Drugs we negotiate

Different types of drugs follow different paths to public reimbursement, and we leverage our pCPA processes accordingly.

Brand-name drugs

Brand-name drugs (also called originator drugs) are the first version of a drug approved and marketed in Canada. They can include both traditional small-molecule drugs (often pills or tablets) and more complex therapies, like biologic drugs.

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Patent and data protection

Brand-name drugs usually have patent protection, which prevents competition in the form of generic copies for a set period. When the patent expires, other companies may produce generic versions. The brand-name drug becomes the Canadian reference product (CRP) — the standard that generic versions are evaluated against.

Negotiation approach

Most of our negotiation activity is with new brand-name drugs. The majority of negotiations follow our standard negotiation process. We also have other pathways we can leverage to support timely negotiation, depending on drug eligibility.

See Different approaches for different drugs

Biologic drugs

Biologic drugs are brand-name drugs made from living organisms or their cells, like bacteria, or human or animal tissue. Made to mimic or modify the body’s natural processes, biologic drugs are often used to treat complex or chronic conditions like diabetes, autoimmune diseases, and cancer.

Because they’re grown rather than “assembled,” biologic drugs are naturally more complex. To be approved, biologic drugs require specialized evidence and need to be carefully monitored once they are on the market.

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Patent and data protection

Like other brand-name drugs, biologic drugs are protected by patents and data exclusivity, preventing competition for a set period. When the patent expires, other companies can produce biosimilar drugs. The originator biologic drug then becomes the Canadian reference biologic drug (RBD) — the standard that biosimilars are evaluated against.

Negotiation approach

As with brand-name drugs, negotiations for biologic drugs often follow our standard negotiation process. We also have other pathways we can leverage to support timely negotiation, depending on drug eligibility.

See Different approaches for different drugs

Generic drugs

Generic drugs are typically lower-cost copies of brand-name drugs, made available after a patent expires. A generic drug contains the same active ingredient, in the same amount as the brand-name drug. A generic drug may look different in shape or size and have different inactive ingredients, like colours or preservatives, but it must be bioequivalent to receive Health Canada authorization.

Bioequivalent means that it works the same way in the body, provides the same clinical benefit, and is as safe as the brand-name drug.

According to the Patented Medicine Prices Review Board, 81% of prescription drugs sold in Canada in 2024 were generics. The same year, generic drugs accounted for just 23% of total drug expenditures.

Different pathway to public coverage

Generic drugs have a different regulatory submission process than brand-name drugs, because they’re not new therapies. They must still meet strict quality and safety guidelines.

Generic drugs aren’t subject to a health technology assessment or typical negotiations with individual manufacturers. Instead, the pCPA negotiates overarching pricing initiatives like the pan-Canadian tiered pricing framework, with the Canadian Generic Pharmaceutical Association.

See Different approaches for different drugs

Biosimilar drugs

Biosimilar drugs are usually lower-cost versions of biologic drugs that are already available in Canada and are also known as “biosimilar biologic drugs” (previously known as “subsequent entry biologics”).

Unlike generic drugs, which are typically chemically synthesized exact copies, biosimilars aren’t identical to their reference biologic drugs (RBDs) due to the natural variability of biologics made from living cells. Biosimilar manufacturers must show that their drug is highly similar to the RBD and that it’s just as safe and effective.

In recent years, public drug plans have implemented policies encouraging or requiring patients to transition from costly RBDs to more affordable biosimilar versions. As of 2023, biosimilars make up about 12% of biologic drug sales in Canada (per the Patented Medicine Prices Review Board).

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Different HTA approaches

Unlike generic drugs, biosimilars are considered new drugs and need regulatory approval.

Canada’s Drug Agency (CDA-AMC) and the Institut national d’excellence en santé et en services sociaux (INESSS) in Québec approach biosimilars differently. Like for generic drugs, the CDA-AMC doesn’t conduct health technology assessments (HTAs) for biosimilars. INESSS does conduct HTAs for biosimilars, making public listing decisions contingent on their reimbursement recommendation.

Negotiation approach

We have different pathways we can leverage to support timely negotiation for biosimilar drugs, but how and when biosimilars enter pCPA processes is distinct. See our biosimilar review process.

See Different approaches for different drugs

What we don’t negotiate

We negotiate on behalf of Canada’s public drug plans. As such, products that aren’t funded through these plans typically fall outside of our scope. This includes vaccines and most medical devices.

Vaccination programs, for example, are delivered through public health systems rather than public drug plans. Likewise, most medical devices are purchased and funded through other health-system budgets.

In some cases where products function like drug-related supplies, like diabetes test strips, the pCPA has been tasked to negotiate pricing. Our member public drug plans determine whether a coordinated negotiation approach would be beneficial in these situations, and decisions about whether to pursue a pCPA negotiation remain at their discretion.