Generic drug industry tries desperately to protect an indefensible business
model in Quebec

OTTAWA, June 30 /CNW Telbec/ - Canada's Research-Based Pharmaceutical Companies (Rx&D) responded today to assertions by the Canadian Generic Pharmaceutical Association (CGPA) that the Government of Quebec's support for the brand-name drug industry is detrimental, given the importance and inestimable value of innovation to Quebec's health and prosperity.

"By requiring the generic drug industry to reduce its excessive prices, the government is doing its job to ensure the sustainability of Quebec's Prescription Drug Insurance Plan," stated Rx&D president Russell Williams, noting that the generic drugs sold in Canada are among the most expensive in the world. The Fraser Institute and the Competition Bureau of Canada corroborate this, while the Bureau goes even further by maintaining that if generic drugs were sold at a competitive price in Canada, patients and drug insurance plans would save over $800 million a year.

Brand-name medicine prices, which are controlled by the Patented Medicine Prices Review Board (PMPRB), are below the international median. "We shouldn't let ourselves be distracted from the real issue here - that generic drugs cost too much. Quebec is exercising its right to reimburse the lowest price in the country and as such is aligning its reimbursement policy with that of other provinces, like Ontario," added Mr. Williams.

The 15 Year Rule - heavily criticized by the CGPA - is a provision specific to Quebec that acknowledges the risk tied to innovation by providing reimbursement for new medicines for a period of 15 years from their listing on Quebec's drug formulary, regardless if the patent expires or a generic equivalent exists. While this measure carries costs for Quebec's Prescription Drug Insurance Plan, a study by Quebec Ministry of Finance(1) indicates that the benefits largely outweigh the costs: abolishing the rule would lead to a recurring loss of $340 million per year in Quebec's gross domestic product (GDP) due to reduced investments and job losses in the life sciences sector.

The research-based pharmaceutical industry has a special relationship with Quebec thanks to its historic decision to develop a strong knowledge-based economy that will create wealth and usher in a bright future. This societal choice has been a profitable one, as Quebec garners 45% of all pharmaceutical research investment in Canada, even though it represents less than 25% of Canada's population, is home to 28 international pharmaceutical companies, and boasts the largest concentration of pharmaceutical headquarters in Canada, as well as the production and research activities of 12 of the 15 largest pharmaceutical groups in the world.

Over the years Rx&D member companies have forged partnerships with many Quebec universities and hospitals with a view to promoting pharmaceutical research. This has led to a variety of clinical trials, new research chairs like those on obesity at Université Laval and cardiovascular disease at McGill University, and a nurse practitioners program at the latter institution.

"In addition, since the Drug Policy came into effect in 2007, these same companies have invested several hundred million dollars in the construction, expansion, and renovation of various research facilities. These funds would probably have been channeled elsewhere if not for the long tradition of partnership between the research-based pharmaceutical industry and the Quebec government, and the importance of Quebec for our industry," said Mr. Williams. He concluded by stating that "all the partnerships we have formed with healthcare stakeholders - including physicians, nurses, and pharmacists - are aimed at ensuring an efficient healthcare system that benefits patients, who must remain a priority for all."

About Rx&D

Rx&D is the association of leading research-based pharmaceutical companies dedicated to improving the health of Canadians through the discovery and development of new medicines and vaccines. Our community represents 15,000 men and women working for 50 member companies and invests more than $1 billion in research and development each year to fuel Canada's knowledge-based economy. Guided by our Code of Ethical Practices, our membership is committed to working in partnership with governments, healthcare professionals and stakeholders in a highly ethical manner.

    (1) Ministère des Finances du Québec, Les impacts économiques de la
        "règle des 15 ans" appliquée au remboursement des médicaments
        innovateurs au Québec, travaux de recherche 2005-002

SOURCE Canada's Research-Based Pharmaceutical Companies (Rx&D)

For further information: For further information: François Lessard, Communications, Telephone: 613.236.0455, E-mail:

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