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Canadian R&D-to-Sales Ratio for Brand-Name Drug Companies Less than Half of 10% Commitment

Toronto, September 12, 2016 – Brand-name drug companies’ research and development spending as a percentage of sales in Canada is less than half of the 10% the industry committed to when their periods of market exclusivity were increased in 1987, according to the most recent annual report from the federal government’s Patented Medicine Prices Review Board (PMPRB).

The PMPRB’s latest annual reports shows that in 2015 member companies of Innovative Medicines Canada (formerly Rx&D) spent only 4.9% of their Canadian revenues on research and development in Canada, marking the 13th consecutive year they have failed to meet the 10% percent threshold.

“In Canada, market monopolies for brand-name drug companies have been increased eight times since 1987 yet investments continue to lag far behind their commitments. There is clearly no link between increased periods of market exclusivity and increased investments in Canada,” said Jim Keon, President of the Canadian Generic Pharmaceutical Association (CGPA).

The PMPRB Annual Report shows that, based on the most recently available international data, the ratio of R&D to domestic sales in Canada is the lowest of all comparator countries. The aggregate ratio for R&D spending to domestic sales for all comparator countries was 22.8%, five times greater than Canada’s.

The PMPRB also reported that sales of patented drugs increased from $13.8-billion in 2014 to $15.2 billion in 2015, tying the record for the single-largest increase in patented drug sales in Canadian history.

The PMPRB’s findings are highlighted in a new report released today by CGPA. Copies of The Real Story: R&D Spending by Brand-Name Drug Companies in Canada: 1988 – 2015 are available at

About the Canadian Generic Pharmaceutical Association

The Canadian Generic Pharmaceutical Association (CGPA) represents Canada’s generic pharmaceutical industry. The industry plays an important role in controlling health-care costs in Canada. Generic drugs are dispensed to fill more than 76 percent of all prescriptions but account for account for less than 22 percent of the $41.5-billion Canadians spend annually on prescription medicines.

For more information, please contact :

Jeff Connell,
Vice President, Corporate Affairs

Tel: (647) 274-3379