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It is time for real leadership from the Premiers to protect, strengthen, and expand our public health care

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CETA Is A Poison Pill For The Health Of Canadians

The secretive Comprehensive Economic Trade Agreement (CETA) with the European Union (EU) has generated substantial discussion as it enters its final stage.  One point that seems to have slipped under the radar is the significant detrimental affects this Trojan Horse of a deal could have on our public health care system. As Maude Barlow asked, if you are “Wondering why Canada would be talking about pharmaceutical policy at all in what is supposed to be a trade deal? You are not alone.” The leaked text is particularly frightening as it shows the Harper government caved into the EU’s most dangerous demands with regard to pharmaceutical policy. This is all a part of a callous strategic plan by the Harper Government to under fund public healthcare system ($36 billion has already been cut as our government refuses to sign a fair and equitable Health Accord), and cost our public healthcare systems billions of dollars in new drugs costs, jeopardizing feasibility and blocking the growing movement to implement Universal Pharmacare for the benefit of all Canadians. More than ever, it is critical Canada's Premiers, and all Canadians, say no to CETA and demand Universal Pharmacare now!


What Will CETA Cost Canadians And Our Public Healthcare?

It is estimated that changes to patent protection for pharmaceutical drugs could end up costing our public health care system anywhere between $850 million to $1.65 billion annually.  This is up to 13% of the total drug costs Canadians pay annually.  On the other hand, Canadian exporters predicted to gain only about $226 million from the elimination of industrial tariffs. It doesn’t take an accountant to figure out this is an appalling deal for Canadians and it is little wonder Harper wanted to keep it secret.


Canadians And The Burden Of Rising Drug Costs

At approximately $900 per person, on a per capita basis, Canada has one of the worst performing pharmaceutical sectors in the world and our drug costs are already the 2nd  highest globally (after the United States). At the same time Canada also has one of the fastest rising drug costs per capita among OECD countries, while being the only country in the world with a public Medicare system that excludes prescription drugs. CETA will only exacerbate this situation and diminish health outcomes. Since 1998, overall drug spending has totaled more than what is spent on physicians in Canada, and for much of the last two decades drug spending has consistently grown faster than overall health spending. With drug costs growing under CETA, Canadians will likely see a restriction in medicines the provinces can offer and money being taken out of other important areas of our health care system, diminishing the quality and viability of our Medicare.  This will often mean the burden of cost passed onto the elderly and sick in many cases (those least likely to be able to afford it). Currently, 1 in 10 Canadians are unable to fill their prescriptions leading to inhumane health outcomes down the road. Further, between 1997 and 2009, out of pocket expenditures for prescription drugs for the richest 20% in Canada have increased by 21%, while they increased by 64% for the poorest 20%.While brand name pharmaceutical companies are supposed to invest 10% of their sales into R&D, in the last 10 years they have failed to meet their end of the deal (in 2012 the R&D-to-sales ratio fell to 6.6 percent). CETA will raise the patented drug cost by around 13% and is expected that the R&D-to-sales ratio will decline even more, since CETA will artificially inflate sales due to higher costs without increasing R&D expenditures. Paying higher prices for drugs does not result in a thriving pharmaceutical sector, in fact brand-name pharmaceutical sector went from 22,332 employees in 2003 to 14,990 in 2012.  This is a rotten deal for everyone but the companies and their shareholders.


Patent Law Changes In Favour Brand Name

Pharmaceutical Companies

The CETA agreement commits Canada to creating a new system of ‘patent term restoration’ which will end up significantly delaying the entry of generic medicines onto the market by two years. Brand name pharmaceutical companies will make hundreds of millions of dollars extra with this extension and add additional costs for Canadians who need these drugs.  CETA also locks Canada into terms of ‘data protection/exclusivity’, which makes it incredibly difficult for future Canadian governments to change limits on the length of time a drug has exclusivity to the market place. Studies predict that with CETA this could this could mean that, the percentage of drugs having extended market exclusivity jumps from 24% to at least 45%, and likely higher. This will also delay the time in the future which it takes generic drug companies to even begin to challenge weak patents. CETA will also allow a new right of appeal under the 'patent linkage system' and further delay cheaper generic drugs for Canadians and our public health care system.  As for the Europeans they don’t have to make any substantial changes to their rights and legislation, only Canada is being affected in this way by this deal.


Investor State Dispute Settlement and Public Health Policy

There is no legitimate reason why health impact assessments  and policy frameworks are being made by trade departments who lack the understanding of health policy needs and requirements. The Harper government not to include a 'carve out' in CETA for public health by excluding or even limiting it from the much maligned Investor State Dispute Settlement (ISDS) mechanism. ISDS is a kangaroo court which elevates foreign companies to the level of sovereign governments (while allowing them to side step domestic laws) to sue national governments if they feel their profitability is undermined by a governments public interest policies.  CETA is a part of a new aggressive wave of trade deals being pushed which lay waste to the right of Canadian governments the right to legislate public health policy for its citizens in favour of ‘corporate rights’. US and EU investors are most active users of the ISDS mechanism and together they account for 75% of the global number of known ISDS claims.  This is what the Harper government has opened our public health system up to with no regard for the on the ground effects it will have on ordinary Canadians. We all know the Harper government is engineering the environment for a two-tiered health system, but with the provisions in CETA reversing privatization (even failed privatization) becomes much more costly and difficult, if possible at all.


Pharmacare Under Attack In CETA

CETA will undoubtedly be a boon to these private drug insurance plans at the expense of Canadians getting equitable and humane access to important medications. These ISDS lawsuits serve to ‘chill’ the willingness of provincial and federal governments to make regulatory decision and measures in the public interest. The resent $500 million ISDS lawsuit against Canada by a US pharmaceutical giant who lost its patent decision at all three levels of our courts (which would result cheaper generic versions to being available to Canadians) highlights the danger in these provisions and may be the tip of the iceberg if CETA is ratified. With the powerful European pharmaceutical lobby there are billions and billions more at risk as this mechanism allows them challenge reasonable laws and public policy that dares stands in the way on exploiting people for massive profits.

Our Premiers have worked to try to reduce public drug costs since 2010, and while there has been moderate success, it shifts the burden to other areas (there has been significant cost increases in private plans during this time).  This is not a real solution and is not providing Canadians with the access to quality health care they need. Our premiers know as well as we do that under CETA it would become even more difficult to reduce skyrocketing drug costs. If CETA is ratified the likely hood of a National Pharmacare Plan becomes substantially more difficult (if possible at all) as we would face billions of dollars in lawsuits under the ISDS mechanism from European pharmaceutical companies. 


Universal Pharmacare Now!

It is now or never if we want to introduce Universal Pharmacare, Canadians cannot afford not to have it.  This would not only make access to medicines more equitable across the country and improve health outcomes, but it would also generate savings of 10% to 41% on prescription drugs for all Canadians of up to $11.4 billion annually.  Private drug insurance plans lack the bargaining power (and will) to pay less for drugs (7% more for generic drugs and 10% more for non-patented brand-name drugs).  These plans formulas prefer new expensive drugs (such as those pushed in CETA) even if they are no more beneficial to patients than cheaper existing drugs.  A Universal Pharmacare Program is a opportunity to build capacity to improve healthcare access and practices, reduce costs, and most important help to ensure the long term sustainability of our public health care system. It win-win for patients, for employers, employees and provincial/federal budgets, and for the Canadian economy. Now more than ever we need to protect, strengthen and expand our public healthcare. Our Premiers have all the information and tools to start this program before it is too late, and know that CETA is a poison pill that could derail national pharmacare and our whole public healthcare system.  It is time for real leadership that puts the health of Canadians first.

Take action!

If you are in Charlottetown, PEI tonight join in a town hall discussion about our public health care


Tuesday, August 26, 6:30 pm – 8:30 pm


Rodd Charlottetown, 75 Kent St, Charlottetown


Maude Barlow, National Chairperson of the Council of Canadians

Paul Moist, National President of the Canadian Union of Public Employees

Michael McBane, National Coordinator, Canadian Health Coalition


Leo Broderick, Community and peace activist


For more information, statistics sources and resources about our Health Campaign follow http://www.canadians.org/healthcare

For a more in depth look at CETA and health care please see:

In the name of 'free trade' our public health care system is forces to swallow another poison pill





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