Introduction to the Pricing Doc

Canadian Pharmaceutical Spending: 50% of the cost for 2% of the population

In Canada, public drug program spending exceeded approximately $20 billion in 2024, and total pharmaceutical expenditures approaching $40 billion annually when private insurance, hospital medications, and cancer therapies are included.¹ Historically, medication spending was driven primarily by the number of users. Increasingly, however, costs are being driven by a small number of high-cost medications. Approximately 50% of public drug spending is now attributable to about 2% of patients receiving medications costing more than $10,000 annually.¹ Biologics alone account for nearly 30% of public drug spending in Canada.^1,2

At the same time, some commonly prescribed medication classes are becoming more affordable through generic competition and biosimilar availability. For example, many chronic disease medications are expected to decrease substantially in price over the coming years. However, rapid uptake of newer expensive medications — particularly GLP-1 receptor agonists such as semaglutide — continues to drive major increases in drug spending. Canadian total (public and private) spending on semaglutide is around $2 billion annually.² Generic semaglutide was approved in Canada in April 2026 and use could potentially save hundreds of millions of dollars annually.

Canada has one of the lowest rates of biosimilar uptake among OECD countries.^1,3 Evidence demonstrates that biosimilars provide similar clinical outcomes and safety compared with originator products.^4,5 British Columbia leads all provinces in their biosimilar initiatives, saving $730 million over five years without increasing healthcare utilization or adverse patient outcomes.^6,7

Similarly, evidence suggests that in several therapeutic areas, lower-cost medications within a class provide comparable patient-oriented outcomes to substantially more expensive alternatives.

Examples of evidence and cost informed prescribing for primary care practitioners include:

• Using generics or low-cost alternatives when available: for example:
  • generic semaglutide
  • dapagliflozin as a lower-cost SGLT2 inhibitor
  • Encouraging and educating patients about biosimilars being equivalent clinically to originator products
• Discouraging use of expensive medications with limited benefit (ex. PCSK9s for CVD)⁸ or medications with no evidence for patient-oriented outcomes (ex. DPP-4s for T2Ds)⁹

In addition to selecting lower-cost therapeutic alternatives, other strategies to reduce medication expenditures include:

• Prescribing for longer durations for stable chronic medications
• Tablet splitting when appropriate:
• Most medications have flat pricing (similar costs across different doses). Splitting a tablet in half for medications with flat pricing would reduce the cost by 50%. For example, empagliflozin evidence finds 25 mg and 10mg have similar CV outcomes for type 2 diabetics.¹⁰ Splitting 25mg tablet in half would save 50% of the cost while getting the same CV benefit as a 10mg tablet.
• Using combination products where possible:
  • Many BP products have formulation with added diuretic which costs similar to the most expensive single product. Combining these may help cost and decrease pill burden for patients.
    
    

Canada remains the only OECD country with universal healthcare coverage that does not yet provide universal pharmacare coverage for outpatient prescription medications. In 2024, the federal Pharmacare Act initiated limited national coverage for diabetes medications and supplies, oral contraceptives, and some menopause hormone therapies in participating provinces and territories.¹¹ While a few provinces have signed onto this initiative, broader implementation of the national pharmacare programs could substantially reduce drug expenditures and improving medication access.

In Alberta, several commonly used medication classes — including ACE inhibitors, ARBs, calcium channel blockers, statins, and proton pump inhibitors — are subject to maximal allowable cost (MAC) pricing policies. Additional information regarding Alberta’s MAC pricing and biosimilar initiatives can be found through Alberta Blue Cross and provincial formulary resources.

We are pleased to provide the updated Price Comparison of Commonly Prescribed Pharmaceuticals in Alberta for 2026. We encourage prescribers to consider medication cost, formulary coverage, and evidence for patient-oriented outcomes when selecting therapies — particularly when choosing among therapeutically similar medications.