Longer drug monopolies in Canada do not result in increased domestic R&D
TORONTO, Nov. 4, 2013 /CNW/ - New data on pharmaceutical research and
development spending in Canada provides further proof that no link
exists between longer market monopolies for brand-name drug companies
and increased domestic investments, Jim Keon, President of the Canadian
Generic Pharmaceutical Association (CGPA) said today.
The recently released annual report from the federal government's
Patented Medicine Prices Review Board (PMPRB) shows that in 2012 member
companies of Canada's Research-Based Pharmaceutical Companies (Rx&D)
spent only 6.6 percent of their Canadian revenues on research and
development in Canada. This marks the 10th consecutive year that Rx&D
member companies have broken their promise to spend at least 10 percent
of their domestic sales on research and development.
The PMPRB also reports that total research and development expenditures
by member companies of Rx&D were lower in 2012 than in any year since
1989. Total research and development spending by Rx&D members in 2012
declined by 13.1 percent from 2011. Basic research, which could lead to
the discovery of new medicines, decreased by 30.5 percent from 2011 to
The PMPRB's findings are highlighted in a new report released today by
CGPA. Copies of The Real Story: R&D Spending by Brand-Name Drug Companies in Canada:
1988 - 2012 are available at www.canadiangenerics.ca.
"In Canada, market monopolies for brand-name drug companies have
increased no fewer than eight times since 1987, yet investments are
declining toward record lows," Keon said.
On October 18, 2013 Canada and the European Union (EU) announced an
Agreement in Principle in the negotiations for a Comprehensive Economic
and Trade Agreement (CETA), which includes more needless and costly
increases to market monopolies for brand-name drug companies in Canada.
Keon said that, while the pharmaceutical intellectual property
provisions announced in the agreement fall short of the EU's original
demands on behalf of brand-name drug companies, they will still delay
market entry of cost-saving generic prescription medicines in Canada in
the future, increasing health-care costs for provinces, employers that
sponsor drug plans for their employees and Canadians who pay for their
prescription medicines out-of-pocket. The full cost to Canadians of the
actual delays in generic drug competition resulting from the new
measures will depend on the specific manner in which they are
implemented by the Government of Canada.
Keon noted that while most brand-name drugs sold in Canada are shipped
into the country, the majority of generic drugs sold in Canada are
domestically produced. The majority of the pharmaceutical manufacturing
capacity that exists in Canada is generic.
"A dollar spent on a generic drug supports more jobs, more R&D
investment, and more investment in pharmaceutical manufacturing
capacity in Canada than a dollar spent on a brand-name drug," he said.
The generic pharmaceutical industry employs more than 12,000 Canadians
in well-paid, highly skilled jobs in research and development,
manufacturing and other operations. Generic pharmaceutical companies in
Canada invest approximately 15 percent of sales in research and
development. Canada's generic drug industry generates 40 percent of its
sales volume from exporting made-in-Canada pharmaceuticals, primarily
to the United States.
About the Canadian Generic Pharmaceutical Association
The Canadian Generic Pharmaceutical Association (CGPA) represents
Canada's generic pharmaceutical industry. The industry plays an
important role in controlling health-care costs in Canada. Generic
drugs are dispensed to fill 65 per cent of all prescriptions but
account for account for only 24 per cent of the $22-billion Canadians
spend annually on prescription medicines.
SOURCE: Canadian Generic Pharmaceutical Association
For further information:
Vice President, Corporate Affairs
Canadian Generic Pharmaceutical Association (CGPA)
Tel: (416) 223-2333
Mobile: (647) 274-3379