Canada's R&D based drugmakers not reaching 10% research-to-sales ratio commitment

Brand-name drug companies' research and development spending as a percentage of sales in Canada is less than half of the 10% the industry committed to when their periods of market exclusivity were first increased in 1987, according to the most recent annual report from the federal government's Patented Medicine Prices Review Board (PMPRB).

The PMPRB's latest annual reports shows that, in 2017, member companies of Innovative Medicines Canada spent only 4.6% of their Canadian revenues on R&D in Canada, marking the 15th consecutive year they have failed to meet the 10% threshold. According to the PMPRB 2017 Annual Report, member companies of Innovative Medicines Canada have failed to meet their 10% commitment in 20 of the last 30 years.

"Brand-name drug companies received yet another costly gift at the expense of Canada's health-care system in the recent United States-Mexico-Canada Agreement (USMCA) trade deal," said Jim Keon, President of the Canadian Generic Pharmaceutical Association (CGPA). "Today's report is further evidence that extending market monopolies does not lead to increased investment in Canada."