OTTAWA - The provincial premiers have undertaken a letter-writing campaign to demand compensation from the federal government for any increase in drug costs that might come of a free trade agreement with Europe.
B.C. Premier Christy Clark says she and other premiers have each written to Ottawa urging federal negotiators not to agree to anything that would drive up the cost of pharmaceuticals.
Among the European Union's demands are an extension of brand-name patents for up to five years to compensate companies for time tied up in bureaucratic approvals.
They also want to extend the time that a brand-name company's recipe for a drug would remain secret from companies trying to make knock-offs.
And while Ottawa has not yet formally agreed to any of the demands, it has not ruled anything out either —leaving many provincial and federal insiders, as well as trade experts, to suspect the federal government will bend to at least part of the EU ask.
"All premiers have sent letters, I'm told, to the federal government, expressing our concern about this specific issue, because we want to make sure, as I said, that British Columbia's interests are represented," Clark told Opposition NDP Leader Adrian Dix in an exchange about drug patents on Friday.
"This is something that we've brought to the federal government's attention.... If this agreement is not concluded in a way that meets British Columbia's concerns, we would like them to reimburse us for those added costs."
Behind the scenes and in public, several provinces are ramping up their campaign to fend off European demands.
The provinces say they would amount to longer patent protection for brand-name pharmaceuticals, driving up medical bills for provincial drug plans, employer plans and individuals alike.
"The premiers are all concerned about the impact that it could have on pharmaceutical drugs and the cost of pharmaceutical drugs," Clark said, adding that the premiers discussed the issue at their last meeting this winter.
A spokesman for International Trade Minister Ed Fast did not respond to specific questions about their stand on drug patents or the premiers' letters.
"Negotiations are ongoing and we are down to focused sessions on outstanding issues," Adam Taylor said in an email.
"Solutions to the outstanding issues are being actively explored."
A recent report from Manitoba's health department pegged the cost of agreeing with European drug-patent demands at $80 million a year for the provincial government.
Economist Don Drummond recently cited research that put the cost at $1.2 billion a year for Ontarians.
Talks between Canada and the EU have graduated to the difficult stage, with both sides hoping to reach consensus by the end of the year.
Negotiators are set to meet this week in Ottawa, although it's not known whether drug patents will be part of their discussions.
Ottawa has been keen to keep the provinces on side for the deal, and no premiers have threatened to pull their support over the drug issue.
But the stakes are high for all parties.
Many of the provinces are reeling from rising health care costs and have focused on whittling away the price of pharmaceuticals as a way to reduce their medicare bills.
A concession to the EU "would strike a real blow against efforts to reduce costs," said Dix in an interview.
Asking Ottawa for reimbursement is an unworkable proposition, he added, urging premiers to step up their pressure on Ottawa instead.
Provinces are included in some of the free-trade talks, but not the discussions over drug patents, because intellectual property is a sole federal responsibility.
As for the federal government, concessions to the EU on drug patents might pave the way for Ottawa to be invited into the Trans-Pacific Partnership talks.
The TPP is a huge trade negotiation that excludes Canada for the moment, although an invitation could come soon if Ottawa can convince the United States.
Plus, the brand-name pharmaceutical industry, which has substantial production in Canada, argues strenuously that better patent protection is necessary to remain competitive here. The industry argues that health care costs can't — and shouldn't — be controlled by favouring generic drugs over brand names, and contests studies showing higher drug costs from stricter patent protection.
But if the rumour mill is correct and Ottawa does agree to part of the EU's ask on drug patents, the federal government would also be upsetting the delicate balance between brand names and generic production that has been in play for more than two decades.
An Ottawa concession would also provoke the provinces on health care at a time when some premiers are already upset with a unilateral federal decision to scale back increases in health care transfers.
What's In The Ontario Budget 2012
The 2012 Ontario budget freezes pay for doctors, and extends a pay freeze for health care executives. The province will begin means-testing seniors' prescription drugs, paid for under the Ontario Drug Benefit Plan, effectively meaning that the 5 per cent wealthiest seniors covered by the plan will have to pay more into the plan. Seniors with incomes over $100,000 and senior couples with combined incomes above $160,000 will be affected. Increases in health care spending will be capped at 2.1 per cent per year.
The budget freezes pay for teachers. A pay freeze for educational executives, already in place, will be extended. School boards in low-population areas will be amalgamated, and "under-utilized" schools will be shut. Student transportation will be cut by $34 million.
The province will begin means-testing seniors' prescription drugs, paid for under the Ontario Drug Benefit Plan, effectively meaning that the 5 per cent wealthiest seniors covered by the plan will have to pay more into the plan. Seniors with incomes over $100,000 and senior couples with combined incomes above $160,000 will be affected.
Welfare rates will be frozen and planned increases to the Ontario Child Benefit will be delayed.
There are no tax hikes in the 2012 Ontario budget, but it does freeze the corporate tax rate at 11.5 per cent, foregoing planned reductions in the tax rate to 10 per cent. The freeze is expected to save $1.5 billion over three years.
Ontario will cap the 10 per cent hydro bill rebate at 3,000 kilowatt-hours, a limit high enough that most homes won't be affected, but businesses could be. Reducing the tax credit will save $470 million over three years.
Crime & Security
On top of the four jails the province already plans to close, the budget adds two more to the closure list -- one in Brantford and one in Chatham. Overtime for jail guards and the Ontario Provincial Police will be reduced.
Ontario plans to reduce spending on business support programs by $250 million by merging a number of different programs.
Gambling & Lotteries
The province aims to increase revenue by increasing the number of gambling facilities. [Details to come]
Who Was Canada's Best Premier?
Policy Options magazine asked 30 historians, political scientists, economists, journalists and policy advisers from across Canada to pick their top five choices for best provincial premier since 1972. Here are the answers. (CP)
5. Robert Bourassa
Bourassa served as premier of Quebec from 1970 - 1976 and then from 1985 - 1994. (CP)
4. Frank McKenna
McKenna served as premier of New Brunswick from 1987 to 1997. (CP)
3. Allan Blakeney
Blakeney served as premier of Saskatchewan from 1971 - 1982. (CP)
2. William Davis
Davis served as premier of Ontario from 1971 - 1985. (CP)
1. Peter Lougheed
Lougheed served as premier of Alberta from 1971 - 1985.<br><br> The magnitude of support for Lougheed in the survey spanned the country, with first-place votes in all regions Jury members were also asked to rate premiers according to nine questions pertaining to various aspects of leadership, such as vision and communications, fiscal and economic management, intergovernmental relations and other important files. Lougheed's ratings were higher than the others on all questions, and ranged from 4.23 on interprovincial relations to 4.77 on ability to win over voters and elections. (CP)
Jean Charest - 26 per cent approval
Quebec's Liberal Premier is Canada's least popular. (<a href="http://www.angus-reid.com/wp-content/uploads/2011/12/2011.12.19_Premiers_CAN.pdf">Data from Angus Reid Survey</a>)
Dalton McGuinty - 38 per cent approval
Ontario's Liberal Premier is second from bottom on the list of Canadian provincial leaders.
Darrell Dexter - 39 per cent approval
Nova Scotia's NDP Premier is third from the bottom.
Christy Clark - 40 per cent approval
B.C.'s Liberal Premier is near the middle of the pack.
David Alward - 40 per cent approval
New Brunswick's Progressive Conservative Premier is near the middle of the pack.
Greg Selinger - 50 per cent approval
Manitoba's NDP Premier is near the middle of the pack.
Alison Redford - 53 per cent approval
Alberta's Progressive Conservative Premier is third from the top.
Kathy Dunderdale - 60 per cent approval
Newfoundland and Labrador's Progressive Conservative Premier is second from the top.
Brad Wall - 71 per cent approval
Saskatchewan's Saskatchewan Party Premier is Canada's most popular.