Report: Canada could save $770 million by switching these three drug classes to OTC

OTTAWA — A new Conference Board of Canada report estimates that switching three prescription drug classes to over-the-counter status could represent a cost savings of more than $770 million annually (in U.S. currency). Those classes include proton-pump inhibitors, oral contraceptives and erectile dysfunction remedies.



In the U.S. market, PPI sales totaled more than $620.2 million for the 52 weeks ended Dec. 25 across total U.S. multi-outlets, according to IRI. Pfizer's Nexium 24HR is the best-selling antacid tablet on the market with $306.5 million in sales on 1.4% growth.



And ED as a potential OTC class of medicines is expected to be pursued by Sanofi/Chattem this year. In 2014, Sanofi acquired the OTC rights to Cialis from Eli Lilly. Patents protecting Cialis expire in 2017.



"Removing the need to obtain a prescription from a physician for select medications can help improve access for some Canadians through greater convenience and at a lesser cost," stated Louis Thériault, VP public policy, The Conference Board of Canada. "It also alleviates some of the pressure on Canada's strained health care system by decreasing the number of unnecessary doctor visits."



Overall, the annual economic value of switching is estimated at $527 million for proton pump inhibitors, $165 million for oral contraceptives and $78.8 million for erectile dysfunction drugs. The greatest savings would stem from lower drug costs, approximately $340.3 million. While reduced physician visits and increased economic productivity would save $215.4 million and $215.1 million respectively.



Public insurers stand to gain the most from the switches, followed by employers and private drug plan sponsors. Individuals who currently do not have access to the best prescription drug coverage would also see significant savings, due to the lower cost of over-the-counter medications and removal of dispensing fees. On the other hand, individuals currently covered under a drug plan with low or no deductibles and co-payments would incur additional costs from having to purchase the medication over the counter.



The report, in addition to identifying the economic benefits of switching, also discusses some of the risks of switching, such as misdiagnosis, misuse and adverse events, all of which are reviewed by Health Canada before approving individual medication switches.