The Competition Bureau released its Generic Drug Study on October 29, 2007. The Bureau initiated the Study in response to findings that the price of prescription generics in Canada is higher than in other countries. The Study concludes that although the generic drug market has become more competitive over the past 15 years, the benefits of that competition are not translating into lower drug prices for Canadians. Instead, the Bureau found that the majority of the benefits of the competition were being gained by pharmacies. Indeed, to compete for space on pharmacies' shelves, generic manufacturers offer rebates (averaging 40 % of the price the pharmacy is invoiced) or other payments to pharmacies in most provinces. Under the present system, in most provinces, pharmacies have limited incentive to pass on these cost savings to those who pay for them - public and private plans, people paying out of pocket, and taxpayers.
The Study states that the Bureau will be continuing its work in the generic drug sector by examining possible options for obtaining the benefits from competition and the impediments to their adoption.
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