This week, Pharmacare promises face increasing scrutiny as funding delays, provincial hesitancy, and looming Health Canada cuts erode confidence in access. Meanwhile, President Donald Trump has turned up the heat on drugmakers and trading partners alike, using tariffs and executive orders to reshape the global pharmaceutical market. Canada finds itself caught between promises made and pressures mounting.
Pharmacare Rollout Falters Amid Backlash from Provinces and Advocates
Despite the passage of the Pharmacare Act, passed as Bill C-64, the path to national drug coverage remains rocky. With just three provinces and one territory signed on, most Canadians are still without access to the promised coverage for diabetes and birth control drugs.
NDP Leader Don Davies slammed the Liberal government for failing to expand the program, while New Brunswick delayed their signing due to what Health Minister John Dornan said stemmed from an insufficient federal offer. Dornan also claimed that the province’s existing coverage is adequate. Steven Staples of the Canadian Health Coalition disputed this, arguing that many Canadians still struggle to afford prescriptions and urging New Brunswick to join the program.
The Canadian Press reported that the federal government’s failure to finalize pharmacare agreements with most provinces has sparked concern among reproductive health advocates, who warned it could create deep regional inequities.
Critics argued that the government’s stalled commitments undermine universal access to contraceptives and diabetes medications promised under the Pharmacare Act’s first phase, as well as women’s health more broadly, calling for stronger federal leadership amid rising economic pressures.
Health advocates and opposition leaders warned the move sends a “bad signal” to provinces and could jeopardize the future expansion of the national pharmacare program in the face of federal budget cuts. A study by the Canadian Centre for Policy Alternatives revealed that four out of five Canadians remain excluded from national pharmacare as most provinces have yet to sign funding agreements, missing out on billions in federal support.
Prime Minister Mark Carney’s silence on pending pharmacare deals with provinces like Ontario is raising alarm among health experts and advocates, who say the Liberal government is backtracking on a key campaign promise. While Health Minister Marjorie Michel confirmed that Ottawa will proceed with four signed deals, she was noncommittal about expanding agreements to the rest of the country. Critics say the lack of urgency threatens to deepen regional health inequities and undermines Canadians’ trust in the government’s commitment to universal drug coverage.
Further complicating matters, the Canadian Life and Health Insurance Association (CLHIA) publicly backed Diabetes Canada’s cautious stance and urged the federal government to re-evaluate its pharmacare program, emphasizing the benefits of preserving effective private insurance coverage systems.
Diabetes Canada and reproductive health advocates also pressed the federal government to revise its pharmacare program, warning that limited funding deals have created unequal access to essential medications. The call comes as only four jurisdictions signed pharmacare funding deals before the federal election, leaving a majority of provinces without access to the program’s initial offerings for diabetes and contraceptive medications.
Health Canada also came under fire for plans to cut nearly $1 billion in program spending and reduce its workforce by almost 2,000 by 2027–28, raising concerns from groups like the Canadian Health Coalition.
The reductions, linked to expiring funds for rare disease and emergency treatment programs, have prompted uncertainty over the future of national pharmacare and dental care initiatives introduced under former Prime Minister Justin Trudeau, as the Carney government signals a more restrained fiscal approach.
Trump Escalates Drug Price Crackdown with Tariffs, MFN Pricing, and Industry Warnings
The Trump administration is rewriting the rules on drug pricing, and Canada, the same as other countries, may pay the price. A series of aggressive moves this week has alarmed drugmakers, analysts, and health systems alike.
U.S. President Donald Trump intensified his campaign against high prescription drug prices by sending a series of letters to the CEOs of 17 major pharmaceutical companies. These letters demanded that they implement a “most favoured nation” (MFN) pricing strategy, matching U.S. drug prices to the lowest prices available in comparably developed nations.
The drug manufacturers targeted include prominent names like Eli Lilly, Pfizer, AbbVie, Merck & Co., AstraZeneca, and several others. Companies were given a 60-day ultimatum to comply or face government action, including the use of tariffs.
Despite the bold approach, analysts and industry experts remain skeptical about the feasibility of Trump’s demands, citing the limited power of the administration to compel these changes unilaterally. Some companies have expressed willingness to negotiate.
In response to U.S. President Donald Trump’s most favoured nation (MFN) drug pricing policy, a joint venture between two manufacturers launched a direct-to-consumer distribution model to offer discounted medication to under- and uninsured patients. Another company is considering a similar move and is reportedly in talks with the Trump administration.
President Trump’s executive order mandates that U.S. drug prices match the lowest prices in peer countries under an MFN pricing policy. In addition, the order instructs federal agencies to promote direct-to-consumer drug sales and target anti-competitive behaviour.
A JAMA editorial criticized the MFN policy, calling international reference pricing a flawed approach to controlling U.S. drug costs. The authors argued that domestic factors like pharmacy benefit managers (PBMs), not foreign pricing, drive high U.S. drug prices.
Similarly, Adam Fein, President of the Drug Channels Institute, warned that reference pricing could harm innovation and undervalue critical medicines. Though he opposes government-led pricing models, he views the MFN approach as economically unsound.
Jim Keon, head of the Canadian Generic Pharmaceutical Association, highlighted that though Canada contributes a modest five per cent to U.S. drug imports, such tariffs could lead to increased medication costs and potential drug shortages in Canada, adversely affecting healthcare systems like B.C. PharmaCare.
Jason Field, CEO of Life Sciences Ontario, emphasized the broader implications for Canada’s pharmaceutical sector due to its integrated global supply chain. Tariffs could dissuade companies from manufacturing drugs or conducting clinical trials in Canada, risking job losses and decreased availability of clinical trials crucial for early treatment access.
The U.S. Food and Drug Administration’s plan to let states import cheaper Canadian prescription drugs drew criticism from health policy experts, who warned it could flood the U.S. market with dangerous counterfeit medications. Analysts also pointed to logistical barriers, higher generic drug prices in Canada, and potential threats to pharmaceutical innovation as reasons to avoid foreign importation.
A policy expert argued that regulatory flaws are the primary drivers of high drug prices in the U.S., pointing to third-party payer disincentives and inefficient rebate systems as key culprits. Critics instead pushed for reforms targeting Pharmacy Benefit Managers, saying that would reduce costs for seniors without threatening access to key treatments.
Meanwhile, Republican senators supported using trade policy and leadership appointments to address international price gaps but urged caution over foreign importation.
Carney Taps Liberal Strategist Harry Burton as Atlantic Advisor
Prime Minister Mark Carney appointed longtime Liberal strategist Harry Burton as his new regional advisor for Atlantic Canada. Other staffing updates include Miled Hill’s return as senior policy advisor and Peter Wall’s appointment as director of communications for the Artificial Intelligence Minister.
As the policy landscape shifts both at home and abroad, our Executive Daily Briefing tracks it all, customized to your needs. Book a free consultation today!
