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Healthc Policy. 2007 Aug;3(1):e121-40.

Influencing Drug Prices through Formulary-Based Policies: Lessons from New Zealand.

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Centre for Health Services and Policy Research, Department of Health Care and Epidemiology, University of British Columbia, Vancouver, BC.


A national formulary has been proposed as a priority element of Canada's National Pharmaceuticals Strategy. We review a variety of formulary-based policies that might be used in conjunction with a national formulary, drawing on the policies and practices of the Pharmaceutical Management Agency of New Zealand. We consider the potential price impact of an actively managed national formulary by conducting a Canada-New Zealand price comparison for equivalent products in the four largest drug classes: statins, angiotensin-coverting enzyme (ACE) inhibitors, selective serotonin reuptake inhibitors (SSRIs) and proton pump inhibitors (PPIs). The results suggest that potential price savings for Canada in these drug classes are on the order of 21% to 79%. Such price differences would translate into billions of dollars in annual savings if applied across Canada, potentially offsetting the costs of the expansion of pharmacare coverage necessary to achieve both equity and efficiency goals in this sector.


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