Public hearings start Wednesday, Feb. 24 in Quebec City on Bill 81, “An Act to reduce the cost of certain medications covered by the basic prescription drug insurance plan by allowing calls for tender.” The presumed aim of this new intervention in the health-care sector is to lower the price of medication by giving the government the power to issue calls for tender to supply drugs sold in pharmacies.
In this way, the government wants to get manufacturers and wholesalers to compete. While this idea might seem like a good one at first glance, it could actually cause major problems in terms of access to quality health-care services, without generating the expected savings.
One of the main problems is the following: We can extend the bidding process and hope to generate savings, but this entails the risk that the single manufacturer that wins the contract might experience problems in its supply chain, which would in turn lead to drug shortages. In such a situation, no one gets their money’s worth — not governments, not taxpayers, and certainly not patients.
This opinion is even shared by Health Minister Gaétan Barrette’s assistant deputy minister, Luc Castonguay. In a confidential document made public in December, he wrote, “The potential for reduced drug costs now appears slimmer; the use of calls for tender increases the risk of supply disruptions; and finally, in the medium term, calls for tender could lead to less competition.”
This is just one of the risks associated with this bill. Among other things, it creates needless uncertainty and weakens the pharmaceutical sector, all while removing the freedom of choice of patients and pharmacists. Whereas many would like to see the system become more decentralized, this kind of policy centralizes decision-making even further.
In a recent open letter written on behalf of pharmacists from across the province and operating under all banners, three pharmacists reminded Barrette of a certain number of basic facts that deserve to be repeated.
First of all, the pharmacy network belongs to pharmacists, not to the state. It is owners who bear the costs and the financial risks, not the government. When it decides to force them to deal with certain drug manufacturers and wholesalers, it interferes with the running of private businesses. It’s as if from one day to the next, all Quebec garages, from Audi dealers to your neighbourhood mechanic, had to buy their brake pads from the same supplier.
Correct me if I’m wrong, but pharmacies in Quebec have not been nationalized. The government should therefore refrain from meddling in the private transactions that take place between insurance companies, pharmacies and the manufacturers of generic drugs, nor should it decide for pharmacists what they should buy, from whom, and at what price.
Bill 81 raises several questions:
- Does relying on a single company run the risk of generating shortages?
- Without competitors, who will exert downward pressure on the “monopoly” that wins the bidding process so that it doesn’t ratchet up prices? (Note, in this regard, that the cost of generic drugs has fallen in Quebec over the past five years.)
- Is the government not, in a way, expropriating pharmacists, who often have their own brands and distribution services?
- Could the winner of the bidding process be a foreign company, thus excluding Canadian companies from a part of the Canadian market?
- What are the dangers for a patient who has been treated for several years with a certain drug, and who will suddenly have to change if the company that supplies that drug does not win the call for tenders?
- Why remove the freedom of choice of patients and doctors? Is the health minister calling into question the judgment of health professionals and of those who consult them?
All of these questions remain unanswered by Health Minister Barrette. Let’s hope the parliamentary committee that is looking at the bill will be able to provide some answers.
Jasmin Guénette is Vice President of the Montreal Economic Institute. The views reflected in this column are his own.