The newest annual report from the Patented Medicine Prices Review Board (PMPRB) has been tabled by Canada’s federal health minister with the clerks of the Senate and the House of Commons. In the report, the PMPRB says sales of patented medicines in 2023 were $19.9-billion, accounting for approximately 47 per cent of all medicine sales in Canada. Spending on patented medicines in 2023 was 8.2 per cent higher than spending in the previous year.
“Patented medicines accounted for 47.3 per cent of the sales of all medicines in Canada in 2023, down from a peak of 72.7 per cent in 2003 and a slight decrease from 49 per cent in 2022,” the annual report states. “This percentage has generally declined since 2019, even as overall spending on patented medicines continues to trend upwards. This indicates that sales of non-patented brand and generic medicines have grown at a faster rate than sales of patented medicines in recent years.”
Excess revenues
According to the annual report, 1,146 patented medicines were reported to the PMPRB in 2023, including 86 new medicines. Five undertakings to voluntarily lower the price of a medicine or pay potential excess revenues to the Government of Canada were accepted during the year. Undertakings for potential excess revenues resulted in payments to the government totaling more than $2.1-million.
Canadian list prices for patented medicines remain higher than all 11 of the reference countries the PMPRB follows, while Canada is the fourth highest-paying country among the 31 Organisation for Economic Co-operation and Development (OECD) countries. The national list price for patented medicines increased 0.7 per cent in 2023. Approximately 84 per cent of the patented medicine sales in Canada were for medicines with a list price higher than the PMPRB reference countries while 25 per cent were for medicines with a list price that topped the highest prices reported in all 11 countries.
Established by Parliament in 1987, the PMPRB’s mandate is to protect and inform Canadians by ensuring that the prices of patented medicines sold in Canada are not excessive. The board reported no failure to file orders issued and no failure to file hearings were commenced as of March 2024.
Drug company research
The report also looks at the research being invested in by drug companies – it says rights holders spent more on research and development in 2023 when compared to 2022, but the ratio of research and development to sales in Canada remains “substantially below” that of the board’s 11 comparator countries. In 2023, the board notably removed the United States and Switzerland from the list, adding Australia, Belgium, Japan, the Netherlands, Norway and Spain, to bring the total number of countries from seven to 11.
Since 1987, pharmaceutical costs in Canada have grown at an average annual rate of 6.6 per cent; pharmaceutical expenditures make up 13.9 per cent of total healthcare spending, they state.
“Spending on all prescription drugs in Canada in 2023 was estimated to be just over $41-billion. Of this, 43 per cent was paid for by the public sector, 37 per cent by private insurers and 20 per cent out of pocket by Canadians,” they write.
The PMPRB’s budget, meanwhile, is estimated to be $17.1-million in 2023 and 2024. This is estimated to rise to more than $17.7-million in the coming year.
Canadian sales made up two per cent of the global market for drug sales in 2023. This, they say, makes Canada the ninth largest national market for pharmaceuticals in the world.
