Canada’s Pharmacare Act Introduced

On February 29, 2024, Canada’s Pharmacare Act was introduced by the government through Bill C-64. This bill is a significant step towards implementing a national pharmacare program, building on years of recommendations and studies.

In March 2016, the House of Commons Standing Committee on Health (HESA) initiated a study on developing a national pharmacare program. This laid the groundwork for subsequent actions including the Pharmacare Act, which outlines critical steps for establishing universal pharmacare in Canada. The bill sets several important deadlines:

• Within 30 days of royal assent, the Minister must establish a committee of experts to recommend options for operating and financing the program.
• Within one year of royal assent, this committee must provide a written report with recommendations.
• Also, within one year, the Canadian Drug Agency must prepare a list of essential prescription drugs to inform a national formulary.
• The agency must develop a national bulk purchasing strategy for prescription drugs in the same timeframe.

In March, Minister of Health Mark Holland stated publicly that he wants to see “folks getting their diabetes medicine covered and contraceptives… hopefully even by the end of this year.” This initial focus aligns with high-cost areas – diabetes drugs were the most expensive category for private plans in 2022, mainly due to Ozempic claims. Out-of-pocket costs for Canadians managing Type 1 or Type 2 diabetes can be formidable, as outlined in this article from Diabetes Canada. However, contraceptives represent a smaller portion of current drug spending. An overview of the Pharmacare commitment in the 2024 Federal Budget can be viewed here.

The proposed national formulary may resemble the World Health Organization’s essential medicines list or similar Canadian proposals. The bulk purchasing strategy will leverage Canada’s position as the 8th largest pharmaceutical market with a 2.2% global market share.

While the bill sets ambitious timelines, implementation will likely extend beyond the next federal election, which is due no later than October 2025. The program’s success will depend on provincial participation, negotiations with the pharmaceutical industry, and the expert committee’s recommendations on financing and operations.

This initiative represents a significant step towards addressing gaps in prescription drug coverage across Canada, potentially improving affordability and access for millions of Canadians.

 

This article about Canada’s Pharmacare Act is provided by Cowan, Asinta’s Partner in the country. If you need support with your employee benefits in Canada, contact Asinta, and we will put you in touch with Cowan.