Canadian Generic Pharmaceutical Association (CGPA)
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1 Canadian Generic Pharmaceutical Association (CGPA) October 2004 Generic Drugs. Same Quality. Lower Price.
2 Topics Generic pharmaceuticals Canada s generic pharmaceutical Industry Drug costs in Canada Generic drug prices Patented Medicines Regulations
3 Generic pharmaceuticals Generic drugs = low-cost versions of brand name drugs produced after patents expire No differences in quality, purity, effectiveness, and safety between generics and brands All drugs sold in Canada approved by Health Canada Each product must meet strict regulations of The Food and Drugs Act
4 Generic Drugs, Cont d Active ingredient in generic and brand must meet same scientific norms and standards Manufacturer must also prove active ingredients in the medicine are as pure, dissolve at same rate, and are absorbed in same manner as the original product Price is key difference
5 Generic Pharmaceutical Industry Jobs = 10,000 in Canada Innovation: $300-million+ annually on R&D (approx: 15% of sales) More than 100 products in development R&D expenditures increased more than seven-fold since 1990 More than $1-billion targeted for R&D over the next 3 years Exports: 20% of sales through export to 120 countries
6 Industry investment: Generic vs. Brand Generic industry employs 10,000 Canadians on $2.2-billion in sales Brand industry employs 23,000 Canadians on $12.5-billion in sales Generic industry spends $300-million+ on R&D on $2.2-billion in sales (approx. 15% of sales) Brand industry spends $1.1-billion on R&D on $12.5-billion in sales (less than 10% of sales)
7 The Canadian Prescription Drug Market 12 months ending June 2004 Generic 15.1% Generic 40.3% 84.9% 59.7% $14.83 billion Brand Brand 363 million Rx's Source:
8 Regional Market Share of Generic Sales 12 months ending June 2004 N.B 18.9% N.S. 19.3% PEI & Nfld. 21.2% 18.7% Canada: 15.1% 15.8% 17.2% 15.2% 15.1% 11.8% Source:
9 Generic Rx Penetration by Region 12 months ending June 2004 N.B 45.8% N.S. 43.4% PEI & Nfld. 46.7% 46.7% Canada: 42.1% 44.6% 44.1% 41.3% 35.7% 40.3% Source:
10 Ranking of Retail Prescriptions by Corporation Corporation 12 months ending June 2004 Rx s Market (000 s) Share Growth Total Market 363, Apotex 58, Pfizer 31, Novopharm 23, ratiopharm 16, J&J 16, Glaxo SmithKline 16, Pharmascience 15, Wyeth 15, AstraZeneca 14, Merck Frosst 13, Abbott 13, Genpharm 12, Aventis 10, Bristol-Myers Squibb 9, Schering-Plough 7, Note: Internet Sales are no longer included Source:
11 Average price per prescription % Increase Brand $33.41 $ % Generic $15.86 $ % Source IMS HEALTH Canada
12 Generic prices Canada vs. U.S. Data from independent research firm IMS HEALTH for 12-months ending September 2002 show Canadian generic prices 28% less than U.S. October 2003 study from Wharton School (Danzon and Furukawa) found Canadian generics priced less than U.S. and less than 9 other countries studied
13 Patented Medicines Regulations Canada has 20-year patent terms for pharmaceutical products international standard But, also have Patented Medicines (Notice of Compliance) Regulations Apply only to patent disputes in pharmaceutical industry
14 Patented Medicines Regs, cont d Allow brand companies to stop Health Canada approval by alleging patent infringement Don t have to go to court first automatic 24- month stay Brands list and litigate several patents on same basic medicine = evergreening Non-infringing generics kept off the market
15 Patented Medicines Regs, cont d Health Canada cannot issue final approval (NOC) until all disputes decided by courts Generics win 75-80% of court cases but brands still win have maintained market monopolies sometimes for years after expiry of basic patents Brands have initiated 340 court cases since Regulations came into force
16 Patented Medicines Regs, cont d Hurts generic drug makers no date-certain market entry to start recouping investments Added more than $1-billion to Rx drug costs in Canada since 1993 U.S. passed legislation in 2003 to limit brands to one automatic injunction per drug Romanow/Competition Bureau recommend review of evergreening
17 Patented Medicines Regs, cont d CGPA recommends eliminating Regulations Maintain 20-year patent terms Brands still have full legal rights to protect patents Canada still in full compliance with international trade agreements Save Canada approx. $100-million per year
18 National Pharmaceuticals Strategy
19 Strategy includes following 9 action items: Develop, assess and cost options for catastrophic pharmaceutical coverage Establish a common National Drug Formulary for participating jurisdictions based on safety and cost effectiveness Accelerate access to breakthrough drugs for unmet health needs through improvements to the drug approval process Strengthen evaluation of real-world drug safety and effectiveness Pursue purchasing strategies to obtain best prices for Canadians for drugs and vaccines Enhance action to influence the prescribing behaviour of health care professionals so that drugs are used only when needed and the right drug is used for the right problem Broaden the practice of e-prescribing through accelerated development and deployment of the Electronic Health Record Accelerate access to non-patented drugs and achieve international parity on prices of non-patented drugs Enhance analysis of cost drivers and cost-effectiveness, including best practices in drug plan policies
20 Thank you
Pharmaceutical sales in Canada have a 2.5 percent share of the global market, making th
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