Health Canada Funded by Drug Companies

Before 1994, Health Canada was funded solely by tax dollars; after 1994, Drug Companies paid a fee to Health Canada for the drug approval process and those fees currently fund 50% of this process. Health Canada wants to increase that 50% to 90% and in addition, it will rebate 25 per cent of that fee if it fails to review new drug applications within a specified period of time.

This change how Health Canada is funded creates some issues.

  • Mixed goals. The public’s goal is to have safe and effective drugs. The pharmaceutical industry’s goal is to get its products approved quickly and to sell them to a large audience.
  • There is no evidence that faster drug approval is of benefit to public health; there is evidence of considerable harm.
  • Most new drugs approved in Canada are no more effective and no safer than existing alternatives. Between 2010 and 2016, only 10.6 per cent of new patented drugs were classified as a substantial improvement or a breakthrough.
  • Drugs approved in 300-days have about a one in five chance of having a serious new safety warning issued once they are on the market. If drugs are approved in 180 days, that probability rises to a one in three chance.
  • Products approved within 60 days of the Food and Drug Administration’s (FDA) mandated deadline in the United States were five times more likely to be withdrawn from the market for safety reasons and four times more likely to carry a serious safety warning than drugs approved in a longer approval process.
  • To make Drug approvals independent of pressure from drug companies, the government should eliminate drug company user fees and fund Health Canada fully through tax revenues.

Full Report

Author: Joel Lexchin, York University and University of Toronto
Date published: January 10, 2018
Title: “Health Canada might make your prescription drugs less safe”
Publisher: Maclean’s
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