Yukon government pays top dollar for its drugs

A government-sponsored review of our health-care system has determined Yukoners pay 44 per cent more for prescription drugs than most other Canadian jurisdictions. Pharmacies in the territory mark up their drugs 30 per...

A government-sponsored review of our health-care system has determined Yukoners pay 44 per cent more for prescription drugs than most other Canadian jurisdictions.

Pharmacies in the territory mark up their drugs 30 per cent. Also, there’s a 14 per cent wholesalers’ markup.

On top of that, there’s an additional $8.75 dispensing fee, per prescription.

The pricing is based on a 1995 government agreement with pharmacists that expired in 1997.

It hasn’t been renewed.

“Under the terms of this agreement, the Yukon government is paying a higher markup rate on the cost of drugs than other jurisdictions,” says a Yukon government pharmacare audit released last year.

The markup “is one of the highest in the country,” according to the Yukon Health Care Review, released in September.

“As drug prices increase, the markup increases proportionally,” says the 260-page report.

So, a $1,000 drug would net a Yukon drugstore a $300 markup.

“The additional work and dispensing costs associated with dispensing a $1,000 drug versus a $50 drug, one could argue, are marginal at best,” says the review.

And drug prices are increasing.

“Money spent on pharmaceuticals is consuming an increasing size and proportion of health-care dollars, and the costs are escalating faster than the rate of inflation,” says a January report by the Health Council of Canada.

The 36-page report, called the National Pharmaceuticals Strategy: A Prescription Unfilled, paints a grim picture.

“The rising cost of prescription drugs is significantly straining government health budgets, raising serious questions about sustainability,” it says.

“Prescription medications can be prohibitively expensive for both Canadians and their insurers, particularly governments and employers.

“Governments say that drug-plan-expenditure growth squeezes out other Health Department priorities, and that overall health-budget growth crowds out other government priorities, including education and public infrastructure,” says the report.

In 2008, the Yukon government spent $5.8 million on prescription drugs.

Of this, $690,616 covered pharmacy-dispensing fees for filling prescriptions.

BC’s markup on drugs is seven per cent of the actual acquisition cost, compared to the Yukon’s 44 per cent markup.

“Individual governments have various programs to improve the accessibility, safety, and affordability of prescription medications,” says the Health Council report.

“This patchwork of different initiatives across the country means that not all Canadians have the same advantages.”

“As far as I’m aware, prescriptions cost more in Nova Scotia,” said Pharmacy Society of Yukon president Pam Zinck, when asked about the Yukon’s high drug costs.

Drugs may cost less in BC and Alberta, she added.

But the territory has “such comprehensive public coverage,” said Zinck.

Because of government programs, like those for seniors or people suffering from chronic disease, it’s rare that someone falls through the cracks, said pharmacy society member Carol Yamada.

Neither Yamada nor Zinck would comment on the 44 per cent markup on prescription drugs in the territory.

That’s between pharmacy owners and the government, said Yamada.

The smaller market affects drug procurement in the North, “just like getting doctors,” said Yukon Medical Association president Rao Tadepalli.

It’s important to keep drug prices low, said Yukon chief medical officer of health Brendan Hanley.

“Affordable drugs are such an important part of sustainable health care,” he said.

“Pharmacies, which are the recipients of much of the Yukon spending on the drug programs, are not audited to recover funds or to deter potential abuse,” according to the government audit.

Medicine Chest owner Jim Lindsay and Shoppers Drug Mart owner Darrell Pasloski did not return calls made last week.

The Health Department also refused comment.

Contact Genesee Keevil at gkeevil@yukon-news.com