Canadian drug plan pricing of generic drugs is in a state of flux, with different plans adopting different approaches. The manner in which public plans pay for generic drugs can affect five policy goals: low generic drug prices, security of the drug supply, a reliance on reimbursement rules (thereby avoiding the need for drug plan managers to exercise discretion over reimbursement levels), low administrative burden and finally, the provision of adequate incentives for generics to enter the market. We review five pricing mechanisms: maximum prices, tiered pricing, tendering, benchmarking and pharmacy competition. We examine international evidence on the success of the first three of these. We conclude with an assessment of promising reimbursement approaches.
GrootendorstP. Beneficiary cost sharing under Canadian provincial prescription drug benefit programs: history and assessment. Can J Clin Pharmacol2002; 9: 79–99.
3.
FuldaTKDickensPF. Controlling the cost of drugs: the Canadian experience. Health Care Financ Rev1979; 1: 55–64.
4.
MorrisonABCookDCasselmanWG. Clinical equivalency: a health protection branch perspective. Can Med Assoc J1973; 109: 806–808.
Bailey K, Grills R and Preston M. Report of the Ontario Drug Benefit Formulary Pricing Committee. 1978 (Unpublished).
9.
Gorecki P. Regulating the price of prescription drugs in Canada: compulsory licensing, product selection, and government reimbursement programmes. Technical report, no. 8. Ottawa: Economic Council of Canada, 1981.
10.
GoreckiP. A comparison of two drug reimbursement pricing models: B.C. Pharmacare and the Ontario Drug Benefit Programme. Can J Econ1993; 26: 867–877.
11.
AnisAHGuhDPWoolcottJ. Lowering generic drug prices: less regulation equals more competition. Med Care2003; 41: 135–141.
DuffinJ. Canadian drug shortage: recent history of a mystery. CMA J Can Med Assoc J2012; 184: 1000–1000.
18.
MacIsaacA. Intellectual property rights and pharmaceutical trade dress: options for protecting the appearance of prescription drugs. Biotechnol Law Rep2014; 33: 108–114.
19.
GreeneJAKesselheimAS. Why do the same drugs look different? Pills, trade dress, and public health. N Engl J Med2011; 365: 83–89.
20.
KapczynskiAParkCSampatB. Polymorphs and prodrugs and salts (Oh My!): an empirical analysis of “Secondary” pharmaceutical patents. PLoS ONE2012; 7: e49470–e49470.
21.
GrootendorstPBouchardRHollisA. Canada’s laws on pharmaceutical intellectual property: the case for fundamental reform. Can Med Assoc J2012; 184: 543–549.
22.
AnisAHarvardSMarraC. Ontario’s plunging price-caps on generics: deeper dives may drown some drugs. Open Med2011; 5: e149–e152.
Danzon P and Furukawa M. Cross-national evidence on generic pharmaceuticals: Pharmacy vs. Physician-Driven Markets, www.nber.org/papers/w17226 (2011, accessed 26 February 2014).
27.
Patented Medicine Prices Review Board. Generic drugs in Canada: price trends and international comparisons, 2007, Ottawa, www.pmprb-cepmb.gc.ca/english/View.asp?x=1419&mp=124 (2010, accessed 19 December 2012).
28.
HollisA. The importance of being first: evidence from Canadian generic pharmaceuticals. Health Econ2002; 11: 723–734.
29.
ShajarizadehAGrootendorstPHollisA. Newton’s first law for pharmacies: why entry order matters for generics. Int J Econ Bus2015; 22: 201–217.
30.
PicardA. Patent expiry for some blockbuster drugs presents huge saving opportunity. The Globe and Mail. 6 2012 September, 2012(02/22).
VoglerS. The impact of pharmaceutical pricing and reimbursement policies on generics uptake: implementation of policy options on generics in 29 European countries-an overview. Generics Biosimilars Initiative J (GaBI J)2012; 1: 93–100.
Boonen LH, van der Geest SA, Schut FT, et al. Pharmaceutical policy in the Netherlands: from price regulation towards managed competition. In: Dor A (ed) Pharmaceutical markets and insurance worldwide, Advances in health economics and health services research, vol. 22. Bingley: Emerald, 2010, pp.53–76.
