Generic drug deal to save Quebec $1.5B

MONTREAL — The Quebec government says it will save more than $300 million a year on generic drugs after reaching a deal with the association representing Canada’s generic pharmaceutical companies.

Health Minister Gaetan Barrette believes the five-year agreement in principle will save the province $1.5 billion, which will be redistributed in the health-care system.

The Canadian Generic Pharmaceutical Association said the deal includes further price discounts and the launch of new costsaving generic prescription medicine.

Quebec already spends about $800 million a year on generic drugs and Barrette wanted to reduce those costs.

Last week, the province and association resumed negotiations, with a deal announced Sunday.

It is expected to come into effect this October.

“What will happen is a reduction in price on both the public sector and the private sector,” Barrette said. “Quebecers will see on their bill, the price of generic drugs will go down as of this fall.”

In late June, in the midst of thorny negotiations, Quebec had said it was prepared to go to tendering in order to get cheaper generic prescription drugs.

The association said in a statement that a key clause in the deal is that Quebec won’t put out tenders for the drugs.

“This negotiated agreement is a much better path forward for taxpayers, patients, health-care providers and the generic pharmaceutical industry than a risky tendering system,” said association president Jim Keon.

Keon had previously said such tendering could threaten jobs as well as the supply of cost-saving generic pharmaceutical products.

Quebec’s generic pharmaceutical industry supports 4,100 direct jobs and creates a direct economic impact of $769 million, according to the association.

“Is this the lowest price we could have ended up with?” Barrette said. “Maybe not. But the price to pay for this lower price could have been a loss of jobs.”

The agreement will be reviewed in five years, he added.

Quebec’s Order of Pharmacists also said it was pleased with the outcome.

“We hope that this agreement will generate savings as forecast, but will also provide the Quebec population with access to drugs without fear of supply disruptions,” the order said in an email.

The federation that represents chambers of commerce in Quebec also lauded the deal, saying it includes savings for the health system, maintains market conditions and ensures continued investment in the sector.