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[e-drug] RFI: Country Attitudes Toward Generic Substitution (6)

E-DRUG: RFI: Country Attitudes Toward Generic Substitution (6)

Dear Lenny:

Generic substitution in Canada is a complicated matter because of the
federal nature of our country.

Generic companies submit their products for approval to an arm of Health
Canada called the Therapeutic Products Directorate once the patent has
expired. In order to get approval all the company has to do is to prove
bioequivalence to the brand-name product using criteria set out by the

The TPD then either approves or does not approve the generic product
depending on the results of the bioequivalency trials.

Once the drug has been approved the generic companies then need to get the
drug added onto the formularies in each of the provinces in which they
hope to sell the drug. (There are 10 provinces in Canada.) This step is
necessary because it is the provincial governments, not the federal
government, that
pays for prescription drugs that are provided through public plans. Each
province has somewhat different rules regarding pricing for generic drugs.
In Ontario where I live the first generic added to the formulary has to be
priced at no more than 70% of the brand-name product and each subsequent
generic cannot be more than 90% of the price of the first generic.

If the drug is covered under the public drug plan it does not matter whether
the doctor writes the prescription using the generic or brand name. The
decision as to which version of the product to dispense is up to the
pharmacist. Provinces have different rules regarding dispensing but nearly
all provinces will only pay the pharmacist the price of the lowest cost
generic product listed on the formulary so it doesn't matter which product
the pharmacist actually dispenses. The only way to compel the pharmacist to
dispense a brand name drug is if the doctor writes in hand-writing "do not
substitute" or something equivalent on the prescription. This only happens
about 1/200 cases.

If the prescription is being paid for by private insurance or out-of-pocket
different provinces have different rules about whether or not the pharmacist
has to dispense a generic product.

Generic substitution is very well accepted here in Canada by doctors and

If you want any further information about generic substitution I would
suggest that you contact the Canadian Generic Pharmaceutical
Association. The web site is http://www.cdma-acfpp.org/

Please let me know if any of this is unclear.

Joel Lexchin MD
Associate Professor
School of Health Policy & Management
Atkinson Faculty of Liberal and Professional Studies
York University
4700 Keele St.
Toronto, Ontario
Canada M3J 1P3
Phone:  416-736-2100 x 22119
Fax:  416-736-5227
e mail:  jlexchin@yorku.ca

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