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Improving Access to Affordable Drugs Last week, our government announced some important reforms to the prescription drug system that will provide better access to lower-cost generic drugs for patients.

You might not realize it, but you pay more for generic drugs in Ontario than you would in most other countries around the world. That is why the Ontario government is working to cut these costs and clean up a system that needs reform.

We are now proposing new reforms to bring transparency to the system and lower the cost of generic drugs. As part of these proposed changes, we would increase the support we offer to pharmacists and, in particular, provide new funding to support pharmacists in rural communities. These changes include:
  • Lowering the cost of generic drugs for Ontario’s public drug system – as well as for all those in private employer drug plans, and people who pay for drugs out-of-pocket to no more than 25 per cent of the cost of the original brand name drug; 
  • Ensuring pharmacists are fairly compensated for helping patients by increasing dispensing fees and investing $150 million for additional services provided to patients; 
  • Eliminating the ‘professional allowances’ drug companies pay to make Ontario’s drug system more transparent; and 
  • Supporting access to pharmacy services in rural communities and under-serviced areas with new dedicated funding.
At the heart of these changes is the elimination of a system of payments that generic drug manufacturers pay to pharmacies. These payments – technically referred to as ‘professional allowances’ – were designed to cover the costs of patient care. However, careful monitoring of the system has revealed widespread abuse with as much as 70 per cent of these payments going toward fringe benefits, bonuses and overhead instead of patient services. Even worse, audits have found that some pharmacies and wholesalers were involved in a ‘re-sale’ scheme which triggered the payment of professional allowances multiple times for the same product.

We know that pharmacists play an important role in delivering health care in our communities. That is why we are immediately raising dispensing fees and are providing direct support to pharmacists to compensate them for the work they do.

By cleaning up this abuse, we will save Ontario taxpayers half a billion dollars annually. This is money that the government will re-invest in health care for hospitals, community health, long-term care beds, and nurses. Most importantly, these savings will be used to put more life saving drugs (such as cancer drugs) on the public formulary for Ontarians.

All Ontarians deserve access to affordable drugs. These reforms will make our drug system more transparent and affordable for everyone.