The province’s new Pharmacare program announced in last week’s budget, designed to cut the price the province pays for generic drugs, isn’t being met with enthusiasm by Alberta pharmacists.
Although the government is expected to save $90 million through the program next year by reducing the price of generic drugs from 35 per cent to 18 per cent, pharmacists in the riding are crying foul about the potential impact to their profit margins.
“One of the things I’m hearing an awful lot about is the health ministry’s decision to cut back on what pharmacists are going to be able to earn,” said Cardston-Taber-Warner MLA Gary Bikman.
“A lot of the pharmacists that I’ve talked to — there’s probably been a dozen that have called me, or written to me — some are indicating they’ll be forced to lay off staff, one said his profits in the coming year will be cut by 50 per cent, another who had just bought a pharmacy six months ago now said his budget projections that he used to get his bank loan are way off base, there’s no way he’ll be able to meet his payment obligations. So the government, with the stroke of the legislative pen, is forcing, if you will, private businesses — which small pharmacies are — into dire straits.”
Lost revenue to pharmacists and generic manufacturers is expected to be higher due to a high percentage of prescriptions in the province that are paid for privately.
Pharmacists currently receive a dispensing fee, but their profits are also dependent upon payments from generic drug manufacturers based upon drug price.
Bikman called the decision an opportunistic attempt by the province to offload costs onto small business.
“It’s not because of economic conditions, it’s because they’re once again trying to download the cost of providing subsidies on the backs of small businesses and local taxpayers.”
In the past, when the provincial government chose to reduce the cost of generic drugs, roughly $100 million in transitional funding had been provided to pharmacists to help cover the cost of a price reduction to keep the industry afloat.
But that contingency appears to be off the table this time with the province mired in economic woes, according to statements made by Health Minister Fred Horne to the provincial media.