Social Policy in Ontario

Drug spending slowing: report

Posted on April 23, 2010 in Health Debates

Source: Toronto Star — Authors: Theresa Boyle

TheStar.com – Ontario – Canada spent an estimated $30 billion on drugs last year
Published On Thu Apr 22 2010.   Theresa Boyle Health Reporter

As the provincial government tries to rein in drug spending, a national report shows Ontario was the only province or territory where public funding for prescribed drugs fell last year.

The per capita cost of publicly funded drugs was $330.79 in Ontario in 2009, according to the report from the Canadian Institute for Health Information. That’s 0.8 per cent lower than the previous year. The other 12 provinces and territories all saw increases, with an average hike of 3.2 per cent. Nationally, the per capita average for spending on publicly funded drugs was $339.66.

Ontario is embroiled in a battle with pharmacists over its plans to slash the price of generic drugs by banning millions in payouts from drug companies to pharmacies.

When private spending on prescribed drugs is factored in, Ontario was still at the bottom of the list for growth in spending between 2008 and 2009. The provincial increase was 2.7 per cent, while the average national increase was 4.8 per cent.

Michael Gaucher, manager of pharmaceuticals for CIHI, said there could be many reasons for the drop in Ontario, such as ongoing efforts by the province to contain drug costs. It could also be a reflection of a healthier population, perhaps because of other policy changes affecting disease prevention and health promotion, he added.

Despite the decrease, Ontario ranks just slightly above the national average in the proportion of total health spending devoted to drugs. In 2009, 16.5 per cent of health spending in Ontario went to drugs, compared with the national average of 16.4 per cent. This includes prescribed and nonprescribed drugs, privately and publicly funded.

Spending on drugs is the second-largest piece of the health-care pie, after hospital spending.

Meantime, total drug spending in Canada reached an estimated $30 billion last year, $1.5 billion more than 2008, according to the study. This represents an annual increase of 5.1 per cent, the lowest hike in more than a decade.

The growth rate was at its highest between 1985 and 1986, when it jumped by 16.2 per cent. The average rate of increase since then has been 9.2 per cent.

“Spending on pharmaceuticals has consistently remained one of the major components of total health expenditure over the last two decades,” said Michael Hunt, director of pharmaceuticals and health workforce at CIHI.

< http://www.thestar.com/news/ontario/article/799360–drug-spending-slowing-report >

Tags: budget, Health, pharmaceutical

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