Montreal

Quebec taxpayers will save more than $1B thanks to generic drug deal, says health minister

The Quebec government and generic drug suppliers have reached an agreement that will save taxpayers more than a billion dollars while avoiding the tendering process, according to Gaétan Barrette.

The deal, reached Friday, will allow for more than $1.5B in savings over 5 years, says Gaétan Barrette

Health Minister Gaétan Barrette says a deal between the government and generic drug suppliers will save Quebec taxpayers more than $1 billion in the next five years. (Jacques Boissinot/Canadian Press)

The Quebec government and generic drug suppliers have reached an agreement that will save taxpayers hundreds of millions of dollars while avoiding the tendering process, according to the health minister.

Gaétan Barrette made the announcement during a news conference Sunday morning. The deal will take effect Oct. 1.

Barrette says Quebec spends about $800 million annually on generic drugs, and that this new agreement will mean a decrease of more $300 million a year, which works out to a roughly 40 per cent reduction.

In a statement, Jim Keon, president of the Canadian Generic Pharmaceutical Association (CGPA), said he believes the agreement is "a much better path forward for taxpayers, patients, healthcare providers and the generic pharmaceutical industry than a risky tendering system."

Last month, with the looming possibility of a tendering process being introduced, drug companies came to the government with a proposition to lower drug prices by $1.5 billion over five years.

Barrette said the deal, reached two days ago, will allow for more savings, but did not say how much more.

Tendering process used as leverage, Barrette says

Last June, the provincial government adopted legislation giving it the oversight to drop generic drug prices, including the possibility of introducing a tendering process.

Last month, the government and pharmaceutical industry players were trying to negotiate an agreement to bring down the price of generic medications but Barrette said the companies pulled out of "within a hair" of signing. Keon has said the association never walked away from the negotiations.
Barrette says the deal will take effect this fall.

When talks broke down, that's when the government announced it would launch its first tendering process July 1. Barrette said the day before it was to begin, he got a call from the association saying it wanted to return to the negotiating table.

Barrette said the possibility of a tendering process was a form of leverage on the generic drug manufacturers.

Details on how the agreement will be implemented are expected to be finalized in the coming weeks.

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