Drug System Reforms
Your Questions Answered
- What exactly is changing in Ontario’s drug system?
- Why now?
- How will these changes benefit me?
- How much money will this save the government?
- Will pharmacy services suffer?
- Do these changes mean I’ll pay more for drugs?
- Does this mean fewer drugs will be covered?
- Why do Ontarians pay more?
- What are professional allowances?
- What are the professional allowances for?
- How many pharmacies are located in Ontario?
What exactly is changing in Ontario’s drug system?
The government has taken action to lower the cost of most generic drugs by at least 50% to a maximum of 25% of the reference brand price. This plan for fair drug prices will:
- Provide more support (new funding) for pharmacies in rural and underserviced areas of the province
- Eliminate professional allowances to provide more accountability to the drug system
- Increase dispensing fees for pharmacists and pay them directly for the important clinical pharmacy services they provide.
Why now?
Ontario pays some of the highest prices for generic drugs in the world.
We pay as much as five times more than some US states for popular generic drugs for diabetes, high blood pressure and other health conditions.
This is money we could put to better use covering more drugs and investing in our health system. That’s why the government has moved to drop the cost of most generics by at least 50%. This means :
- Better access to cheaper medications,
- A stronger, more accountable health care system.
How will these changes benefit me?
Lowering the cost of generic drugs will save taxpayers millions. Specifically, the changes will :
- Lead to better access to lower-cost drugs
- More drugs covered by the government, and
- A stronger, more accountable health care system.
How much money will this save the government?
The changes will save about $500 million a year. Every dollar will be reinvested in Ontario’s health care system.
Will pharmacy services suffer?
The government will invest nearly $250 million each year to:
- Increase the dispensing fees paid to pharmacists
- Compensate pharmacists directly for important clinical pharmacy services they provide to patients
- Boost financial support for pharmacies in rural communities and underserviced areas.
Do these changes mean I’ll pay more for drugs?
No. The changes will make more drugs available, at a lower cost.
Does this mean fewer drugs will be covered?
No. Our plan would expand the number of drugs available to patients in Ontario.
Why do Ontarians pay more?
The money paid to pharmacies by generic drug manufacturers for stocking their products inflates the cost of drugs.
In fact, in some cases, Ontario pays up to 22 times the price paid in other countries for certain generic medications.
What are professional allowances?
Professional allowances are monies paid to pharmacies by generic drug companies for the purposes of providing direct patient services.
What are the professional allowances for?
The money paid to pharmacies by generic drug companies for stocking their products — an estimated $750 million in 2009 — are supposed to support direct patient services.
Pharmacies themselves have reported that 70 per cent of professional allowances went toward fringe benefits, bonuses, overhead costs and boosting profits.
During this same reporting period, as many as 100 individual pharmacies have failed to disclose any documentation whatsoever related to the professional allowances they’ve collected.
Independent audits also found that some pharmacies and wholesalers were even involved in a ‘resale’ scheme that triggered multiple payments for the same product.
How many pharmacies are located in Ontario?
Approximately 3,400 pharmacies exist in Ontario — an increase of 445 since 2006.
For More Information
Call ServiceOntario, Infoline at 1-866-532-3161
TTY 1-800-387-5559.
In Toronto, TTY 416-327-4282
Hours of operation : 8:30am - 5:00pm
If you are a member of the media, call Communications and Information Branch at 416-314-6197, go to http://drugreforms.mohmedia.ca/ or visit our News Room section.
