Drug pricing in Canada just got more industry-friendly.

Canadian drug prices are already the . Now, with the release of new (PMPRB) at the end of June, the situation is poised to potentially get even worse.

The review board is the federal agency that was set up 1987 to ensure that the prices for patented drugs are not “excessive.”

Comparing prices

Up until now, one of the criteria the PMPRB used in making the decision about what was an excessive price was to compare the proposed Canadian price for a new drug with the median price in 11 other countries. The median is the 50 per cent mark; in other words, the price in half of the other countries was below what’s proposed for Canada, and the price in the other half was above the proposed Canadian price. Under the new guidelines, set to take effect on Jan. 1, 2026, the Canadian price can be up to the highest in those other 11 countries.

, the median price in the 11 countries Canada is compared to is 15 per cent below the price of patented drugs in Canada. The highest international price, which will be the new standard, is 21 per cent above the median Canadian price, meaning Canadian prices for new drugs will be significantly higher than they otherwise would have been.

Sometimes a drug is not available in any of the 11 other countries when it comes onto the Canadian market. In that case, the company can price the drug at whatever level it wants and keep it at that price until it comes up for its annual price review. The executive director of the PMPRB told the Globe and Mail that this would incentivize drugmakers to bring their products to the Canadian market first.

Incentivizing drug companies may be a reasonable idea, but that’s not part of the mandate of the PMPRB. As laid out in , its mandate is to ensure drug prices aren’t excessive.

Additional therapeutic value

In the past, one of the factors that the PMPRB took into account in determining if prices were excessive was the additional therapeutic value of a new drug compared to what was already on the market. The lower the value, the lower the price. In this regard, the PMPRB was advised by its Human Drug Advisory Panel, an independent group of experts.

The ranking of new drugs against existing ones was also of significant value to Canadian clinicians. It helped them to decide on the best treatment option for their patients and countered the .

Since the new guidelines have abandoned looking at therapeutic improvement of new drugs, that leaves only one remaining Canadian source for that type of information, the , a bimonthly publication targeting identified problematic therapeutic issues in a brief, simple and practical manner.

Complaints about prices can be made by federal, provincial and territorial health ministers and by senior officials who are authorized to represent Canadian publicly funded drug programs. “ (sic).” This advice is cold comfort for people working low-wage jobs who aren’t covered by provincial and territorial drug plans and don’t have any access to their health minister.

If there is an in-depth review of a new drug’s pricing — a preparatory step to determine whether there should be a formal hearing to investigate if the price is excessive — it is only the manufacturer that is allowed to submit information to the PMPRB. Clinicians who prescribe the drug, patients who take the drug, and organizations and individuals that pay for the drug do not have that same right.

Donald Trump’s on-again, off-again tariffs are already threatening to . Higher drug prices will also almost certainly affect Canada’s already limited pharmacare program. Higher prices for new drugs will make an expanded pharmacare plan more expensive and less appealing to the federal government. The new PMPRB guidelines help ensure higher drug prices and no pharmacare expansion.

By Professor Emeritus of Health Policy and Management , 91ŃÇÉ«

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If the United States imposes 25 per cent tariffs on exports from Canada, nearly all economists agree a recession is inevitable. Estimates are that between to jobs are at risk.

Based on previous recessions, the and stay stuck at that level for some time.

Adding insult to injury, are covered by employer-sponsored drug plans, which means that when these workers get laid off, they also lose their health benefits, including prescription drug insurance tied to their jobs.

Affordability of prescription drugs

During the COVID-19 pandemic, , about one-fifth of the population reported not having insurance to cover prescription medications. This coincided with a soaring unemployment rate that in May 2020. The problem of not having insurance for prescription medications was among immigrants and racialized people. These are the same groups of people that will be at the highest risk of any recession-linked job losses.

Unsurprisingly, spent more than $500 out-of-pocket in 2022 on prescription drugs compared to 10 per cent for those with insurance. Canadians in the in absolute terms than those in the highest income quintile ($296 versus $268) in 2009, and it’s unlikely this disparity has significantly changed.

Already there are estimates that the leads to 370 to 640 premature deaths due to ischemic heart disease, 550 to 670 premature deaths from all causes among people 55-64 years of age and avoidable deterioration in health status in 70,000 people age 55 and over.

When Canadians must choose between buying prescription drugs and paying for food and rent, it’s often no contest; patients skip their medications and suffer the consequences. The result is .

Tariffs and drug prices

Added to the threat of losing prescription drug coverage with job loss is the very real possibility that drug prices will increase. of the active pharmaceutical ingredients that go into the medicines that North Americans take originate in China. U.S President Donald Trump has now threatened to slap U.S. tariffs on that were previously exempt.

Canada already annually in prescription drugs from the U.S. To the extent that tariffed drugs go from China to the U.S. to Canada, the cost of both publicly and privately funded drug plans will increase.

Those people at the bottom of the income scale who pay out-of-pocket — and can least afford to pay more — will be saddled with those higher prices. If Canada follows the U.S. in imposing tariffs on drugs made in China, , then the price of generic drugs made in Canada from Chinese ingredients will also rise.

We can hope that any tariffs — on Canada or China — will be only temporary and we can avoid the ongoing effects on both access to prescription drugs and their price. But given Trump’s volatility and unpredictability, we can’t rely on that outcome.

With the passage in October 2024 of Canada’s new Pharmacare Act, the government of Canada committed to “.” We need to expand Canada’s federal pharmacare plan to cover all Canadians for all medically necessary drugs. Indeed, the need has never been as acute.

So far, have signed agreements with the federal government to cover contraceptives and diabetes drugs and devices — the only products currently covered under Bill C-64. The remaining provinces and territories urgently need to sign on. Prime Minister must decisively commit to expanding the range of drugs that is covered by pharmacare.

All the provincial, territorial and federal leaders have . Expanding pharmacare is part of that protection.

By Professor Emeritus of Health Policy and Management, 91ŃÇÉ«

The post How Donald Trump’s tariffs threaten Canadians’ access to prescription drugs appeared first on News@91ŃÇÉ«.