Federal health minister Marjorie Michel met with senior pharmaceutical executives in Montreal on Thursday to respond to American pressure to raise international drug prices.Justin Tang/The Canadian Press
Canada’s patented drug industry has established a task force with the federal government to prepare for coming trade talks with the United States and Mexico and respond to American pressure to raise international drug prices, including in Canada.
More than two dozen senior leaders in the pharmaceutical industry gathered in Montreal on Thursday morning to meet with Health Minister Marjorie Michel and other public representatives.
The group is planning to meet every two weeks and prepare a report in 90 days with options for Canada’s response, from changing how public insurance plans evaluate drug prices to how to boost domestic research and development.
“As a country, we need to address our own sovereignty,” Ms. Michel said in an interview. “How we can provide equitable access to treatment for Canadians, medicines, vaccines, everything. This is a conversation as a country that we should have done, but with the geopolitical context, we cannot wait.”
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Co-chairs Martin LeBlanc, a former pharmaceutical executive, and Michelle Boudreau, a former public servant, said the mood among task force members was positive and urgent at the first meeting, though they were not allowed to provide specifics of what was discussed.
Mr. LeBlanc compared the debate around Canada’s drug spending to international defence obligations. He said it “would be very beneficial to the Canadian economy, but also to patients, if you can restore an equilibrium where Canada is seen much like in the defence industry as spending its appropriate pro rata GDP share of drug innovation.”
Ms. Boudreau said the task force’s focus is on providing actionable recommendations for the government.
Countries in the United States-Mexico-Canada Agreement are expected to begin a review of the deal by July 1.
The task force meeting happened the same day that U.S. President Donald Trump announced the completion of a year-long Section 232 national-security investigation of the pharmaceutical industry and the imposition of new tariffs.
Patented pharmaceuticals will face 100-per-cent tariffs in 120 days (for large companies) or 180 days (for small ones). There are many exceptions, including for generic drugs, some countries with trade deals and products from companies that have signed most-favoured-nation agreements.
The pharmaceutical industry has been a particular focus for Mr. Trump, who has pushed drug companies to lower their prices in the U.S. and raise them in other countries. Americans typically pay three times more for drugs than residents of other countries, and the U.S. as a whole represents about half of all global drug spending.
Kirsten Axelsen, a senior policy adviser at DLA Piper and former Pfizer executive, said Canada is not the focus of the Trump administration’s pharmaceutical agenda, but the country still must be prepared or else companies could delay launching products in the Canadian market.
“It’s essential for countries outside of the U.S. to be thinking about how they’re going to maintain access to medicines if that’s a priority for their health system, especially a smaller market like Canada,” Ms. Axelsen said.
The tariffs are not expected to have a huge direct impact on Canada’s industry, at least in the short term. Canada exports about US$3-billion worth of finished medication annually to the U.S., according to research published in the Journal of the American Medical Association last year, but 79 per cent of that was generic, which would be exempt from the tariffs.
“The vast majority of our exports into the United States are generics, so from a large impact standpoint, it’s not as massive as it would be,” said Mina Tadrous, an associate professor at the University of Toronto who co-authored the research.
However, he cautioned there could be ripple effects over time depending on how companies respond to the tariffs.
Generic Ozempic makes debut in India – ahead of Canada, where it became legal months ago
Meanwhile, Novo Nordisk, the Danish maker of the blockbuster drug Ozempic, sent several recommendations regarding trade issues to the House of Commons health committee this week. It suggested Canada could respond to most-favoured-nation pressure by no longer publishing certain drug pricing recommendations from Canada’s Drug Agency, a government-funded non-profit that evaluates new drugs on factors such as value for money.
Novo Nordisk also recommended Canada increase intellectual-property protections under USMCA. It suggested the eight years of data protection for biological drugs be extended to 10 years. Ozempic’s data protection ran out on Jan. 4, making generic versions legal in Canada, and several companies are now waiting for Health Canada approval for their versions.
A list of participants for Thursday’s task force meeting, provided by the government, listed senior executives from 25 companies and organizations, including leaders from AbbVie, Amgen, Aramis, Aspect Biosystems, AstraZeneca, BioCanRx, BIOTECanada, Bristol Myers Squibb, CSL Seqirus, Gilead, GSK, Johnson & Johnson, Moderna, Merck, Novartis, Novo Nordisk, Pfizer, Roche and Sanofi.