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Ontario Takes Additional Legal Action In Drug Purchasing Scheme

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Ontario Takes Additional Legal Action In Drug Purchasing Scheme

Part of "Drug Purchasing" Scheme Revealed in April

Ministry of Health and Long-Term Care

Ontario is taking legal action against more pharmacies and wholesalers that have been involved in a scheme where drug products were being sold several times.

The Ministry of Health and Long-Term Care's Ontario Public Drug Programs conducted audits at pharmacies, generic manufacturers and wholesalers after finding discrepancies in the reporting of professional allowances paid and received. Professional allowances are monies generic drug manufacturers pay pharmacies for buying their prescription drug products.

The Ontario government:

  • Has laid further provincial offence charges for providing false or incomplete information or obstructing an inspector - against another wholesaler and individual
  • Has put another pharmacy on notice that their pharmacy subscription agreements - which allows it to work within the Ontario Public Drug Programs - may be terminated and suspension orders issued
  • Is issuing demand letters that require three pharmacy groups to provide information on professional allowances (these may be followed by full-scale audits)

In April, the government took enforcement actions against a number of pharmacies, generic manufacturers and wholesalers. Further audits are ongoing. 

There is no cap for the private market; however, as with the ODB market, these allowances must be used for activities outlined in the regulations.

Quick Facts

  • Through changes made by Bill 102 to the legislation that governs Ontario's publicly funded drug programs, the government is improving patient access to prescription drugs, ensuring better value for money spent on prescription drugs, strengthening the accountability within the drug system, and ensuring that pharmacists are valued and compensated for the important services they provide.
  • This legislation, the Transparent Drug System for Patients Act, 2006, made changes to the Ontario Drug Benefit Act (ODBA) and the Drug Interchangeability and dispensing Fee Act (DIDFA).
  • Under the Ontario Drug Benefit Act and the Drug Interchangeability and Dispensing Fee Act:
    • Drug manufacturers are required to report to the government, on a biannual basis, the amount of professional allowances paid out to pharmacies.
    • Pharmacies are required to report the amount of professional allowances they have received.
    • Pharmacies are required to report on how professional allowances are spent, with the requirement that they must be used for direct patient care.
    • Professional allowances are capped at 20 per cent for the Ontario Drug Benefit plan (ODB) market.

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