CETA will result in higher drug costs for Canadians: study

October 31, 2013

OTTAWA—The Comprehensive and Economic Trade Agreement (CETA) will result in significantly higher drug costs for Canadians, says a study released today by the Canadian Centre for Policy Alternatives (CCPA).

The study examines the latest revelations about the tentative trade agreement and finds it will:

  • commit Canada to creating a new system of patent term extension that will delay the entry of generic medicines by up to two years;
  • lock in Canada’s current terms of data protection, making it difficult or impossible for future governments to reverse them; and
  • implement a new right of appeal under the patent linkage system that will create further delays for the entry of generics. 

“On a per capita basis, Canadian drug costs are already the second highest in the world, after the United States. Under CETA, drug costs to Canadians are estimated to increase by between $850 million and $1.6 billion annually,” says Marc-André Gagnon, assistant professor in the School of Public Policy and Administration at Carleton University and one of the study’s co-authors. 

According to the study, the federal government has promised to compensate the provinces for any additional costs related to CETA. However, that simply means that instead of Canadian taxpayers paying at the provincial level, they will be paying at the federal level. Importantly, people paying for their drugs out-of-pocket or through private insurance will be hit twice—through higher drug costs and their federal taxes.

“As drug costs continue to grow, there are limited choices: restrict the choice of medicines that the provinces can offer to their citizens; place more of the burden of costs on individuals, typically the elderly and the sick; or take money out of other places in the health system thereby threatening the viability of Medicare. Canadians should not have to accept any of these choices,” says Dr. Joel Lexchin, emergency physician and professor in the School of Health Policy and Management at York University, and co-author of the study.

“While we still don’t know all the details of the CETA, one thing is clear: the agreement will seriously impact the ability of Canadians to afford quality health care,” concludes Dr. Lexchin.


CETA and Pharmaceuticals: Impact of the free-trade agreement between Europe and Canada on the costs of patented drugs is available on the CCPA website: http://policyalternatives.ca

For more information contact Kerri-Anne Finn, CCPA Senior Communications Officer, at 613-563-1341 x306.