CGPA: Alberta Government’s Price Cuts to Cost-Saving Generic Prescription Medicines Short-sighted and Misdirected

Toronto, March 11, 2013The following is a statement by Jim Keon, President of the Canadian Generic Pharmaceutical Association (CGPA), regarding the Alberta government’s announced plans for further cuts to generic prescription drug prices.

“The massive and indiscriminate cuts to reimbursed prices of generic pharmaceutical products announced by the Government of Alberta in its March 7, 2013 budget are wholly unacceptable to Canada’s generic pharmaceutical manufacturers and risk patient access to high-quality, affordable prescription medicines.

These across-the-board cuts represent a betrayal of our industry and were announced without consultation, or prior notice to, generic pharmaceutical manufacturers, community pharmacy or other key stakeholders in the pharmaceutical supply chain. The Alberta government must open collaborative discussions with stakeholders immediately to ensure any changes are made in the best interest of patients.

The slashing of generic prices further jeopardizes the supply of cost-saving medicines for Albertans. In the face of these dramatic cuts to reimbursed prices, our industry plans to contact Health Canada to inform them of generic pharmaceutical products that may no longer be viable.

Along with threatening the current drug supply, these dramatic cuts to generic drug prices in Canada will result in fewer cost-saving generic drugs coming to market resulting in hundreds of millions of dollars in lost savings to the health-care system. As a result, the Alberta government and other payers will end up paying the full cost of the higher-priced brand-name equivalents.

Along with our partners in the pharmacy, pharmacist and pharmaceutical distribution sectors, CGPA has been working with provincial and territorial governments to develop proposals that would provide significant savings to Canada’s health-care system today and well into the future. The Alberta government blind-sided our industry and our partners by slashing generic drug prices with no consultation or warning while at the same time acting as a co-lead of a pan-Canadian process to achieve efficiencies and savings.

We call on the Government of Alberta to abandon this ill-conceived course of action and, instead, return to multi-stakeholder initiatives that will improve access to affordable health care.

Rather than tackle meaningful reforms to save health-care dollars through more effective use of generic prescription medicines such as: increasing generic drug utilization to levels in jurisdictions such as the United States, providing incentives for generic drug firms to challenge invalid or non-infringed drug patents, and ensuring new generic drugs are added to the government’s drug plan formulary quickly and efficiently- the government chose to add little value to patients. Ending government waste and duplication would provide significant savings opportunities with no adverse impact on Alberta patients.

For example, if the Government of Alberta had added generic versions of top-selling cholesterol-lowering drug Crestor to its drug plan formulary as quickly as the Government of British Columbia, it would have saved Alberta taxpayers $1.5 million dollars in 2012 on just this one prescription medicine alone.

In 2012, generic drugs filled fully 64 percent of all prescriptions in Alberta, yet accounted for only 30 percent of all prescription drug spending. Generic prescription medicines represent less than 3 percent of all health-care spending in Canada. Clearly, generic drugs are already providing excellent value for Albertans.”

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 more than 63 per cent of all prescriptions but account for only 24 percent of the $22-billion Canadians spend annually on prescription medicines.

For more information, please contact:
Jeff Connell
Vice President, Corporate Affairs
Canadian Generic Pharmaceutical Association (CGPA)
Tel: (416) 223-2333
Mobile: (647) 274-3379