Prof. Hollis and his co-author, Paul Grootendorst of the University of Toronto’s Faculty of Pharmacy, stressed that while the paper is commissioned, it is not designed to promote the point-of-view of generic manufacturers.
Prof. Hollis said their role was simply to examine the potential economic impact of the trade provisions and they do not take a position on whether the provisions are good or bad.
The Canadian Chamber of Commerce, for its part, strongly backs the new provisions, saying Canada risks losing out on the next wave of lucrative pharmaceutical investment and jobs unless it matches tougher patent protection for drug makers in the U.S. and Europe.
“The world has continued to move on. We haven’t,” said Chamber president Perrin Beatty.
The new report, however, calculates that the EU proposals would cost Canadians $2.8-billion extra for prescription drugs annually, but generate only $345-million of additional investment in pharmaceutical research and development in Canada.
“If the goal is to increase R&D, you have to wonder if extending exclusivity is the way to do it,” Prof. Hollis said.
Negotiations toward a Canada-EU trade agreement – which is designed to reduce tariffs and trade restrictions in a variety of sectors – have been under way since 2009. International Trade Minister Peter Van Loan has said he hopes to conclude a deal by the end of 2011.
The negotiating positions of each side are supposed to be confidential but the EU position on pharmaceutical-related provisions was leaked and has circulated broadly. It is not clear if Canada has made a counter-proposal.
Canadian spent $25.4-billion on prescription drugs in 2009, the most recent year for which detailed figures are available. That includes $14-billion in private spending and $11.4-billion in public spending, according to the Canadian Institute for Health Information.
Russell Williams, president of Rx & D, the organization that represents brand-name drug companies, said he could not comment on the specifics of the new report but insisted that updating Canada’s intellectual property regime – as is being proposed in the new pact – is essential.
“If we want to attract innovation dollars and the good jobs that come along with them, we need a globally competitive regime and we don’t have one now,” he said.
Mr. Williams also said he found it a bit hypocritical that generic manufacturers seem so concerned about drug costs when “we’ve been overpaying for generics for the past 20 years.” (Canada had, until recently, some of the highest generic prices in the world.)
He also noted that “without R&D, without innovative drugs, there will be nothing for generics to copy.”
PROPOSED PLAN’S IMPACT
Under the provisions of an EU trade deal, Canada’s annual drug-plan cost increases would be:
Alberta: $211.5-million
British Columbia: $249.1-million
Manitoba: $79.8-million
New Brunswick: $52.2-million
Newfoundland: $46.4-million
Northwest Territories: $2.6-million
Nova Scotia: $95.0-million
Nunavut: $1.7-million
Ontario: $1.2-billion
Prince Edward Island: $10.4-million
Quebec: $772.6-million
Saskatchewan: $72.3-million
Yukon: $1.9-million
Total: $2.8-billion
