd.
Toronto, Ontario
CANADA M5R 2X8
Phone: +416-964-7186
Fax: +416-923-9515
e mail: joel.lexchin@utoronto.ca
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