Influence of CETA on generics

On 18 October 2013, the European Union (EU) and Canada reached a political agreement on the key elements for a Comprehensive Economic and Trade Agreement (CETA). However, CETA has been criticized for the fact that it affects intellectual property rights in Canada, but not the EU. Some of the provisions included in the agreement are seen as having the potential to have a negative affect on the generics industry in Canada.

On a per capita basis, Canadian drug costs are already the second highest in the world after the United States and are among the fastest rising in the Organization for Economic Cooperation and Development (OECD). However, an analysis by Canadian researchers estimates that CETA’s provisions will increase Canadian drug costs by between 6.2% and 12.9% starting in 2023 [1].

Three provisions in CETA are seen as causing issues for the Canadian generics industry:

Committing Canada to creating a new system of patent term restoration thereby delaying entry of generics by up to two years
Locking in Canada’s current term of data protection, and creating barriers for future governments wanting to reverse it
Implementing a new right of appeal under the patent linkage system that will create further delays for the entry of generics

The analysis estimates that CETA would delay the entry of generics by 358.4 days, or 0.98 years, on average and that additional costs of CA$795 million per year. If CETA extends data exclusivity to non-innovative drugs, the average delay would increase by 741 days, or 2.03 years, which represents an additional yearly cost of CA$1,645 million.

Reference
1. Lexchin J1, Gagnon MA. CETA and pharmaceuticals: impact of the trade agreement between Europe and Canada on the costs of prescription drugs. Global Health. 2014;10:30.

Source: www.gabionline.net

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