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Canada needs to be ‘less hostile and more grateful’ to the pharmaceutical industry: Richard Owens explains why

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This episode features Sean Speer in conversation with Macdonald-Laurier Institute senior fellow and innovation policy thinker Richard Owens about his new policy paper, “Reality Check: Dispelling the Myths Around the Benefits of Drug Price Controls.”

You can listen to this episode of Hub Dialogues on Acast, Amazon, Apple, Google, Spotify, or YouTube. A transcript of the episode is available below.

Transcripts of our podcast episodes are not fully edited for grammar or spelling.

SEAN SPEER: Welcome to Hub Dialogues. I’m your host, Sean Speer, editor-at-large at The Hub. I’m honoured to be joined today by Richard Owens, a senior fellow at the Macdonald-Laurier Institute and author of the new policy paper, “Reality check: Dispelling the myths around the benefits of drug price controls.” The paper, which is the second in an ongoing series, challenges a number of myths that underpin Canada’s model of drug approvals and state-mandated pricing, including, for instance, that pharmaceuticals are simply priced too high.

I’m grateful to speak with Richard about this recent paper, the ongoing series, and its ambitious policy recommendations. Richard, thanks for joining us at Hub Dialogues, and congratulations on your recent policy paper.

RICHARD OWENS: Thank you, Sean, and it’s great to be with you.

SEAN SPEER: If it’s okay, I think it’s wise that we start with some basic context for listeners. What is the Patented Medicine Prices Review Board, or PMPRB? How does it work? What’s its role in the overall system of drug approvals, access, and pricing?

RICHARD OWENS: Of course it’s okay. I think it’s important that we do so because the landscape in this policy area is so complex and so replete with acronyms of all flavours and varieties that beginning with a bit of orientation is important. It’s also important to keep in mind that at root we have a fairly simple policy lever that is misapplied. Let’s start with the PMPRB. As you say, the Patented Medicine Prices Review Board is a Canadian federal government agency, which controls wholesale drug prices in Canada—essentially all drug prices in Canada, although some developments have somewhat diminished its importance.

It was created in 1987 in response to Canada’s desire to improve the environment for drug pharmaceutical research in Canada by improving intellectual property protection for pharmaceuticals under the Mulroney government, with Bill C-22 trying to undo some of the horrific damage caused to this sector of the economy by Pierre Trudeau when, after a long period of favourable nationalistic treatment for drug companies by way of compulsory licensing, he took drug patents out of the Patent Act altogether and just left drug companies twisting in the wind.

As the Mulroney government tried to rectify this wrong, it palliated opposition to these reforms. Opposition that was based on fear of higher drug prices, and opposition that came out of a high inflationary environment by creating the PMPRB. It was an ad hoc, extemporaneous kind of policy that was much more proactive than based on any experience with high prices. We’ve been stuck with it ever since. The way in which the PMPRB works is to compare potential or requested drug prices for import into Canada with a basket of countries, an average of prices based across international comparisons, and then it keeps the price at which a drug is launched in Canada below that average.

SEAN SPEER: That’s really helpful context, Richard. As you say, the PMPRB should be understood as something of a political compromise to advance much-needed patent reform in the 1980s. You’ve written extensively about Canada’s system of drug pricing in the past, particularly in the context of the proposed regulations from the current Trudeau government, which would have led to even tighter price controls for drug makers. Yet, in the first paper of this series, you went beyond merely calling for PMPRB reform, which you’ve done in the past, to actually recommending that the agency be dismantled. What has changed since you first started tackling these issues? Why do you think that now is the time to dismantle the PMPRB?

RICHARD OWENS: Yes. I started tackling these issues about four years ago. My first paper was written with Wayne Critchley, who actually used to be a member of the Patented Medicine Prices Review Board. We undertook that analysis in response to new regulations, which had been promoted by the PMPRB and introduced by the government to try to update the PMPRB to make it more effective in the current environment because it was designed in an environment where the pharmaceutical science was very different than it is today, and where bulk purchasing wasn’t really a factor. So it was feeling like it needed an update.

These new regulations are absolutely confiscatory by their own admission, reducing prices in Canada that are already very low by a further 20 percent to 25 percent, and by other’s calculations more in the line of 46 percent to 82 percent. Here we had a bad agency that was going to turn its operations into one that would have been a disaster for the Canadian life sciences industries and for health care in this country. We leaped onto those regulations, but as you looked at them, it’s really hard to avoid the question of why do we have this agency at all? Why are we doing this?

Clearly, doing price controls of drugs as badly as these regulations would have is worse, but price controls are pretty bogus economics, so why do them at all? I actually developed my opposition to the PMPRB overall pretty quickly once I moved on from that first paper. Once you see how serious the economic consequences of this Procrustean method of price controls are, and you see how poorly the PMPRB—in fact by its own admission—is suited to cope with the current market, then I think you’re led in a lock to the conclusion of getting rid of an obsolete policy letter, an obsolete policy agency.

The simplicity of this problem, the problem with price controls, is obfuscated by some of the factors we talked about in response to your first question: the terrible complexity of PMPRB guidelines, the arcane nature of intellectual property protection for drugs, the huge market for pharmaceuticals, the complexity of their operation, chemistry, and so on. Fundamentally, it’s not that complicated. Price controls kill supply. There’s a very flimsy intellectual basis for the PMPRB, and indeed, a flimsy legal and constitutional one too, as it happens. So it wasn’t as big a leap as it seems to go from trying to rein in the excesses of the PMPRB to saying, no, it doesn’t do any good. Let’s just discard it altogether.

SEAN SPEER: Let me ask one more big picture question, Richard, which draws on the first paper in this series before moving to some of the specific myths that you aim to tackle in the second most recent one. One of the typical explanations for the durability of longtime public institutions is a kind of historic complacency, that they’ve been with us for a long time and so ergo they must persist. The PMPRB, as you say, has only been around since the mid-1980s, so it’s not too difficult to imagine a world in which it doesn’t exist. What happened with drug approvals and pricing prior to the PMPRB? How did drug pricing work in the Canadian market?

RICHARD OWENS: Yes, great question. It’s worth noting that not only was this created in 1987, so it’s fairly recent, but it was created in response to anticipated not actual problems. It was a sop to supposition, not a response to empirical data. In fact, we have this speculative agency, which has gone on to reify and impact itself in the body politic and to continue to try to justify its existence as it goes along.

Before it existed, we had exceedingly weak—in fact, eventually almost non-existent—intellectual property protection for pharmaceuticals in Canada. Of course, this dramatically lessened the pricing power of companies trying to import them. A large part of this policy, by the way, was to try to encourage development of the pharmaceutical industry in Canada. The net result actually didn’t lower prices often. The net result was that domestic companies that didn’t supply enough drugs anyway were able to do so at prices that were essentially protected by discouraging imports. There were some perverse effects.

We had a situation in which there were many fewer drugs than there are now and drugs priced over a much smaller range—they were also so-called small molecule drugs, the larger molecule, the biologic drugs, personalized drugs, orphan drugs, and so on, these all come later. The problem of very high-priced drugs is one that’s emerged as pharmaceutical science has developed in leaps and bounds over the past couple of decades, or a couple of scores of years, for a variety of reasons, including, in particular, advances in DNA science.

The other factor, I guess, was that we had a very high inflation environment coming out of the early 1980s, and you had a focus on prices in economic policy. Which we may have to revert to, I guess, given today’s current excesses, but which hasn’t really characterized economic policy now. You had drugs generally being more affordable, you had much weaker intellectual property protections, and you had the government of the day trying to launch into a new project to try to encourage, through intellectual property protections, a more vigorous life sciences industry in Canada. That prospect created the fear that led to the creation of the PMPRB.

SEAN SPEER: That’s a fascinating history, Richard. What I’m hearing from you is that, at this point, it would be difficult to look backward for any indication of how the Canadian market might function independent of something like the PMPRB because the pre-PMPRB conditions, including with respect to intellectual property rights, are quite different from the present.

That kind of uncertainty feeds into some of the myths that you outline in the second paper, which I’d like to take up now. If the PMPRB was dismantled, ostensibly our system of drug price controls would also be eliminated. Your paper argues that this is a good thing. That the myths behind price controls are wrong and unfounded, as you’ve outlined here so far. Why do you think these myths persist? Is it about politics? Is it about bad reasoning? Or is there something else that’s contributed to the durability of our system of drug price controls?

RICHARD OWENS: That’s a fantastic question of political science and psychological import, which you may be better able to answer than I. We’ve always had in Canada it seems this unhealthy and almost vindictive focus on drug prices. Call it a fear of dying because we’re unable to afford a drug. It’s a fear, which I think is partially fed by the circumstances you just so nicely put your finger on, which is that it operates in a completely unrealistic world. We have controlled drug prices in Canada, we have controlled drug prices almost everywhere, virtually everywhere else with the exception of the United States.

It’s impossible to tell how much money the PMPRB saves us, although it alleges it saves us money, because nobody knows what our market price is. It’s an unreal realm in which empirical data are very hard to come by and very hard to compare. I think that public choice theory teaches us that government agencies see the world through distorting lenses and they spread policy justifications, which helps them persist. A lot of opinion leadership in this area has been provided by government, by the PMPRB, and they have their own livelihood in their interests to defend. I’m sure they believe in what they’re doing, although it takes a narrow perspective to do that.

A lot of it comes down perhaps to a deep distrust and misunderstanding and even resentment of the benign powers of free and open markets and the overall systemic benefits of a vigorous drug development and distribution system. Not to mention not wanting to admit that they’ve been wrong all along. I guess, finally, there’s another potentially more insidious motive at work, which is that a lot of drugs in Canada are paid for by government.

They are purchased for younger people in some provinces pursuant to government-mandated drug plans, for older people across the country by our age-specific Pharmacare benefits, and in institutions in large volumes by government acquisition. A lot of it is simply that prices show up on the public ledgers. Politicians and bureaucrats have motives to try to keep them lower at the cost of, unfortunately, patient illness and lives.

SEAN SPEER: That’s fascinating, Richard. The idea that government itself has perverse incentives to keep drug prices low, even if it comes at the expense of domestic innovation, domestic production, et cetera, which is something we’ll come back to later. One of the most pervasive arguments in favour of drug price controls though is that pharmaceutical companies would otherwise gouge customers. Now, it’s quite possible that drug prices would indeed rise in a more market-based environment, but you argue that this isn’t a bad thing. In fact, it would be in everybody’s interests if companies were actually more profitable. Why don’t you help me and the listeners understand this point?

RICHARD OWENS: It’s absolutely true that the more profitable the drug industry becomes, presumably to a certain point, the better off we are because R&D investment is directly linked to revenues and profits. It’s not at all surprising. Because how else are these drug companies going to maintain their revenues and their profits in the future than by discovering new products with R&D investments that are proportional to the revenues they’re trying to sustain.

More R&D translates directly to more drug discoveries, which in turn translates into rather vast welfare gains for all of us, particularly in terms of years of life. It’s been fairly well estimated that a dollar taken out of pharmaceutical research and development results in a net social cost of seven dollars. The leverage that we get in our health-care systems in terms of more productive people, in terms of longer lives, from investment in pharmaceuticals is colossal.

We ignore it at our peril. So we all greatly benefit from these dynamic benefits. Anecdotally, the evidence of price gouging by pharmaceutical companies, whatever price gouging may be in anyone’s mind, actually, it’s pretty rare. Overall, we benefit greatly from the drug development system. As higher prices in Canada in particular will be offset by greater access to drugs. Price controls mean we have many, many fewer drugs in Canada than we would otherwise have—new therapies, more productive people, longer lives, et cetera. Not to mention the economic gains from a vigorous life sciences industry.

It’s also important to remember that it’s not just a system gain or personal cost if prices go up—and by the way it’s not clear how much prices would go up in Canada if we got rid of the PMPRB, depending on the circumstances in which that happened—but many factors limit drug pricing, including competition between therapies, the drug companies, desire to maximize revenues as opposed to single sales profits, and perceptions of the value delivered by a drug.

Essentially, we can trust the market for a reasonably rational distribution outcome, especially for the very limited period of market exclusivity the drugs have, which is just a few years to recover R&D and approval costs that generally come out to the billions of dollars. The risks and costs that these companies undertake to get us our therapies are enormous, and we can’t just shut our eyes and try to make these costs go away. It’s not going to happen.

SEAN SPEER: Your point, Richard, about the opportunity cost of our model is fascinating. It reflects Bastiat’s observation of the seen and the unseen, whereby policymakers and consumers see high prices but what they don’t see is the investment in drugs that remain outside of our country. Even if one accepts the premise that prices would indeed rise as you say, the magnitude of that price increase is hard to predict. There may be certain drugs, especially ones for rare diseases or medical conditions that are priced very high in order for companies to recoup the significant R&D costs.

As you mentioned, though, in those cases, governments could pursue ostensibly different options to help consumers purchase those drugs, including bulk purchasing or consumer subsidies or some other approach. Why do you think price controls have been the default response? What, in other words, has caused policymakers to accept a policy consensus in favour of price controls in this particular area of Canada’s economy?

RICHARD OWENS: [chuckles] Yes. It’s so weird, isn’t it? Everybody knows price controls have terrible side effects. One would have thought the one area where we least want the loss of supply and loss of investment that price controls entail is pharmaceuticals, and yet it persists. It’s explicable perhaps only by government unwillingness to be creative to revise its policies and approaches and to ignore the terrible negative impacts. You can talk to the PMPRB itself about the loss of investment in Canada, about the unavailability of drugs, about shortages of supply, and they’re like the three monkeys. It’s like, “Oh, well, none of that happens.” Which isn’t true, right?

Look, price controls in the context of Pharmacare—and you yourself, Sean, have written about this in a very good article, I remember—in the context of Pharmacare, we’ve looked at the affordability of drugs in Canada. We don’t have an affordability problem. That’s not to say that every single person can always afford the drug he or she needs at any particular moment, but population-wide we’re actually pretty well covered. People make a reasonable living because we’re a wealthy country. Most people, in fact, have coverage under private insurance policies for prescription drugs.

Why bear the costs of reducing prices for everybody when you could have a more targeted subsidy for people who really need it? It’s an absurdly clumsy and overbroad policy. It’s also just cheap, I guess. I mean by reducing drug prices for everybody, government avoids having to pay full price for the people who need it. But obviously, on a broad scale, that’s going to work out to forcing suppliers to subsidize their own products which is what price controls do. It’s an absurd idea.

Now, you’re right to point to orphan and personalized drug therapies, new biologics as well, because many of these are considerably more expensive. We’re not talking aspirin here. Some of these are tens, hundreds, thousands of dollars a year or for a single treatment. We’re looking at fairly big ticket items. The response in government has been to say, “Oh, well, we can’t pay that, so we’ll reduce the prices by 84 percent.” Well, that’s not going to work, right?

It’s an interesting point where pharmaceutical science has brought the policy of price controls to the brink of incoherence as a policy response. We’re going to have to work a way through the problem of how to pay for these really expensive drugs. Should they be paid by the public, when and why, should there be a copay, how much, for which drugs? They’re difficult problems, but they’re not going to be resolved, they’re only going to be compounded by a price control system. They’re harder to deal with in a Canadian environment where we have socialized health care and the presumption of, well, the best cure available and what anybody needs at any time is what they’re going to get.

Of course, our system doesn’t actually work that way. It rations care in all sorts of ways, and it’s not clear that everybody is going to get a potentially multi-million dollar gene therapy paid for by the public purse. But what is absolutely crystal clear is that we cannot have a system that operates to save itself money at the cost of giving people no choices about saving their own lives.

It is absolutely better if a drug, even at a cost of maybe $250,000, is available for purchase even without coverage or public subsidy, than if it isn’t available at all. We can’t let people die on a hill of reserving price controls. Look, markets develop over time. New drugs introduced at great prices, at very high prices, will find production efficiencies, will find economies of scale as they are rolled out. Prices will come down. Financing plans will develop. Charities will develop to make drugs available to those in need.

It is the problem in microcosm: we can’t leave the lives of Canadians wholly at the mercy of bureaucratic rigidity and fears of innovation and potential costs with respect to these drugs. It’s no different than what we’re doing with price controls now. It’s just that, as you so nicely refer to Bastiat, people don’t see the unavailability and problems with our current system. It’s going to be a little more acute when someone’s child with cystic fibrosis can’t get the life-saving drug and dies because of the reluctance of the Canadian bureaucracy to let drug prices rise to their normal level. It’ll be interesting to see what happens.

SEAN SPEER: Yes, that’s well said, Richard. These types of policies are often enacted in the name of compassion and equity. What’s interesting is when you talk to families touched by rare diseases, oftentimes they’re in favour of eliminating price controls precisely because they stand in the way of accessing drugs that they think can help them or their family. In that sense, harming access through price controls seems uncompassionate.

We’ve been talking so far, Richard, about some of the different factors that have contributed to the durability of our current model and the political consensus that has seemingly built up around it. One of the arguments in the paper is that Canada and others are free riders on America’s model of drug development, which rewards firms that come up with major pharmacological developments through its patent and profit model. Why don’t you elaborate on this? How has the American model effectively created something of a moral hazard for Canadian policymakers?

RICHARD OWENS: Yes, thanks. That’s one of my favourite observations in the paper. I will just quickly add, though, in relation to the point you just made. Many patient advocacy groups were vigorously opposed to the new regulations when they came out, so much so that the PMPRB tried to exclude them from comment on the new regulations and developed a communications plan to try to taint their testimony. They understand the problem because they’ve got lives at stake. Back to the Americans. It’s not, of course, just an American system. The system of drug development is completely reliant on vast sums of capital, enormous amounts of expertise, and a lot of time.

All of that is enabled by intellectual property. There really isn’t another or better way to do it, frankly. The Americans are different than everybody else, it seems, at least to the extent of my research, in they understand that they have the benefits of overwhelmingly the largest and most productive pharmaceutical sector in the world. They alone bear the costs. Trade regulation just doesn’t work very well at protecting producers, unfortunately. We have a situation in which Canada and many other countries happily take the drugs that are available from the United States, those that are willing to be sold here and in other countries at lower prices, and many aren’t so we don’t get them.

We’re not willing to bear a reasonable share of the cost of developing those drugs. What happens is that patented drugs in the United States are three and a half times the price on average than they are in Canada. Why is that? Well, I would say it’s because drug companies absolutely need revenues in order to be able to continue to operate, to continue to bear the enormous compliance costs and risks that society foists on them, and to continue to be able to develop new drugs. They can’t get them anywhere other than from the United States.

The back of the poor U.S. consumer is breaking under the sustained weight of bearing virtually all the R&D cost of new pharmaceuticals. Canada takes what it can on the cheap, reducing drug prices so enormously and essentially importing a consumer surplus, a subsidy from the ailing American consumer, into Canada with every drug purchase. Unfortunately and unsurprisingly, the U.S. consumer is getting a little restive with this situation. Now we first had the Trump administration trying to figure out what to do with drug prices and doing it a bit inventively, but I think ultimately ham-fistedly.

One of the things they tried was to allow greater reimportation from Canada, essentially, if you will, outsourcing drug price controls to another jurisdiction, which is wacky and would have resulted, of course, in the destruction of the Canadian drug supply. We’re still, you’ve now got Democrats in the United States putting forward proposals for price controls in the U.S. similar to those in Canada. That’s going to slaughter the pharmaceutical golden goose because, suddenly, there won’t be anybody left to pay. Everybody will want to live in this fantasy world of things should cost less than they actually do. It’s entirely the wrong approach for the U.S. although it’s an expedient one.

What they should be doing is forcing Canada and others to raise our prices, to bear our fair share of drug development costs. We’re a wealthy country. We can’t afford to pay our share. We would benefit greatly from health-care investment, life sciences, industry investment, in this country if we had a better set of rules and better prices. That’s the only way we’re ever going to have, I think, a sustainable worldwide market for pharmaceuticals. I’ve called on Canada to take the lead in trying to unwind this death spiral of drug price controls worldwide. I don’t hold that much hope that we’ll do it, but it is what desperately needs to be done.

SEAN SPEER: I just have a couple of final questions for you, but on this point, Richard, it is conventional wisdom in Ottawa and elsewhere that when it comes to defence spending, Canada is something of a free rider. People know, for instance, that we spend far below the NATO target of two percent of GDP, yet there isn’t the same recognition that we’re a free rider when it comes to drug development globally. Hopefully, your paper helps to shape a better understanding amongst policymakers on this point.

The COVID-19 experience has drawn attention to our lack of domestic drug development and production capacity. There’s now talk of reshoring and friend-shoring and all the rest when it comes to ensuring that we have adequate productive capacity in so called strategic areas, including when it comes to pharmaceuticals. A two-part question: what role has the PMPRB and government regulation played in contributing to our current drug development and production capacity status? Secondly, what should policymakers be doing in order to cultivate more drug development capacity within the country?

RICHARD OWENS: Yes, it’s really interesting. As I mentioned earlier, the PMPRB retails the notion that it has no impact on drug availability in Canada, nor investment here. Stances which are plainly contradicted by the data. As soon as COVID hit, the government quickly enacted exemptions from PMPRB controls for COVID vaccines and COVID therapies. Obviously, even the government which otherwise drinks the PMPRB koolaid doesn’t really believe it’s propaganda on these points. I think the existence of price controls—the threat over the last four years of going from severe price controls to absolutely draconian price controls and the myths and slanders of the pharmaceutical industry that sustain these price controls—these have created a very hostile environment in Canada for life sciences and industries. We have appallingly low investment levels in R&D, by some measures ranked about 32nd in the world in life sciences. By the way, across the economy we have terrible innovation and investment levels and we have no goodwill in international supply chains. Reshoring is a broader international problem. We actually have a terrible risk in that, for instance, 96 percent of the ingredients to antibiotics come from China. Virtually all pharmaceutical ingredients come from China.

When your biggest potential enemy has the only cures for the biological weapons it’s producing, that’s a strategic issue. It’s not Canada’s strategic issue per se, but because Canada can’t solve these problems on its own and it can’t provide the range of vaccines or other pharmaceuticals or therapies that our small population is going to need on its own. This is why it’s so important not only to maintain domestic investment but to share equally with other nations in investment, in regulation, in intellectual property standards that sustain a life sciences ecosystem so that when disaster strikes you have a multi-party response and set of distributed facilities that can be relied on. We are a very long way from doing that.

Now, the problems that we’ve got, they’re a direct result of price controls and in particular the recent guidelines which destroyed the last shreds of confidence in this country. Now they’ve been largely withdrawn, we don’t know whether they will be reintroduced in a new form or not, not because people thought they were a bad idea which they obviously were, but because like the PMPRP itself, by the way, they’re plainly unconstitutional.

Every survey pharmaceutical executives said that they were going to import fewer drugs and cut back investment here as a result of them and we just ignored them. What should we do to change this? This gets to some of the other work I’ve done, not just on life sciences, but on innovation, which is actually a beat I’ve been trading a bit longer than life sciences. I think the first thing we should do in Canada is stop everything we are doing with respect to innovation in life sciences and otherwise, not only getting rid of price controls but all the other counterproductive policies this disruptive government happily calls innovation and that are really anti-innovation. The politically motivated subsidies, the complex tax credit, super-clusters, strategic innovations, fund industrial policy, weak intellectual property protections, grossly excessive government expenditures. We’ve got a lot of cleaning up to do if we’re going to realize the promise of this country. That’s what’s so sad. Its government is defeating our ability to grow wealthy and healthy from the tremendous expertise and motivation that our population has.

We’ve got to drop the hostility to life sciences industry. We’ve got to improve intellectual property protection on which we’ve always been a terrible, laggard. Cut taxes. In life sciences, in particular, start accepting peer agency drug reviews as a qualification for marketing in this country. Getting things to market faster for the benefit of ailing citizens rather than having it held up for months or years in Health Canada. These are a few of the measures we could take and I think we’d find that we could unleash economic activity surprisingly quickly.

Israel is a beautiful example of a country that said, “Why don’t we have life sciences investment?” Asked the question, listened to the answers, implemented them, boom, it’s a miracle how life sciences investment there has soared. Why can’t we do the same?

SEAN SPEER: Let me ask a final question. Why don’t you paint a picture for listeners about what that miracle might look like? In other words, what would be the broad base benefits of a larger and more innovative life sciences sector in Canada?

RICHARD OWENS: Thank you. That’s a nice note to finish on. It’s important because it’s a way of looking at things that means taking one’s eyes off the invoice—”here’s your bill for drug purchases this month, Canada’s government. It’s X billions of dollars”—and looking not at those narrow accounts but looking at the whole national economy. Let’s take health care. The costs paid for drugs may go up, but the costs for amount of hospitalization, the lost lives and productivity of patients, these go down dramatically.

If you look at how to fund hospitals and concentrate only on individual line items, you’re losing track of the important part of the picture, which isn’t how to manage a hospital budget, it’s how to have a productive, happy, wealthier country. More life sciences investment would give us a more productive industry, and would result in, depending on the amount of actual revenues that are created, potentially a great many more new pharmaceuticals which will benefit not only Canadians but the world. Which would generate revenue and tax revenue to fund our health care and other benefits.

Which would create a great many jobs here and improve our research base, creating funding for educational institutions. It would be a great source of growth in the country and improve our income levels as well as our health outcomes. I guess one other thing I’d say is it would help us to see the benefits of a broader vision of success and investment for Canada as opposed to the narrow and rather mean focus on prices. What drug companies do, and I’m not suggesting they’re better than any other industry in some way or holier than thou, but what they do is absolutely miraculous. If you look at some of these new therapies, even COVID vaccines, the technologies are unbelievable, and yet they commercialize them and produce them at great scale.

The benefits from that are enormous and we should appreciate what they can do for us and be a little less penny-pinching about funding those great benefits and rewarding those who provide them to us. And in particular, taking the fruits of the myths they identify, taking the pejorative views of pharmaceutical companies out of our body politick and becoming more grateful and less hostile.

SEAN SPEER: That’s a great way to wrap up, Richard. I was reminded of that sense of wonder and gratitude a few years ago when a friend told me that his niece, not yet born, underwent in-utero surgery to correct for some health challenges that she was having. Just think about what an extraordinary miracle something like that is. It’s a conversation that goes underappreciated in Ottawa and elsewhere, and so I’m glad to have it here.

I would encourage listeners to read Richard’s most recent paper, “Reality check: Dispelling the myths around the benefits of drug price controls.” Richard Owens, senior fellow at the Macdonald-Laurier Institute, thank you so much for joining us today at Hub Dialogues to share your insights and analysis about the PMPRB and Canada’s life sciences sector more generally.