March 2025 saw a flurry of developments in Canada’s emerging national funding systems of drugs for rare diseases and pharmacare. All of Canada’s 13 provinces and territories have now reached bilateral agreements with the federal government to cover certain drugs for rare diseases, while three provinces and one territory have now reached bilateral agreements with the federal government to provide universal, single-payer, first-dollar coverage of certain contraceptives and diabetes medications.

Rare disease agreements

In March 2023, a National Strategy for Drugs for Rare Diseases was announced, including up to $1.4 billion of funding over three years for the provinces and territories through bilateral funding agreements with the federal government (our report here). As part of the national strategy, a “common list” of new drugs for rare diseases is being developed.

After six bilateral agreements were announced in March 2025, all 13 provinces and territories have now agreed to accept funding and provide coverage for certain drugs for rare diseases. Health Canada has published: (i) the funding agreements; and (ii) which of the drugs on the common list each province and territory has elected to make available to its residents.

Pharmacare agreements

As we reported, An Act respecting pharmacare (the Pharmacare Act) came into force on October 10, 2024. The Pharmacare Act sets out the “foundational principles” for the first phase of a national, universal, single-payer, first-dollar drug coverage plan. In the first phase, the federal government is to make bilateral agreements with provincial and territorial governments to fund prescription drugs (and related products) for contraception and diabetes.

On February 27, 2025, Manitoba became the first province to announce a bilateral agreement, followed by British Columbia on March 6, 2025 (our reports here and here). Two more bilateral agreements have now been reached:  

  • Prince Edward Island announced an agreement on March 7, 2025. Residents can anticipate beginning to receive coverage on May 1, 2025.
  • Yukon announced an agreement on March 20, 2025. Residents can expect to start receiving coverage no later than January 2026.

Health Canada has published the four bilateral agreements under national pharmacare. The specific contraceptive and diabetes drug products covered in the four jurisdictions – and conditions of coverage –  are listed on Health Canada’s “What’s covered by national pharmacare” webpage.   

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