What will lowering generic drug prices do to Ontario’s healthcare system?

There has been a lot of talk lately about the fact that the Ontario government is going to force the lowering of the price of generic drugs. The government says this will lead to about $500m in savings. That is a pretty compelling number. But how does will it impact the pharmacies, the pharmaceutical manufacturers and ultimately the consumer, you and me?

Pharmacies are saying that lowering the drug price and eliminating professional allowances (the amount paid to a pharmacy by a drug manufacturer to stock their product) will have a huge impact on their profits. If these changes happen, they say, they will be forced to cut staff, cut services like home delivery and patient counseling, reduce the number of locations and cut hours. They also state that they will need to increase dispensing fees.

Some pharmaceutical companies are claiming that if the sole focus on the purchase of generic drugs is price (as opposed to quality, supply, results, etc.) then they will no longer be able to compete with the low-cost drug manufacturers.

Then we have the consumer, who through all this, should be paying less for the drugs that they need, but at what cost? Is it worth a lower price if the local pharmacy closes down and I need to walk another 10 minutes? What about if the pharmacy closes at 6pm and my kid gets sick or my grandmother needs medication in the middle of the night?

The key is to figure out a way to minimize the impact on all parties involved, minimize the risk and maximize the benefits. The government needs to find a way to significantly reduce any risk of this decision impacting services currently provided to the consumers. Cost savings should not come at the expense of inferior services. They also need to work with the pharmacies and pharmaceutical companies to minimize the impact on them.

We need to find ways to ensure that the pharmacies do not need to cut services like home delivery, patient counseling and 24-hour service. Do we need a 24-hour pharmacy on every corner? No. Do we need access to a 24-hour service in case someone gets sick in the middle of the night? Yes. So find the middle ground in what we have versus what we need.  We also need to anticipate the impact on hospitals. If 24-hour pharmacies close down, are more people going to visit hospitals in the middle of the night?

Pharmacies will need to figure out how to offer services at a lower cost. This could come from government subsidy or support.

Pharmaceutical manufacturers will have to find new ways of adding value to the pharmacies and the customer. Why can’t they perform the home delivery or provide resources for patient counseling?

The consumer may need to get used to a system not as convenient as the current one.

I am all for change, I just hope that we are not trading off quality of care and level of service for the almighty dollar in something as important as healthcare.


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