The Fraser Institute

The Fraser Institute

April 04, 2012 06:32 ET

The Fraser Institute: Sluggish Government Approvals Create Two-and-a-Half Year Wait for Canadians to Access New Medicines

TORONTO, ONTARIO--(Marketwire - April 4, 2012) - Canadians are waiting nearly two-and-a-half years for government bureaucracies to approve new prescription drugs for public use, finds a new report from the Fraser Institute, Canada's leading public policy think-tank.

The study, Access Delayed, Access Denied 2012: Waiting for New Medicines in Canada, points out that in 2010, Health Canada took 527 days on average to certify new drugs as safe and effective, while the provinces added another 358 days to approve new drugs for coverage under public drug plans.

"That's more than 17 months for Health Canada to approve a new medicine for public use, then the provinces take up to another year to make a decision about coverage," said Mark Rovere, Fraser Institute associate director of health policy research and co-author of the report.

"This bureaucratic layering creates unnecessary delays and deprives many Canadians access to new medicines."

There are two stages to Canada's drug approval process: Initially, Health Canada must certify a drug as safe and effective, then the provinces must decide whether or not it will be eligible for reimbursement under provincial public drug programs.

According to the report, only 22 (or 62.9 per cent) of the 35 new pharmaceutical drugs certified by Health Canada in 2006 were covered by provincial drug plans as of January 1, 2012, compared to 31 (or 88.6 per cent) which had been covered by at least one private insurer.

The nearly two-and-a-half year wait in 2010 is still a significant improvement over the waits recorded in 2004, when Health Canada took on average 839 days and the provinces 648 days to approve new prescription drugs-a total of 1,487 days or more than four years.

The study also shows that Health Canada takes longer to certify new drugs than its international counterparts. From 2006 to 2010, Health Canada's performance was worse than that of the EMA, Health Canada's European equivalent; similarly, Health Canada's performance was worse than that of the American FDA in six of the last seven years studied (2004 to 2010).

In Access Delayed, Access Denied, the authors suggest two specific policy changes to improve the drug approval process in Canada and speed up access to new medicines.

Regulatory cooperation with other countries

First, Canada should take advantage of the regulatory knowledge and capacity of other jurisdictions, rather than attempting to duplicate the drug approval process.

International safety standards are similar, so the federal government could speed up access to new drugs by harmonizing with European and American regulatory processes through mutual recognition of drug-approval decisions.

Replace government drug programs with means-tested subsidized access to private insurance

Second, Private drug insurers in Canada tend to cover a wider range of new medicines and approve their coverage at a much faster rate than public drug programs. Provincial governments could improve access for patients and save money by replacing existing public drug programs with a means-tested subsidy for people with low incomes, used to purchase a drug insurance plan of their choice in a competitive private market.

"This policy would allow low-income patients to choose the drug plan that's best for them, thus reducing government-imposed restrictions on consumer choice," Rovere said.

"Allowing the private insurance market to compete through price and service is the best policy choice for improving access to new medicines while also cutting costs for patients and taxpayers."

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The Fraser Institute is an independent research and educational organization with locations across North America and partnerships in more than 80 countries. Its mission is to measure, study, and communicate the impact of competitive markets and government intervention on the welfare of individuals. To protect the Institute's independence, it does not accept grants from governments or contracts for research. Visit

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