Canada: Federal Pharmacare Bill Proposes Universal Drug Coverage
Life Sciences Bulletin

The federal Parliament tabled Bill C-64, An Act respecting pharmacare (the "Bill"), on February 29, 2024. The Bill outlines the first phase of the federal government's commitment to national universal pharmacare by providing universal, single payer coverage for certain drugs through collaborative agreements with willing provinces and territories. To this end, the Bill proposes to provide universal single-payer, first-dollar coverage for two categories of medicines: contraceptives and diabetes treatments:

The lists of diabetes medications and contraceptives to be discussed with provinces and territories for specific coverage were also published by the government. Notably, it appears that any future expansion of the national pharmacare program beyond these products will require an amendment to the Act, since the Bill includes no authority for the government to make regulations.

According to the text of the Bill and the information provided in the government's technical briefing, the government recognizes the role of the provinces, territories, and Indigenous peoples in the provision of healthcare. The government intends to respect their jurisdiction and cooperate with them to support efforts to improve the accessibility and affordability of prescription drugs and related products.

Based on the information provided in the technical briefing, the national pharmacare program is meant to enhance rather than replace existing provincial drug benefit programs. This raises questions about how the national pharmacare program will interact with coverage arrangements in various provinces, under both public and private plans. For example:

• British Columbia: British Columbia already offers universal contraceptive coverage; will the province be eligible to enter into an agreement for funding under the national program?
• Quebec: How will the national program interact with Quebec's existing universal two-payer system, and how might this impact Quebec's allocation of funds under the national program?
• Private Plans: If an individual is already eligible for coverage through an employee benefit plan or private insurance, would a participating province be required to cover the individual if the province wants to receive federal funding under the national program? Will individuals with private coverage be forced to switch from a drug covered under a private plan to a drug covered under the national program?
• Drug Pricing: How will the national program impact existing pricing arrangements between drug manufacturers and payers?

The Bill permits the Minister of Health to seek the advice of the recently created Canadian Drug Agency on a number of topics, including the prescription drugs and related products that should be included in drug coverage plans in Canada, as well as the conditions of such coverage. The Bill also imposes several obligations on the Minister after coming into force:

• Within one year, request that the Canadian Drug Agency prepare a list of essential prescription drugs and related products to inform the development of a national formulary;
• Initiate discussions on the above-noted list with provinces, territories, Indigenous peoples, and other partners and stakeholders with the aim of continuing to work toward the implementation of national universal pharmacare;
• Within one year, request that the Canadian Drug Agency develop, in collaboration with partners and stakeholders, a national bulk purchasing strategy for prescription drugs and related products;
• Within one year, publish a pan-Canadian strategy regarding the appropriate use of prescription drugs and related products; and
• Within 30 days, establish a committee of experts to make recommendations respecting options for the operation and financing of national, universal, single-payer pharmacare.

The Bill's impact remains unclear in a number of respects:

• Whether drug manufacturers will be required to participate in negotiations for bulk purchasing or if a national bulk purchaser will become a new participant in the pan-Canadian Pharmaceutical Alliance.
• Whether the national pharmacare program will be tied to the government's rare disease strategy, which is referenced in the Bill.
• Whether the national pharmacare program will favour coverage for specific types of drugs (e.g. generic drugs).

Whether and when the Bill may come into force remain to be seen, not least because a federal election is expected by October 2025. Even if the Bill comes into force, implementation will depend on cooperation and acceptance by the provinces and territories, the prospect of which seems challenging in light of Alberta's announcement that it intends to opt out of the national program and the reservations expressed by other provinces, including Ontario and Saskatchewan.

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