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Swallowing the costs



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Drug companies currently get about a six year lead time in the market before other generic brands can start marketing similar medicines. They argue that this isn’t enough time to recoup their investment and are currently lobbying to have their patents extended to about 25 years. Before his defeat in 1993, Prime Minister Brian Mulroney’s government approved Bill C-91, which effectively gave pharmaceutical companies up to 20 years, although this is dated to the time the drug is patented, not to the drug’s release, which could be anywhere from 10 to15 year later. Because every province evaluates a drug individually before it’s approved and added to the formulary, that can cut additional years off a company’s lead time.

If drug companies are successful, it could easily cost Canadians billions more each year by taking the generic option away.

Some citizen’s groups favour a tax increase. The federal government is itself looking at creating a national drug program because pharmaceuticals are becoming indivisible from Medicare – they were left out of big picture in the past because they weren’t nearly as common.

Employers currently bear the brunt of drug spending, which represents as much as four per cent of payroll expenses – and those costs are increasing by five to 10 per cent annually.

Drug companies oppose a national drug program on the basis that it will increase the use of less expensive remedies, reduce the use of more expensive remedies, and tighten restrictions on prices which the pharmaceutical industry needs to keep high to recoup their investments. They believe it will also limit doctors and their ability to prescribe the best drug for patients.

Other groups, which favour two-tier health systems, are opposed to the national drug program on the basis that it will increase taxes for everybody for the benefit of the few. The basis of two-tier systems is that you and your insurer pay only for what you need, receiving the best of everything, and not for what everyone else needs.

Either way, the price of medical care will go up – most experts feel that we should be paying more for the level of service we have come to expect, anyway, and that the Medicare system is starving the entire health industry by keeping costs down.

In British Columbia – which has recently increased health care spending by 13 per cent, most of which will go towards raises and incentives for doctors, nurses and other health professionals – the reduction of drug costs is being looked at as a priority in getting health finances in order.