Manulife to cover specialty drugs at any pharmacy after backlash over Loblaw deal

TORONTO — Manulife Financial Corp. says patients who require specialty drugs will be able to fill their prescriptions at any pharmacy after backlash sparked by the insurance provider signing an exclusive arrangement with Loblaw Cos. Ltd.

The insurance provider had told patients last month its specialty drug program would transition to being carried out “primarily” through Shoppers Drug Mart and other Loblaw-owned pharmacies. Manulife had previously also covered specialty drugs through national home and community health-care provider Bayshore HealthCare.

“We have listened to and are addressing the concerns we have heard over the past week,” said Manulife Canada chief executive Naveed Irshad in a statement on Monday.

“Though this change impacts only a small number of our members, it helps ensure that all Canadians we support have choice, access, and flexibility in managing their health. We are proud to partner with thousands of pharmacies across the country and contribute to a strong and healthy Canadian healthcare system.”

Manulife’s specialty drug program affects around 260 medications meant to treat complex, chronic or life-threatening conditions such as rheumatoid arthritis, Crohn’s, multiple sclerosis, pulmonary arterial hypertension, cancer, osteoporosis and hepatitis C.

Patients covered under the program represent less than one per cent of all those insured through Manulife, the company said, adding that “across the rest of our business, we have always offered Canadians the option to choose their pharmacy.”

Deals that provide exclusivity for a particular pharmacy to distribute drugs under an insurance plan are known as preferred pharmacy network arrangements. Researchers have said those arrangements are common in the U.S. and growing in Canada.

Manulife had previously said the shift to an exclusive agreement would give patients “more options” to receive their specialty medications, with patients able to pick up drugs from a Loblaw-owned pharmacy or have them delivered to their home.

Loblaw spokeswoman Catherine Thomas said in a statement that Shoppers Drug Mart pharmacies “will continue to support patients, providing a holistic approach to care for Canadians living with some of the most complex diseases.”

“As we’ve said all along, our goal is to ensure patients have convenient access to care, and we believe strongly in choice,” she said.

Some had expressed worry that specialty drugs could become less accessible to those in rural or remote regions who don’t live near a Shoppers Drug Mart as a result of the previously announced deal.

Marc-André Gagnon, a professor at Carleton University who focuses on social, health and pharmaceutical policy, said he was surprised by the level of attention the deal received.

“Normally, this kind of stuff is always under the radar and basically nobody’s asking questions about this,” he said.

“I’m not surprised that with media coverage, the insurance company changed its decision because they were looking very bad in doing something like this.”

In an update posted to its website, Manulife said it’s implementing the change “swiftly.”

Gagnon said that although Manulife reversed course, the issue isn’t going away. He noted Quebec remains the only province in Canada where there are restrictions that prevent insurance providers from entering into preferred pharmacy network arrangements.

“It’s not a one-time event, bad decision by a private drug plan,” he said.

“You have structural issues and private drug plans will try to solve these structural issues in a way that will be satisfying for their shareholders to the expense of insurees.”

Industry Minister François-Philippe Champagne said last week he was concerned about the deal between Manulife and Loblaw, who “don’t get the message” about the need for increased competition.

“I am glad to see that Manulife listened to Canadians’ concerns,” he said in a statement on Monday.

“This is a step in the right direction.”

NDP MPs Don Davies and Brian Masse had also penned a letter to Competition Commissioner Matthew Boswell requesting the Competition Bureau launch an investigation into the deal based on reporting by The Canadian Press.

This report by The Canadian Press was first published Feb. 5, 2024.

Companies in this story: (TSX:MFC, TSX:L)

Sammy Hudes, The Canadian Press