Patent restoration and the cost of pharmaceuticals

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Patent Restoration and the Cost of Pharmaceuticals.pdf

With the signing of the free trade agreement with Europe (CETA), Canada extended market exclusivity by up to two years for some patented medicines. This report analyzes the increased annual costs for Canadians from that change. If the extended protection had been in place in 2015, and applied to “innovative” drugs available at that time, the additional annual cost would have been $392 million. The cost rises to roughly half a billion dollars when including drugs that were likely to have been eligible, but are not covered in the database used for this analysis. For provinces, their public plans would have had to pay an additional $214 million annually – which would have had a fiscal impact for the federal government.

Projection of future costs is difficult since only new drugs that became available after September 2017, will be eligible for the change. Nonetheless, given trend historical increases in drug costs for new medicines, the annual cost of the change is most likely to increase – accumulating over time.  

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    This paper estimates the cost to the federal government of implementing this particular framework for Pharmacare.

    Figure 1-3 updated 2017-11-07