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Quebec moves to introduce a tendering system for drugs

Reading Time 3 minute read


Life Sciences Bulletin

On November 24, 2015, Quebec Minister of Health and Social Services ("Minister"), Gaétan Barrette introduced Bill 81, An Act to reduce the cost of certain medications covered by the basic prescription drug insurance plan by allowing calls for tender to the National Assembly.

Bill 81 would amend the Act Respecting Prescription Drug Insurance (CQLR c A-29.01) to enable the Minister to issue a call for tenders to enter into a contract with an accredited drug manufacturer for the purpose of establishing the price of a medication or supply and the conditions for its entry on the list of medications, the cost of which is covered by the basic plan ("List of Medications").

The Bill would consolidate hospital and pharmacy purchasing and encourage wholesaler and manufacturer competition in order to generate savings, explains Minister Barrette, "[TRANSLATION] Although the price of generics has fallen slightly in recent years, we believe that Quebec could see substantial savings by encouraging greater manufacturer competition. Bill 81 will allow us to ensure that Quebeckers have fair and appropriate access to the medications they require."

The proposed measures would allow the Minister to issue a call for tenders to enter into a contract with a drug manufacturer for a medication or supply, which would then be granted a period of exclusivity on the List of Medications.

All other medications or supplies covered by the call for tenders would be excluded from the List of Medications. However, the Minister may, where applicable, include the original drug as an exceptional medication on the List of Medications, meaning that when physicians issue a prescription with the marking "do not substitute", the brand-name drug would still be available.

Bill 81 would also allow the Minister to issue a call for tenders to enter into a contract with an accredited wholesaler establishing the conditions for the provision of the medication or supply to owner pharmacists and establishing the wholesaler's mark-up.

Such a contract would grant the selected wholesaler exclusivity to provide the medication or supply to owner pharmacists in Quebec, who would be able to procure it from that wholesaler only.

The conditions and mechanics of the calls for tender would be determined by ministerial regulation once the Bill has been passed.

The Bill ensues from the last-minute amendments that Minister Barrette attempted to table before the parliamentary committee as part of its consideration of Bill 20, an Act to enact the Act to promote access to family medicine and specialized medicine services and to amend various legislative provisions relating to assisted procreation.

The Parti Québécois opposed the submission of that amendment on the grounds that evaluating such a material change would require more time.

Bill 81 is consistent with the government's pattern of cutting expenditure in order to limit the financial burden on the health system. Use of competitive tendering on this scale could have a considerable impact on the generic and wholesale business model and on overall market conditions in the pharmaceutical industry. This tender process could include changing the rules in respect of professional allowances paid to pharmacists.

The Bill also raises issues regarding access to medications, especially in cases of drug shortages.  Similarly, its potential impact on branded drugs remains uncertain, particularly in respect of loyalty programs.

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