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Ensuring Better Access to Affordable Drugs

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THUNDER BAY, ON - May 14, 2010 - The generic drug rebate issue has been front and Michael Gravellecentre lately and I would like to take this opportunity to clarify a few things.  I strongly believe that our government is doing the right thing for Ontario consumers. Over the past week I have been in contact with a number of our smaller Northwestern Ontario community pharmacies and their operators, and I have been sharing their feedback with the Ministry of Health and Long-Term Care.  I can assure you that our government is sensitive to the needs of smaller pharmacy operations and we have a plan to assist rural and independent pharmacies.

Ontario plans to reform the prescription drug system to provide better access to lower-cost generic drugs for patients, while continuing to increase annual funding to the drug system as a whole and more fairly compensate pharmacists for the valuable work they do.

The fact is that Ontario pays too much for its prescription drugs.  Compared to the United States, we pay four times as much for some of the most popular generic drugs for diabetes, high blood pressure and other common health challenges.  The biggest reason we pay so much more is the payment of ‘professional allowances’ from generic companies to pharmacies.  These payments are supposed to be focused on patient care but based on the reports provided by pharmacies themselves, 70 per cent of these payments – which were worth at least three quarters of a billion dollars in 2009 – have been going to salaries, bonuses and fringe benefits.

Our government believes this system inflates the cost of drugs and is being abused by some pharmacies, and that the rebate money could be put to better use by listing more drugs.  This is why our government is investing in our drug system in ways that will better benefit the consumer.

As a result, we are introducing reforms that would see the costs of generic drugs drop by 50 per cent, clean up the abused system of professional allowances and increase direct compensation to pharmacists for dispensing fees and additional patient services, while also dedicating specialized financial support to rural and underserviced pharmacists.


In putting an end to ‘professional allowance’ rebates, we are proposing reforms that would move our provincial drug system to a transparent system that would see pharmacists get paid for the services they provide and that would offer extra financial help to rural and independent pharmacists, as well as pharmacists who service underserviced areas.

We are proposing to boost the amounts paid through dispensing fees by $124 million, and proposing to pay pharmacists $150 million – this includes $100 M in new funding – for the additional services that they often provide to patients.  Bill 179 has already proposed expanding the scope of services which pharmacists will now be able to provide to patients, and for which they will be paid.  These include prescribing under certain conditions, which would make a doctor visit unnecessary.

In rural and underserviced areas, we propose setting up a new $22 million fund to ensure financial support for rural pharmacists in order to maintain access for patients in rural and underserviced communities.  We also propose increasing the dispensing fee by up to $4 dollars for pharmacies in rural and underserviced areas, in order to see that people who live in these regions have a full-service pharmacy, close to home.

We believe that these efforts are necessary to streamline the pharmacy system and cut costs to benefit the consumer, while also keeping the needs of our independent pharmacies in mind.

Please be assured that, I am following this matter very closely.  I am quite concerned about the campaign launched by the larger pharmacy operators in the province, however – please note that the Ontario Federation of Labour is rejecting this aggressive lobbying effort by ‘Big Pharma.’

Certainly, I am not in favour of efforts by big business to alarm the public, and some of the rhetoric employed in this campaign is misleading and unfair. I encourage you to visit a new website at ontario.ca/fairdrugprices which explains the facts, benefits, and what people are saying about lowering the cost of generic drugs for all Ontarians.

As your MPP, please know that I am aware of your concerns, as is Health Minister Deb Matthews, our government, and the Premier.  It is my belief that these changes to the pharmacy system will benefit the consumer and that the needs of smaller pharmacy operation can also be accommodated in such a way that reductions in service will not necessary.

By Michael Gravelle, MPP Thunder Bay-Superior North

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