United States President Donald Trump’s focus on trade and tariff deals extends to pharmaceuticals. Canada must pay attention because his approach will pressure drug companies and governments to increase prices worldwide.

Trump’s strategy includes using Most Favoured Nation status, requiring drug companies to match the lowest price abroad when selling in the United States. For example, the United Kingdom has already agreed to pay up to 25 per cent more for new medicines, and increase spending on innovative medicines from 0.5 to 0.6 per cent of gross domestic product over the next decade as part of a zero-tariff trade deal with the U.S.

Canada has a long tradition of freeloading on American science, defence, and security, including the development of innovative medicines. If Canada continues current practices that delay and deny access to new medicines and control drug prices, Canadians’ access to new drugs is highly likely to worsen.

Consider the present bureaucratic mess that patients face.

Long wait times to access new medicines are due to processes used to assess the value of drugs, negotiate their prices, and make them available via government drug plans.

Canada has two organizations estimating the “value” of new medicines. Canada’s Drug Agency (CDA) makes recommendations to all government drug plans, except those in Quebec which receive recommendations from the Institut national d’excellence en santé et en services sociaux, about whether new drugs should be reimbursed. Next, prices for new medicines are negotiated with drug developers by the pan-Canadian Pharmaceutical Alliance (pCPA) on behalf of government drug plans.

These organizations are too slow. CDA’s performance target is 180 days. Yet only two per cent of 344 CDA reimbursement recommendations issued between 2020 and 2024 were completed within six months. On average, the agency took more than eight months to make recommendations. Nearly three out of 10 recommendations took over nine months. Almost all (99 per cent) of the reimbursement recommendations were conditional on clinical criteria about how the medicine should be used, a price reduction, or both.

Once CDA issues a recommendation to reimburse a drug, it doesn’t guarantee quick action at the next stage. The pCPA then invites manufacturers to negotiate prices. Its performance target for invitations is 40 business days (two months) and 90 business days (or four and a half months) to complete price negotiations. Yet, between 2020 and 2024, less than one fifth of invitations and only half of the negotiations were completed on time.

The result is an average time delay from submission to CDA to pCPA negotiation completion of 18 months; 15 per cent took two years or more. If Canada doesn’t take actions like the United Kingdom to attain Most Favoured Nation status, delays will likely be even longer as companies deprioritize launching their new drugs here.

The average Canadian may consider these delays acceptable. Certainly, CDA and the pCPA don’t see a problem as they self-justify against any criticism of the time they take. Some modest revisions in timelines are planned by CDA, but for patients who want access to new medicines – which could be effective against aggressive cancers or rapidly disabling conditions like ALS – the changes are unlikely to make the much needed significant improvements.

Delays in accessing medicines don’t end with these two bodies.

Medicines recommended for reimbursement and successfully price negotiated aren’t automatically added to government drug lists. Governments can negotiate additional commitments from drug developers, causing further delays, and may still decide not to add medicines to their lists. Listing rates for medicines with a successful pCPA price negotiation varied across government plans from 59 to 92 per cent. Canada’s postal code lottery of inequitable access to prescription drugs continues.

Waiting for CDA, pCPA, and government drug plans is on top of delays caused by applications to Health Canada usually being submitted a year after submissions in the United States and the European Union and the time taken by Health Canada to review and approve medicines (about a year). All the delays mean most Americans and some Europeans have access long before Canadians.

The delays and denials in access and requirements for price reductions are likely to be seen by Trump as yet another irritant from Canada. His Most Favoured Nation status requires just the opposite: higher prices and fewer deterrents for manufacturers.

Nigel Rawson is a senior fellow at the Macdonald-Laurier Institute.

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