HOW SUCCESSFUL ARE CANADA'S DRUG POLICIES?

In "Cost Burden of Prescription Drug Spending in Canada and the United States: 2008 Edition," researchers compared average per-capita drug spending in Canada and the United States in order to determine whether Canada's prescription drug policies result in lower drug costs for Canadians. They found:

• In both 2006 and 2007, Canadians spent approximately 2.5 percent of their Personal Disposable Income (PDI) per capita on prescription drugs.
• Americans spent less than Canadians did in both years and averaged 2.2 percent of their after-tax income on prescription drugs in 2006 and 2.3 percent in 2007.

This information is especially pertinent because Canada and America average a very similar amount of prescriptions per person (13.7 for Canadians and 12.6 for Americans).

The researchers concluded that the Canadian government's intervention in the prescription drug market does not produce a lower drug cost burden for Canadians relative to the cost burden for Americans, who enjoy much freer markets.

[Another critical aspect to a freer market is the access to cutting edge or rare drugs, many of which the Canadian government simply bars on cost alone.]

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