Drug spending growth slows to 16-year low

The expiration of some drug patents and the arrival of new generic products helped slow growth in drug spending in Canada in 2012 to the lowest rate in 16 years, according to a new report

TheCanadian Institute for Health Information said Thursday that the annual growth rate for drug spendingcontinued to rise last year but at a slower growth rate of 3.3 per cent.

The group estimated that total drug expenditures reached $33 billion or $947 per person, in 2012.

Last year'sexpected growth rate in the public sector (1.9 per cent) was the lowest since 1996, while the expected rate in the private sector (4.1 per cent) was the lowest since 1994.

"This trend is due in part to patent expirations of blockbuster brand name drugs and the subsequent entry of lower-priced generic drugs used to treat common ailments like high cholesterol and hypertension, as well as the implementation of generic pricing policies by provincial drug programs," the report's authors said.

Manypublic drug programs have also cuthow muchthey'rewilling to pay for generic drugs, with prices now regulated to be, at most, 25 per centto 40 per centof the price of brand name products, the institute said.

Total drug expenditure per capita is forecast to have ranged from $736 in British Columbia and $873 in Alberta to $1,110 in New Brunswick and $1,160 in Nova Scotia.

Drugs continued to eat upthe second-largest share of all health spending, behindhospitals and ahead ofdoctors, two categories that are growing faster than drug spending.