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Friday, August 27, 2010

The Actra Fraternal Society reponds to Council's 'Generics' Discussion Paper

This letter from Mr. Robert M. Underwood, President and CEO of the Actra Fraternal Benefit Society responds to our discussion paper, “Generic Drug Pricing and Access in Canada: What are the Implications? We invite you to read our discussion paper and Mr. Underwood’s response, then give us your thoughts on this important issue.

RE: Your letter to Ferne Downey, National President – ACTRA
Actra Fraternal Benefit Society is a not-for-profit Fraternal Benefit Society providing insurance and retirement services to performers and writers (members of the Writers’ Guild and ACTRA). AFBS is owned by our Members and as such, we have a vested interest in providing cost-effective programs, with HealthCare being one of our primary focuses.

We have provided a ‘mandatory generic’ prescription drug program for our members for approximately 14 years, and we provide for brand-name only where there is not generic substitute, or where the physician clearly prescribes ‘no substitution’.

Within our electronic adjudication process, in addition to providing a managed formulary for our Members, we allow for ‘best available price + 10% markup’ and we are somewhat concerned that recent legislation ion Ontario could force retail pharmacy to re-address their markup policy, which could result in increased costs for our Members. 

We are aware of the commitment to a National Pharmaceutical Strategy, and would applaud such a strategy; however this has been a plank within a number of political platforms for a number of years, and execution of the strategy remains a question mark.

Our insurance (including comprehensive HealthCare benefits) is essentially paid for by Members through contract contributions from producers and through additional contributions from Members.

The Society (following our not-for-profit model) returns all operating surplus back to members in the form of insurance subsidy which can range up to 30% of premium cost.

That is to say, any cost containment value which results from the Ontario generic drug pricing initiatives will be passed on to our members and reflected in our program cost for Members.

We appreciate your link to the ‘Generic drug pricing and access in Canada’ report and you are certainly welcome to post our comments on the Health Council website discussion board.


  1. You made a few good points there. I did a search on the topic and almost not got any specific details on other sites, but then great to be here, really, thanks.

    - Lucas

  2. The ACTRA non-profit plan with mandatory generic substitution sounds great, and it would be terrific if the ON gov’t actions result in cost reductions, but it likely won’t amount to much, unfortunately. The problem is that doctors won’t write prescriptions for medications for which there is a direct generic substitution available.

    For example, they will stop writing Lipitor (atorvastatin, available generically) prescriptions, and start writing Crestor (rosuvastatin, not generic yet), which means that generic atorvastatin usage will decline. The reason for this is the power of Brand marketing. To counter this, ACTRA and other plan sponsors need to get together (via Health Plan Payers of Canada, for example) and influence Drs directly so that more cost-effective prescriptions are written.

    We plan sponsors also need to lobby governments, for better protection from high-cost, ineffective Brand drugs, like Germany did recently.

    For more information, or to join Health Plan Payers of Canada (a non-profit organization) contact Hugh Paton at

    - Hugh