NAFTA talks threaten Canada’s universal pharmacare
A “modernized NAFTA” has significant implications for many sectors of the economy — and health care is one of them. What’s at stake? Canadians’ right to universal access to affordable medicines.
When negotiating with the U.S. and Mexico, Canadian trade and health officials would be well advised to be mindful of two things.
First, U.S. trade negotiators have long favoured the interests of pharmaceutical manufacturers. The U.S. trade agenda is heavily influenced by pharmaceutical industry advisors and lobbyists with little or no input from opposing industries, health professionals or the public.
Canada has come up short in past trade negotiations where prescription medicines are concerned.
In the 1980s, the U.S. pharmaceutical industry successfully lobbied the U.S. government to make the elimination of early generic drug competition in Canada part of the Canada-U.S. free trade agreement. In the 1990s, it made the dismantling of policies favouring Canadian drug manufacturers part of the original NAFTA deal.
In re-negotiating NAFTA, experts expect the U.S. to press Canada for longer monopolies on patented medicines. This is intended to delay competition from low-cost generic medicines and would significantly increase costs for Canadians -- without any benefits.
But changes in intellectual property rights for medicines may not be as bad for Canada as other objectives the U.S. will likely pursue on behalf of the pharmaceutical industry in NAFTA re-negotiations. International experience suggests the U.S. will also attempt to constrain the pharmaceutical pricing and coverage policies of its trading partners.
Australia’s experience is noteworthy. In 2003, the U.S. entered Australia-U.S. Free Trade Agreement (AUSFTA) negotiations with an explicit mandate to seek “the elimination of government measures such as price controls and reference pricing which deny full market access for United States products.”
The pharmaceutical industry typically views such cost-effectiveness considerations as “nontariff barriers” to markets.
The Australian government successfully defended its universal public drug plan and its right to use rigorous, evidence-based processes to determine which medicines would be covered and which would not.
Canadian negotiators should also be mindful of the job of Canadian health and trade officials to defend not only the existing public health care system, they must also recognize and protect Canada’s aspirations toward a better system in the future.
Canada is the only high-income country with a universal health care program that doesn’t include universal coverage of prescription drugs. Today, more than 60 years after such a plan was originally proposed for Canada, our provinces are finally demanding it from the federal government.
If Canada is to have universal pharmacare anytime in its future, NAFTA re-negotiations must prioritize the protection of evidence-based coverage decision-making and price negotiations that will be essential to create a system that functions effectively and sustainably.
Canadian negotiators must be ready to deflect the tired rhetoric of U.S. trade negotiators and the pharmaceutical industry lobby, who will likely claim that eliminating value assessments and price negotiations will somehow magically “improve access.”
In reality, the only way to ensure that all Canadians have affordable access to genuine pharmaceutical innovations is to assess each drug according to criteria that are rigorous but fair to every manufacturer.
It is almost certain that the U.S. will pursue provisions in a re-negotiated NAFTA that will undermine both current and future efforts to provide universal coverage of medicines on the basis of rigorous assessments of comparative clinical- and costeffectiveness. Canada must be prepared to fight this.
Remember that, in its efforts to repeal Obamacare, the current U.S. administration is willing to drive up health care costs while allowing tens of millions of Americans to lose their health insurance. If it’s willing to do that to its own citizens, this U.S. Government will likely also attempt to coerce Canada to do the same to Canadians by way of NAFTA provisions that would prevent the implementation of an equitable and sustainable universal pharmacare system.