Provincial Generic Drug Pricing Summary by Province and Effective Dates

In 2010, several provinces introduced generic drug reforms to reduce the cost of generic drugs covered by both provincial prescription drug programs and private plans.  These provinces are implementing these reforms in a phased manner that may include effective dates in 2010, 2012 and 2013.  The information below will provide you with a summary of these changes by Province and effective dates.

Alberta (Background):  In April 2010, Alberta enacted legislation to reduce the amount paid for generic drugs listed on the Provincial formulary from 75 percent to 56 percent of the cost of the brand drug with new generics added to the Provincial formulary regulated at 45 percent of the brand drug.  The province also implemented a Transitional Allowance of $3.00 that was applied to all prescriptions under $75.00.  (Transitional allowances compensate pharmacies for lost revenue resulting from the introduction of lower cost generic drugs.)

Important Dates:

Effective April 1, 2011 the allowance was reduced from $3.00 to $2.00 per prescription.  This Allowance will be phased out over the next three years.  (On April 1, 2012 the allowance will be reduced from $2.00 to $1.00 per prescription and will be eliminated on April 1, 2013.)

British Columbia (Background):  Effective October 15, 2010, B.C. Pharmacare reached a deal with the Provincial Pharmacy Association resulting in the reduction to the allowable cost for existing generic drugs on the provincial formulary to 50 percent of the cost of the brand drug and 42 percent of brand drug for generics added to the Pharmacare program after January 1, 2009.

Important Dates:

Effective July 4, 2011 prices for generic drugs (existing and new) will be further reduced to 40 percent of the cost of the brand drug.  Generic prices will be further reduced to 35 percent of the cost of the brand drug on April 2, 2012.

Provincial Generic Drug Pricing (Ontario, Nova Scotia and Quebec)

Nova Scotia (Background):  In the fall of 2010, Nova Scotia announced plans to implement generic drug reforms and extended an invitation to stakeholders to participate in discussions.

What is happening now

On Monday April 11, 2011 the province of Nova Scotia announced new legislation which will allow residents of Nova Scotia covered by Pharmacare to pay lower prices for most generic drugs.

Important Dates:

Effective July 1, 2011 a 45 percent cap will be set on the price of generic drugs, based on the price of the brand drug under Pharmacare.  Further caps will be phased in over one year.  (Effective January 1, 2012, the cap will move to 40 percent and on July 1, 2012 the cap will reduce to 35 percent.)

Ontario (Background):  In July 2010, the province enacted legislation to reduce the amount paid by both the public and private sector for generic drugs listed on the province formulary.  For the Ontario Drug Benefit (ODB) Program, the generic prices were reduced from 50 percent of the cost of the brand drug to 25 percent of the brand drug.  For private plans, the generic prices, previously unregulated, were regulated to 50 percent of the cost of the brand drug.

Important Dates:

Effective April 1, 2011 generic prices for private plans were reduced from 50 percent of the cost of the brand drug to 35 percent.  Generic pricing for private plans will be further reduced from 35 percent of the cost of the brand drug to 25 percent of the cost of the brand drug on April 1, 2012.

Quebec (Background):  In November 2010, Quebec announced that the Province would reduce the allowable amount for generic drugs on the provincial formulary to 25 percent of the cost of the brand drug.  At that time, generics were reduced from 54 percent to 37.5 percent of the cost of the brand drug.

Important Dates:

Effective in April 2011 prices for generics were reduced to 30 percent of the cost of the brand drug.  Prices for generics will be reduced to 35 percent of the cost of the brand drug effective in April 2012.

Recently Announced Regulatory Changes Regarding Eye Care (Ontario and Alberta)

Ontario approves regulation that allows optometrists to prescribe medications for eye-related conditions:

On April 6, 2011 the Ontario government approved regulation allowing optometrists in Ontario to prescribe medications for their patients.  The change is designed to alleviate wait times on emergency rooms and clinics for patients with eye-related problems.  Optometrists in Ontario will now be able to prescribe medication to treat eye diseases/conditions including: bacterial and viral eye infections; red eye due to contact lens wear; eyelid infection and inflammation; inflammation of the eye; eye pain; allergies affecting the eyes; superficial foreign bodies; and glaucoma.

Alberta will extend coverage for medically necessary eye care to all Albertans – regardless of age:

On March 31, 2011 Alberta Health and Wellness reached a new three year agreement with the Alberta Association of Optometrists to provide publically funded services. Under this new agreement, starting October 1, 2011, all Albertans, regardless of their age, who require an optometrist for certain medically required, eye related services, will now be covered under their provincial plan.

The Leslie Group will monitor the impact if any these changes will have on our clients’ group insurance programs.

Should you have any questions or concerns, please do not hesitate to contact us at 416-510-8966.

The Leslie Group Limited