October 22, 2019 / 7:13 PM / 24 days ago

Canadian election clears path for universal drug plan

TORONTO (Reuters) - Canada’s Liberal government is more likely to pass a universal prescription drug plan after losing its majority in Monday’s election, setting the stage for what would be the biggest shakeup of the country’s public healthcare system since it was created in the 1960s.

Liberal Party supporters flash V-signs while watching the live federal election results at the Palais des Congres in Montreal, Quebec, Canada October 21, 2019. REUTERS/Stephane Mahe

The Liberals won the most seats in the election but fell short of a majority, which means Prime Minister Justin Trudeau will need the support of rivals like the left-leaning New Democratic Party (NDP) to govern. Both the Liberals and NDP have promised a new national drug plan.

Canada is the only developed country with a universal health care system that does not cover prescription drugs for all, though a patchwork of provincial programs support the elderly and people with low income or very high drug costs. Most Canadians rely on employer-funded drug plans.

Steve Morgan, a University of British Columbia health economist and leading advocate for a universal drug plan, or pharmacare, said the election results created a “window of opportunity” to change the system.

Universal drug coverage has been proposed before, but the rise of high-cost drugs has given the idea new urgency, as some patients struggle to pay for medication, and employer-funded plans shift high-cost patients to provincial plans, straining budgets without creating the negotiating power that a single federal buyer could wield against drugmakers.

“I think this is our best chance, the best opportunity we’ve ever had to bring pharmacare into the healthcare system,” said Eric Hoskins, who led a federal advisory council on the issue. “I feel even more strongly about that today. I am confident that the Liberals will follow through on their commitment.”

Speaking to supporters after the election, NDP leader Jagmeet Singh outlined his party’s goals in the next parliament.

“If you need medication in our country, we want to make sure you use your health card, not your credit card,” he said. “That means a national, publicly-delivered single-payer pharmacare program.”

Universal drug coverage would shake up the country’s C$39.8 billion ($30.4 billion) prescription drug market, and cut drugmakers’ revenue by some C$4.8 billion a year by 2027. It may draw opposition from drugmakers, and from private insurers, who could also lose revenue, as well as deficit hawks.

“We believe that any national pharmacare program must ensure Canadians maintain access to at least the same range of cutting-edge medicines they rely on today to survive and maintain their quality of life,” pharmaceutical industry group Innovative Medicines Canada said in a statement.

The Canadian Life and Health Insurance Association said it looks forward to working with the government.

“We continue to believe strongly that any reform should use government resources wisely and build on what works well today,” Canadian Life and Health Insurance Association President Stephen Frank said in a statement.

A DEAL WITH PROVINCES?

The Liberals promised a new national plan ahead of the election, but only committed a total of C$6 billion for all health initiatives. The NDP and the Green Party of Canada were more aggressive.

Earlier this year, the advisory council led by Hoskins, a former provincial Liberal minister, recommended a universal, single-payer public pharmacare system, to be implemented no later than 2027 and costing C$15.3 billion a year in new government spending.

But it said cost-saving measures, including new negotiating power with pharmaceutical companies, would reduce overall spending by an estimated C$4.8 billion by 2027, saving provincial governments, employers and individuals money at drugmakers’ expense.

The Liberals’ platform stopped short of pledging a single-payer system, which left some advocates unsure whether Trudeau was fully endorsing the Hoskins’ recommendation.

The NDP pledged to implement pharmacare for all as soon as possible.

To follow the Hoskins model, the federal government would need to strike a deal with provincial governments, to fund prescription drug plans as long as the provinces run plans that meet certain minimum standards.

The negotiations may be difficult, as key provinces are led by rival parties. But the promise of billions in new federal funding could make a deal possible. It is possible that some provinces would opt out, weakening the program, as lower participation means less bargaining power in buying drugs.

Morgan, of the University of British Columbia, expects pharmaceutical lobbyists to mobilize against the plan.

“I think we are going to see a lobbying effort by the pharmaceutical industry in Canada the likes of which we’ve never seen,” he added.

Additional reporting by Anna Mehler Paperny in Toronto and Evan Duggan in Vancouver; Editing by Denny Thomas and Paul Simao

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