Pharmacists right to be upset

The government backed up Wednesday — again — but pharmacists are still in revolt against a textbook case of bad policy, delivered in haste for all the wrong reasons.

The policy, of course, is the sudden government decision to reduce the price of all 4,000 generic drugs from 35 per cent to 18 per cent of brand-name equivalents.

Alberta is the only province to do this. All the others, by national agreement, dropped the price to 18 per cent for only six of the most commonly prescribed drugs.

That makes sense. The six-drug drop was a smaller project that was expected and understood by pharmacists.

Being so commonly used, these drugs have a range of suppliers, making shortages unlikely.

But our government decided to go for the whole bundle.

And the reason, one suspects, was mainly the money.

The saving from the price drop for 4,000 drugs was projected at $90 million — a lot of dough for a province facing a huge revenue shortfall.

But now, just over a month later, the Progressive Conservative government has already given back $40 million to help repair the damage to pharmacies across the province; proof that bad policy makes for even worse economics.

By all accounts, the de-

Nothing like this is happening anywhere else in Canada. But it’s happening here because of clueless bureaucratic overreach

cision to include all the generics was a shock to Alberta pharmacists.

“I’ve been in meetings since last fall and we talked about the six generics,” says Byron Bergh, president of the Alberta Pharmacists Association.

“But the decision to drop the price to 18 per cent for all generics came as a total surprise to us.”

The economics of prescription drugs are fiendishly complex in Canada, largely because the provinces set pricing. When prices suddenly change for 4,000 drugs, instead of just six, there will be ugly, unintended consequences.

On Wednesday I asked a pharmacist to price a 100-pill prescription for Toradol, a commonly prescribed non-steroidal drug for pain and inflammation.

Before the price drop, the cost was $52.78 for the generic Toradol.

With the price drop, it would have gone down to about $24.63.

But all that’s irrelevant, because there no longer is a generic Toradol.

One supplier stopped making it in January. The other bailed out of Alberta after the price drop.

That leaves one choice: the brand-name version of Toradol.

And it costs $93.68 for 100 pills. In this case and some others, a decision that was supposed to save money for consumers will actually cost much more.

Wildrose has pushed the government hard on this issue in the legislature, and been accused in return of fearmongering and opposing lower drug prices.

But the PCs haven’t refuted key Wildrose charges; that the new regime will lead to shortages in some cases and higher costs in others; and that two retreats in less than a month prove the PCs know they got it badly wrong.

The pharmacists care about pricing, obviously, but they’re also vitally interested in their own survival.

As Calgary pharmacist Debbie Boyle says, “I’m all for lower prices, but we have to have a model that supports the business.”

Monday’s backup by Health Minister Fred Horne, which included reinstating a $1 extra payment per prescriptions by government, doesn’t nearly make up for lost revenue.

Many pharmacists are expected to march in their white coats today. They will close their offices for two hours and explain their dilemma to customers on the sidewalks outside.

Nothing like this is happening anywhere else in Canada. But it’s happening here because of clueless bureaucratic overreach.

The only sensible solution is to reinstate the old price regime for all but the six most common drugs. Then, plan the overall drop in a sensible way.