Prime Minister Justin Trudeau and Minister of Finance Bill Morneau arrive in the Foyer of the House of Commons to table the Budget, on Parliament Hill in Ottawa on Tuesday, March 19, 2019. (Justin Tang/The Canadian Press)

BUDGET 2019: Liberals to create national drug agency for pharmacare plan

Canada’s current patchwork of drug coverage is not well equipped to handle increasingly expensive drugs

The Trudeau Liberals’ new budget promises a new agency to buy drugs in bulk and cut Canadian medication costs, the first step toward a national drug plan.

In a sign of just how expensive pharmacare could be, the government is also promising to spend $500 million a year, starting in 2022, just on subsidizing drugs that treat rare diseases, which have few patients to split huge research and development costs.

The government said it intends to work with provinces, territories and other partners to develop the mandate for the national drug agency, with Health Canada to receive $35 million over four years starting in 2019-2020 to create an office to support the plan.

The budget also includes plans to create a national formulary, a list of drugs that have been evaluated for both efficacy and cost-effectiveness. Lower-tier governments now assess drugs on their own, duplicating much of the work.

Despite clear language in the budget on how the government eventually intends to move ahead on a pharmacare plan, a central question remains: how to pay for it.

A universal pharmacare plan does not appear affordable for Canada right now, said Rebekah Young, the director of fiscal and provincial economics for Scotiabank. She said adding such a plan to the government’s books without major tax hikes would require stronger growth than Canada sees even in the best of times.

Provinces do not have a lot of capacity to take on substantial new costs, she said, noting the parliamentary budget office has estimated the cost of a pharmacare plan at about $20 billion a year.

“The big question then becomes who is going to pay and how much?” she said. “That will definitely be a key feature of the summer debate when we head into the election.”

The federal New Democrats have promised that if elected, they would follow through on a universal pharmacare plan to respond to dramatic increases in prescription drug costs.

READ MORE: As deficit grows, feds spend on job retraining, home incentives

Over the past three decades, Canadians’ spending on medication has soared from $2.6 billion in 1985 to $33.7 billion in 2018. People take more drugs to manage more conditions than they used to — living longer, and better, but at considerable cost.

The Canadian Institute for Health Information says drugs are the fastest-growing component in health spending but that most people’s medication needs aren’t covered by public health insurance, unlike care provided in hospitals and through visits to the doctor.

Canada’s current patchwork of drug coverage — including more than 100 public programs and 100,000 private insurance plans — is not well equipped to handle the increasingly expensive drugs now coming to market, the government said in its budget document.

“Absorbing these rising costs is difficult for individual Canadians and their families — and poses challenges to the long-term sustainability of government- and employer-sponsored drug plans,” it said.

The steps toward pharmacare contained in Tuesday’s budget follow interim findings issued by a federal expert panel led by former Ontario health minister Eric Hoskins.

It recently issued a report on the “building blocks” of pharmacare, including a recommendation that Ottawa oversee an agency to roll out a national drug plan.

The interim report said drug spending in Canada is expected to surpass $50 billion by 2028.

At the time of its release, British Columbia Health Minister Adrian Dix described the panel’s interim report as encouraging, but said the federal government would need to “step up.”

“It’s very positive to see the interim report, but ultimately this issue will be about whether the federal government is prepared to cost-share or not,” he said.

Hoskins’ advisory council is set to issue a final report on the issue of access to drug coverage this spring, with the findings to be tabled in the House of Commons.

Kristy Kirkup, The Canadian Press

Like us on Facebook and follow us on Twitter.

Just Posted

How to judge the sand sculptures like a pro at the 2019 Parksville Beach Festival

World-class arbiter gives insight on how to choose a winner

Developers go back to drawing board after high-rise application deferred by Parksville council

IAG Developments has proposed a multi-building development on city’s waterfront

Parksville man dies from rabies after contact with Vancouver Island bat

Nick Major, 21, was a taekwondo instructor at Cascadia Martial Arts in Parksville

WATCH: Parksville Qualicum MLA Michelle Stilwell takes first extended steps in nearly three decades

‘It actually felt like walking. It’s been 27 years… but it felt realistic to me’

City of Parksville warns of utility-payment phone scam

City says phone scammers are impersonating city staff demanding past-due cash

WATCH: Parksville Qualicum MLA Michelle Stilwell takes first extended steps in nearly three decades

‘It actually felt like walking. It’s been 27 years… but it felt realistic to me’

Gas price inquiry questions Trans Mountain capacity, company denies collusion

The first of up to four days of oral hearings in the inquiry continue in Vancouver

‘Benzos’ and fentanyl a deadly cocktail causing a growing concern on B.C. streets

Overdoses caused by benzodiazepines can’t be reversed with opioid-overdose antidote naloxone

Chinook retention begins on North Island, but amid new size limit

DFO calls measures ‘difficult but necessary’ following rockslide on Fraser River

Will you be celebrating national hotdog day with any of these crazy flavours?

The popularity of hotdogs spans generations, cultures

Former home of accused Penticton shooter vandalized

Ex-wife of man who is accused of murdering four people had her house vandalized

Injured humpback returns to waters near Comox a year later

Photographer spotted Ocular near Comox again and noticed the whale has been healing

Survivor of near-drowning in B.C. lake viewing life through new eyes

“If I died that day, the baby wouldn’t know his dad,” said 31-year-old Mariano Santander-Melo.

‘Beyond the call’: Teen in police custody gets birthday surprise by B.C. Mountie

Unusual celebration started when Staff Sgt. Paul Vadik went to visit the teen in his Coquitlam cell

Most Read