Overall prescription medication costs for Canada’s public drug plans rose by 9.9 per cent in 2015-16, according to a new report by the Patented Medicine Prices Review Board.
The plans collectively spent $11.3 billion on prescription drugs, $1 billion more than was spent the previous year. In comparison, drug costs in 2014-15 grew just 3.7 per cent. The 2015-16 growth was primarily driven by a 12 per cent increase in drug costs such as new treatments for hepatitis C, according to the report.
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The report also notes that drugs exceeding $10,000 in annual treatment costs grew by 60.5 per cent. These drugs, which accounted for more than a quarter (27.6 per cent) of drug costs, were used by less than one per cent of the public plans’ nine million beneficiaries.
At the same time, the effects of generic substitution and price reductions dropped to -4.1 per cent in 2015-16, compared to -6.2 per cent the previous year.
Drug costs made up 74.7 per cent of public plans’ total costs followed by dispensing fees (21.8 per cent) and markups (3.5 per cent). The plans covered 79.7 per cent of beneficiaries’ drug costs while the rest was either paid out of pocket or by private insurers.