The agreement is not in response to the current drug shortage involving generic drug maker Sandoz, but is an expansion of an existing program.
Health Minister Leona Aglukkaq says the government will boost investment in pharmaceutical research by up to $150 million over the next five years.
Under the agreement, brand-name drug manufacturers are to match the federal contribution dollar-for-dollar over the same period.
One of the goals of the program overseen by the Canadian Institutes of Health Research is to train, recruit and retain top-notch researchers in Canada.
Aglukkaq says the partnership is aimed at strengthening Canada's position as a preferred location to conduct clinical research.
"This partnership will better integrate health research and health care," CIHR president Dr. Alain Beaudet said in a release.
"By bringing together researchers and industry, this partnership will accelerate the development of new clinical practices and health products which will have a direct impact on treatment and services provided to patients."