MONTREAL, June 5, 2013 /CNW Telbec/ - The obsession with reducing public
spending on prescription drugs, which takes the form of constantly
falling price caps, bulk purchasing strategies and reimbursement
restrictions, entails numerous unintended consequences, especially for
the health of Canadians. These are the findings of a new study from the
Montreal Economic Institute (MEI).
"We can't blame governments for wanting to control their budgets, but
constantly shrinking expenditures on prescription drugs involves risks
that cannot be ignored. It has been shown that it lengthens delays in
getting access to new treatments, significantly increases the
likelihood of shortages and slows innovation," points out Yanick
Labrie, economist and author of the Research Paper published today.
The governments of Great Britain and New Zealand are often cited as
examples for their success in controlling prescription drug spending.
These countries do indeed spend less, but they also have to make do
A study published in 2012 places Canada's public plan at the bottom of
the list in terms of reimbursement for cancer drugs, while England and
New Zealand fare even worse, with scores of 38% and 25% respectively.
And England has lower cancer survival rates than other developed
countries, a tragic state of affairs likely due in part to drug price
For each dollar spent on drugs, overall health care spending is reduced
by a total of between $2.06 and $2.65. More recent patented drugs lead
to even greater savings, by reducing the need for surgeries, for
instance. Mr. Labrie argues that the health budget must be considered
as a whole, instead of focusing our attention exclusively on drug
The author also cautions against the inherent dangers of creating a
pan-Canadian drug insurance plan, a system that would only exacerbate
our current problems. "Our system is not perfect, but the presence of
multiple private and public insurers, which cover over 98% of the
population, offers people choice in securing appropriate coverage and
provides quicker access to new drugs. Socializing a larger proportion
of drug spending through the creation of a pan-Canadian plan would
expose Canadians to the decisions of a single organization that would
decide whether or not to reimburse a given treatment, which would
result in lower quality coverage," concludes Mr. Labrie.
The Research Paper entitled Wrong Prescription: The Unintended Consequences of Pharmaceutical Cost
Containment Policies was prepared by Yanick Labrie, economist and health policy analyst at
the MEI. This work is available at www.iedm.org.
The Montreal Economic Institute is an independent, non-partisan,
not-for-profit research and educational organization. Through its
publications and conferences, the MEI stimulates debate on public
policies in Quebec and across Canada by proposing wealth-creating
reforms based on market mechanisms.
SOURCE: MONTREAL ECONOMIC INSTITUTE
For further information:
Ariane Gauthier, senior advisor, communications, Montreal Economic Institute
Tel.: 514 273-0969 ext. 2231 / Cell: 514 603-8746 / Email: email@example.com