New Independent Study explodes myths about the impact of brand name medicines on health costs
Ottawa, October 4th, 2010 - A new study released today by the Fraser Institute exposes the myths about pricing of brand name medicines and their impact on overall health spending in Canada.
The study called "The Misguided War against Medicines 2010" finds that patented prescription medicines accounted for only 5.5 per cent of total government health spending in 2009 which is a reduction from 6.3 per cent in 2006.
"This study offers important information for policy makers because it shows that the value of new medicines and vaccines far outweighs their cost to the health care system." said Russell Williams, President of Canada's Research-Based Pharmaceutical Companies (Rx&D). "Rather than short term cost containment, we could be looking at ways to work together to improve patient health and well-being and ensure the sustainability of our health care system."
The study's authors make the following findings:
*After adjusting for inflation, prices for existing patented medicines have decreased in real terms in 19 of the last 22 years and have declined in nine of those years.
* Introductory prices for patented medicines in Canada are lower than those in many of the countries the Federal Government uses for international comparison and are "far below American prices for identical drugs."
* New medicines are now offering viable treatments and hope for patients for whom no viable treatment option existed in the past.
* Hospitalization rates between 1995 and 2007 declined as spending on drugs increased as a percentage of health budgets. This illustrates that investment in new medicines reduces costs elsewhere in the health care system.
New medicines and vaccines have helped significantly reduced mortality and hospitalization rates for a number of diseases such as cancer, cardiovascular disease and heart attacks, diabetes, HIV/AIDS and child leukemia. That is why it is important to invest in research to discover new treatments that offer new hope for patients.
"The Study demonstrates that Canadians receive excellent value from innovative pharmaceuticals. Improving access to the latest medicines would positively contribute to ensuring a sustainable health care system," added Mr. Williams. "Appropriately prescribed new medicines are part of the solution to the challenge of sustaining Canada's health care system."