A new five-year initiative will provide significant savings for Canadians who use prescription generic drugs, participating public drug plans, and employee drug plans, announced the pan-Canadian Pharmaceutical Alliance (pCPA) and the Canadian Generic Pharmaceutical Association (CGPA) on Jan. 29.
The initiative will see the pricing of nearly 70 of the most commonly prescribed drugs in Canada reduced by 25 to 40 per cent as of April 1. These drugs include those used to treat high blood pressure, high cholesterol, and depression, and are collectively used by millions of Canadians. More than 70 per cent of all prescriptions reimbursed under Canada's public drug plans are generic drugs.
Billions in savings
“Previous joint efforts between pCPA and CGPA have resulted in savings of over $1 billion to participating drug plans over the past five years, and will continue to save $250 million per year. This initiative builds upon that foundation, and is estimated to save an additional $385 million in the first year, and up to $3 billion over the next five years through a combination of price reductions and the launch of new generic drugs. Savings to patients and employers are expected to match or exceed those achieved by Canadian governments,” stated the associations in a joint announcement.
A key component of this initiative is that tendering will not be pursued by the participating drug plans over the five-year term. The generic drugs covered under this initiative are manufactured by multiple companies.
Insurance industry applauds initiative
The Canadian Life and Health Insurance Association (CLHIA) welcomed the announcement. "This is wonderful news and we're especially pleased that these discounts will continue to apply to employer-sponsored plans to the benefit of all working Canadians," said CLHIA President and CEO Stephen Frank. "This agreement will reduce costs in the system and help ensure that employers will be able to continue to afford their employee supplementary benefit plans," he added.