CETA & the Pharmaceutical Industry

After eights years of negotiation and a dramatic EU vote, it looks like Canada’s free trade agreement with Europe is set to kick in this summer.


While this is a win for tariff free trading, it appears that the implementation of CETA will be a loss for generic drugs and a “win for the brand-name drug makers”. This is due to a technicality that will extend patent protection for new drugs beyond their current 20-year limit. According to Michael Geist, a professor at the University of Ottawa, this is a win for the EU. “Canada caved on its concern regarding pharmaceutical patent lawsuits that could potentially lead to claims with billions at stake.”


The extension of patent terms, as indicated in CETA, will increase the costs of pharmaceuticals in Canada – generic drugs are important for providing the population with affordable and quality health care. A 2010 study found that extending pharmaceutical patents by five-years would lead to a $3.5 billion increase to consumers and provincial drug plans.


The Canadian government has recognized this possibility and insisted that only new drugs will have longer patents, these may take years to reach the market. Health Canada confirmed, “CETA will not have any material impact until about the mid-2020s’. Patents are also granted, and therefore expire, on a country-by-country basis, so this larger opportunity for exportation may limit this negative term. CETA will also open up the ability to harmonize pharmaceutical manufacturing between the EU and Canada.


It seems the true cost of CETA on Health Canada and the pharmaceutical industry has yet to be determined and we will have to wait to see its effect on our health care system.


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