There have been a number of decisions dealing with access to commercial information held by the Ministry of Health and Long-term Care in Ontario (“Ministry”) under the Freedom of Information and Protection of Privacy Act (FIPPA). This update provides an overview of decisions rendered by the Information and Privacy Commissioner of Ontario (IPC) that have issued over the past several months. Given that pan-Canadian price negotiations between pharmaceutical manufacturers and the provinces are becoming commonplace, how company information is treated by governments is a relevant issue for companies to consider. The focus of this update is on Ontario. However, access to information laws differ in each province and their application should be considered in light of provincial legislation and case law.
Release of information relating to payments made by companies to governments
Records relating to pricing under the Ontario Drug Benefit Program - the government drug coverage plan for certain citizens - have been the subject of a number of requests for information under FIPPA in the past few years. In January 2010, the IPC adjudicated three matters relating to the Transparent Drug System for Patients Act, 2006 and allowed the release of various types of information relating to product listing agreements reached between pharmaceutical manufacturers and the Ministry. The information released included amounts paid per manufacturer to the government as volume discounts and other forms of payment. The Ministry had argued against release, and manufacturers, who were not given prior notice, only learned of the release after it had occurred.
In June 2010, in respect of a request seeking information relating to a sample of a final listing agreement with a named drug company, the IPC upheld the Ministry’s decision to partially disclose certain information. However, in that case, the IPC withheld from disclosure the volume discount paid by the drug manufacturer to the Ministry. The IPC agreed with the Ministry’s position not to disclose on the basis that the information fell within the governmental exemption aimed at protecting the economic and financial interests of the Ministry. The IPC found “that disclosure of the information at issue could reasonably be expected to discourage drug manufacturers in the future from negotiating large volume discounts and other favorable financial terms with Ontario, out of concern that this information could be used by their other public and private sector customers seeking to negotiate similar discounts with the drug manufacturers”. In addition, the IPC did not find a compelling public interest to disclose the payment information, as was argued by the requester.
Earlier this year, the IPC released two decisions dealing with requests for access to similar information as that in the prior cases, including records relating to pricing and listing agreements between the Ministry and named drug manufacturers for drug products listed on Ontario’s formulary. One request was for a re-release of the same information ordered to be disclosed in the three prior orders from January 2010; the other involved information contained in two agreements between a named drug manufacturer and the Ministry. In the result, the IPC upheld the Ministry’s decision to disclose some of the requested information; however, consistent with the June 2010 decision, the information on specific payments and the formulas for calculating payment arrangements were withheld from disclosure.
Links to Decisions:
Release of information on payments to pharmacies
On May 31, 2013, the IPC released two orders relating to a request for information for access to the amount of “professional allowances” received by and/or paid to certain named pharmacies. The Ministry had identified 27 records as responsive to the request and claimed that payment information was exempt as it constituted third-party commercial information. The requester appealed the decision of the Ministry, arguing that there is a compelling “public interest” to disclose the information, as permitted under FIPPA. Six drug manufacturers, who were notified as affected parties relating to their payment information, objected to the proposed disclosure of information (other than payments, which the Ministry was not going to release) as contained in the professional allowance reporting forms and appealed the Ministry’s decision in that respect.
In Order PO-3209, the requester’s appeal, the IPC upheld the decision not to disclose the quantum of professional allowances paid by the drug manufacturer. Since the amount paid as professional allowances arises in the private commercial context between a drug manufacturer and pharmacy, and the reports of professional allowances paid, being a statutory requirement, were supplied to the Ministry in confidence, this information was exempt from disclosure.
The IPC accepted the drug manufacturers’ position that the harm that would result from the disclosure of this information would include economic loss, interference with contractual relationships between the manufacturer and the pharmacy, and prejudice to its competitive position in the market amongst drug manufacturers. The IPC also found that the requester’s argument for public interest disclosure of this information did not apply. The information sought did not meet the threshold of being a “compelling public interest” rather, the payment information of professional allowances was private in nature.
The second order, Order PO-3210, relates to the drug manufacturers’ appeal and the information that the Ministry proposed to disclose on the basis that it did not fall within one of the exemptions under FIPPA. The IPC found that the third-party commercial information exemption did not apply to any information other than the quantum of professional allowances.
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Release of information on contracts with hospitals
Earlier this year, the IPC adjudicated three appeals involving requests made to hospitals for access to vendor contracts for infant formula, including records describing any benefits, gifts or non-monetary compensation received by the hospital. The vendor objected to the disclosure of the requested information, claiming that the mandatory exemptions for third-party commercial information and personal information applied to the agreements. In spite of this objection, the hospitals were prepared to disclose the agreement, which the third party appealed to the IPC. The IPC agreed with the hospitals’ position to allow full access to the agreements, finding that,
“[t]he contents of a contract involving an institution will not normally qualify as having been supplied for the purpose of section 17(1). The provisions of a contract, in general, have been treated as mutually generated, rather than “supplied” by the third party, even where the contract is preceded by little or no negotiation or where the final agreement reflects information that originated from a single party.”1
The decision upholds the principle that contracts containing mutually agreed upon terms that result from negotiation between the parties do not necessarily fall under the third-party commercial information exemption under FIPPA. The IPC agreed with the hospital’s position that standard contract templates did not prejudice the competitive position of the affected third party in respect of future negotiations. Further, the IPC stated that the vendors were sophisticated parties that would not be in a position of weakness from the disclosure of the contracts. These decisions illustrate that contracts negotiated between hospitals and vendors may be subject to disclosure, although it should be recognized that other exemptions (including those that a government is entitled to claim, as in the case of the product listing agreement payments) may be held to apply in a given circumstance.
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The above-mentioned decisions in Ontario provide examples of some circumstances where the release of information has been allowed or where statutory exemptions preventing disclosure have applied. While these decisions provide some guidance on the potential release of confidential information provided to government institutions, each case must be determined on its own facts.