Canada's Government-Dominated Health Care Chokes Access to New Drugs
Price controls and regulatory burdens make the market unattractive for pharmaceutical companies.
Given the cost of caring for an aging population in an era of high-tech but expensive treatments, it's no wonder healthcare reform occupies a lot of space in political conversations. But the devil is in the details, and "reform" means different things to different people. For progressives who see government intervention as the solution to every problem so long as they're in charge, reform involves some variation on Medicare for All, extending existing government programs for retirees and disabled people to everybody. Interestingly, Canada also calls its state-dominated medical system "Medicare," and it has big problems.
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Long Delays for New Drugs
"Canadians wait, on average, more than 65 weeks longer for access to new medicines than Europeans and 90 weeks more than Americans," according to the summary of a recent study by Kristina Acri, chair of the Department of Economics and Business at Colorado College, and Lauren Asaad of Canada's Fraser Institute.
The study, published by Fraser, points out that "of the 194 drugs approved both in Canada and the United States between 2019/20 and 2024/25, the FDA granted approval an average of 636 days earlier (median of 371 days) than Health Canada for drugs subject to standard review. Of the 174 drugs approved in both the EU and Canada between 2019/20 to 2024/25, the EU granted approval earlier by an average of 459 days (median of 211 days) than Canada for drugs subject to standard review."
According to Acri and Asaad, "the majority of this delay is in the submission of new drugs for approval in Canada" for a variety of reasons, a big part of which is "market attractiveness including price controls and formulary requirements, rules on drug pricing, regulatory and administrative burdens, and public and private insurance policies." Drug price controls, in particular, discourage introduction of new medicines because pharmaceutical companies fear returns won't cover their outlays.
"Canada's Patented Medicine Prices Review Board conducts cost-benefit analyses of each new drug introduced in the country. If the PMPRB determines that the cost of a medication is too high, it can order the manufacturer to reduce the price," Pacific Research Institute CEO and former Canadian Sally Pipes wrote for Forbes in 2022. "Thanks to its policies, Canadians lack access to cutting-edge drugs. Of the 290 new medications introduced between 2011 and 2018, just 44% were available to Canadians." By contrast, Americans had access to 89 percent of those drugs.
Acri and Asaad also note that Health Canada's drug approval process is, amazingly, less efficient than that of the notoriously bureaucratic FDA, though more efficient than that of the European Medicines Agency. That regulatory gauntlet contributes to the relative unattractiveness of the Canadian market.
A 90-week delay in approving drugs doesn't have to be the end of the world, nor does access to fewer drugs if decent substitutes are available. The real test is in the consequences of delays and reduced options – and those consequences are unpleasant.
"Within the existing system, Canadians experience worse health outcomes and have access to fewer therapeutic options," add Acri and Asaad. "In addition, Canadians face higher health-care costs as a direct result of the mismanagement and delays in the drug approval processes."
State Intervention Means Limited Access to Care
As it turns out, delayed access to new medicines is only one way the Canadian system rations healthcare through time. As Fraser's Mackenzie Moir and Bacchus Barua reported in 2024, "waiting for treatment has become a defining characteristic of Canadian health care….Specialist physicians surveyed report a median waiting time of 30.0 weeks between referral from a general practitioner and receipt of treatment—longer than the wait of 27.7 weeks reported in 2023. This year's wait time is the longest wait time recorded in this survey's history and is 222% longer than in 1993, when it was just 9.3 weeks."
A 2020 Commonwealth Fund survey found that just 38 percent of Canadian respondents "waited less than 4 weeks for an appointment after they were advised to see or decided to see a specialist" compared to 69 percent of Americans. Sixty-two percent of Canadians "waited less than 4 months for non-emergency or elective surgery after they were advised they needed it" compared to 92 percent of Americans.
Government interference in medicine might reduce monetary costs. But "savings" come at the expense of access to doctors, diagnostics, and medicines. That's true not just in Canada, but elsewhere.
"State health insurance patients are struggling to see their doctors towards the end of every quarter, while privately insured patients get easy access," Germany's government-funded Deutsche Welle reported in 2018 of that country's healthcare woes. "State health insurance companies only reimburse the full cost of certain treatments up to a particular number of patients or a particular monetary value….Once that budget has been exhausted for the quarter, doctors slow down—and sometimes even shut their practices altogether."
Of course, the U.S. has its own problems, hence the never-ending search for various flavors of "reform." As of December 2025, according to Pew Research, two-thirds of Americans "say the federal government has a responsibility to make sure all Americans have health care coverage," though only about one in three want a single government-run program along the lines of "Medicare for All" or Canada's system.
Dump Government Intervention in Favor of Health Freedom
Like his Democratic predecessor, Republican President Donald Trump has emphasized efforts to control healthcare costs, including pressure on pharmaceutical companies to lower drug prices. That's likely to be a crowd-pleaser in the short term, but the Canadian experience suggests it will ultimately mean reduced access to medicines. "The result will be less pharmaceutical innovation and fewer lifesaving drugs," Pipes warned in her Forbes piece about the dangers of introducing drug price controls to the U.S.
Other reforms proposed by the Trump administration are more promising, especially changing prescription requirements so that more drugs are available over the counter. That would reduce barriers to introducing and selling medicines.
Better yet is Sen. Rand Paul's (R–Ky.) "Health Marketplace and Savings Accounts for All Act," which would reduce government in healthcare while expanding individual choice and control over spending. The legislation dramatically raises the annual contribution cap on tax-advantaged Health Savings Accounts, expands what they can pay for, and extends HSA eligibility to everybody. Unfortunately, it appears stalled in Congress.
There are no magic solutions to the problem of high-cost care, only different ways of dealing with expenses. But state intervention just replaces monetary costs with delays and lost opportunities. Freeing people to make their own decisions and spend their own dollars is the way to go.
