On March 30, 2020, the Ontario government launched two one-day consultations on changes to regulations concerning the listing of generic drug products under the Ontario Drug Benefit Act (ODBA) and the Drug Interchangeability and Dispensing Fee Act (DIDFA). These consultations end March 31, 2020.
Both changes are said to be needed to help mitigate the risk of drug shortages in Ontario during the COVID-19 pandemic.
Private-label generics eligible for listing
As we previously reported, the Ontario government took steps late last year to permit the listing of private-label generic drugs on the provincial drug formulary under the ODBA and DIDFA. The change was set to take effect on July 1, 2020. The government has now posted an amendment to the regulation to allow the changes to take effect on April 1, 2020.
Consultation on this amendment closes March 31, 2020.
Formulary price for generics: adopting the pCPA approach
The Ontario government has also introduced amendments to Ontario Regulation 201/96 under the ODBA with respect to how the formulary prices for generic drugs are calculated. The amendments allow a generic drug manufacturer to apply for listing of a product at ≤25% of the price of the original product as set out on the formulary either:
- on the date the product is first proposed for designation as a listed drug product if no other product has been designated as interchangeable with the original product, or
- in all other cases, on the date when the first product became designated as interchangeable with the original product.
Under the current regulation, the date of the reference price of the original product used for this calculation could vary depending on how many generic products had already been listed on the formulary.
Notwithstanding the above, the amendment also gives the Executive Officer the authority to “adjust” the drug benefit price of the original reference product, having regard to certain factors, for the purpose of calculating the drug benefit price of an interchangeable product. In doing so, the Executive Officer shall not change the actual drug benefit price of the original product on the formulary.
The government has stated that these changes align Ontario’s approach with the other provinces and territories as well as the pan-Canadian Pharmaceutical Alliance (pCPA). Consultation on this amendment also closes March 31, 2020.
For more information on the legal implications of COVID-19, please consult our COVID-19 Hub. As a full service global firm with offices across Canada, Norton Rose Fulbright is closely monitoring this evolving situation over a number of practice areas including employment and labour, risk advisory, banking and finance, corporate, M&A and securities, and dispute resolution and litigation, and across a variety of industries including energy, infrastructure, mining and, financial institutions, life sciences and healthcare, technology and innovation, and transport.