Table of Contents
Canada's pharmaceutical sector
The pharmaceutical sector is one of the most innovative industries in Canada. It is composed of companies developing and manufacturing innovative medicines and generic pharmaceuticals, as well as over–the-counter drug products. The sector is made up of a number of sub-sectors that service different market segments. These include brand-name pharmaceuticals, generic pharmaceuticals, biopharmaceutical small and medium sized enterprises (biopharmaceutical SMEs), contract research organizations (CROs), and contract manufacturing organizations (CMOs).
Size and structure of the industry
- Pharmaceutical sales in Canada have a 2.2% share of the global market, making Canada the 8th largest world market. Since 2017, compound annual growth has remained positive at 6.4% (IQVIA Pharmafocus 2027).
- Companies undertake research and development (R&D) to develop new or improved patented therapies, while others develop bio-equivalent copies of innovative drugs once patents expire. Emerging fields of biopharmaceuticals include gene and cell therapies, and nanomedicines.
- Brand-name products account for 80.5% of Canadian sales by value and 25.7% of prescriptions by quantity. Generics account for 19.5% of market sales by value and 74.3% of the market share by prescriptions (IQVIA Pharmafocus 2027).
- In 2022, the manufacturing portion of the sector employed an average of approximately 33,000 people and over the last 5 years, employment has grown by approximately 11% (Statistics Canada; Table 14-10-0201-01).
- The industry is clustered mainly in the metropolitan areas of Toronto, Montreal and Vancouver.
Yearly Employment in Manufacturing Portion of Pharmaceutical Sector from 2013-2022
Year |
Employment |
2013 |
26,983 |
2014 |
25,934 |
2015 |
27,302 |
2016 |
28,494 |
2017 |
29,870 |
2018 |
29,804 |
2019 |
30,853 |
2020 |
31,531 |
2021 |
32,513 |
2022 |
33,128 |
Source: Statistics Canada. Table 14-10-0201-01 Employment by industry, monthly, unadjusted for seasonality, Yearly employment is 12 month average. |
Canadian drug sales
According to the 2021 PMPRB Annual ReportFootnote 1, from 2012 to 2021, the value of total pharmaceutical sales (including non-patented and over the counter medicines) in Canada have increased by 56.4% to $34.1 billion. Sales of medicine are handled via different channels with 56.8% being sold through consolidated distributers, 35.5% sold through self-distributing pharmacy chains, and 7.7% being sold directly to pharmacies (IQVIA Pharmafocus 2027).
Canadian Manufacturer's Sales of Patented Drugs from 2013-2021 (Sales in $ billions)
Year |
Patented Medicine Sales |
Non-Patented Medicine Sales |
Total Sales |
Patented Medicine sales per GDP (%) |
2012 |
12.9 |
8.9 |
21.8 |
0.708 |
2013 |
13.4 |
8.7 |
22.1 |
0.706 |
2014 |
13.8 |
9.2 |
23 |
0.696 |
2015 |
15.1 |
9.4 |
24.5 |
0.76 |
2016 |
15.6 |
10 |
25.5 |
0.77 |
2017 |
16.8 |
10.2 |
27 |
0.783 |
2018 |
16.7 |
11.6 |
28.3 |
0.751 |
2019 |
17.2 |
12.6 |
29.9 |
0.748 |
2020 |
17.7 |
14.5 |
32.2 |
0.801 |
2021 |
17.4 |
16.7 |
34.1 |
0.758 |
Source: 2021 PMPRB Annual Report |
R&D activities
- Total business expenditures on R&D by Canadian pharmaceutical companies selling patented medicines were reported to be $922.9 million and have decreased by 1% from 2012 to 2021 (2021 PMPRB Annual Report).
- New medicines and drug candidates are increasingly being developed externally via partnerships with academia, small and medium sized enterprises (SMEs), government and research centres as well as contract research organizations (CROs).
- Drug research and development is increasingly done via external partners, as over the past decade, 60% of innovator small molecules and 82% of innovator biologics have their roots outside of big pharmaceutical companies (source: Accenture). As a result, the innovation activities of large pharmaceutical firms have diversified, and Canadian CROs perform an increasingly important share of R&D.
- According to Research InfosourceFootnote 3, thirty-one pharmaceutical and biotechnology companies are listed in the Top 100 Corporate R&D Spenders 2021 in Canada.
- R&D costs per drug averaged US$1.4 billion over 12–13 years (Tufts Center for the Study of Drug Development). Full costing (including amortization of research failures and opportunity cost of capital) raised average costs significantly. A generic drug may take 2 to 3 years and requires $3 to $10 million of R&D to develop and prove equivalency with the original drug.
Total Canadian Pharmaceutical Business R&D Expenditure (2013 – 2021)Footnote 2
Year |
Expenditure (in $ millions) |
2012 |
936.1 |
2013 |
798.3 |
2014 |
792.2 |
2015 |
869.1 |
2016 |
918.2 |
2017 |
871.4 |
2018 |
892.6 |
2019 |
893.2 |
2020 |
822.9 |
2021 |
922.9 |
Source: 2021 PMPRB Annual Report |
2021 Distribution of Canadian Business R&D Expenditures By Region
Region |
R&D Distribution (%) |
Ontario |
52.3 |
Quebec |
26.3 |
West |
19.9 |
Atlantic |
21.5 |
Territories |
0 |
Source: 2021 PMPRB Annual Report |
International trade
- From 2018 to 2022, pharmaceutical exports and imports between Canada and the rest of the world increased by 38% and 55% respectively.
- The United States is Canada's main trading partner, accounting for 64% of exports and 29% of imports in 2020. Another 48%of imports originate from the European Union.
Total Canadian Pharmaceutical Trade from 2013-2022 (in $ billions)
Year |
Domestic Exports |
Imports |
Trade Deficit |
2013 |
6.1 |
13.7 |
7.7 |
2014 |
8.3 |
15.4 |
7.1 |
2015 |
10.5 |
16.9 |
6.4 |
2016 |
11.8 |
17.2 |
5.5 |
2017 |
8.9 |
17.6 |
8.7 |
2018 |
10.25 |
19.5 |
8.5 |
2019 |
11.23 |
21.5 |
9.4 |
2020 |
11.67 |
22.6 |
10.3 |
2021 |
10.71 |
26.63 |
13.4 |
2022 |
12.79 |
30.21 |
15.03 |
Source: Statistics Canada, Industry Canada Trade data online |
Leading companies
- In 2022, the top ten pharmaceutical companies accounted for over half of total Canadian pharmaceutical sales including both prescription and non-prescription medicines (IQVIA Pharmafocus 2027).
Leading Pharmaceutical Companies in Canada in 2022
Rank |
Leading Companies |
Total Sales
($ billions) |
Market Share (%) |
1 |
Johnson & Johnson |
4.73 |
12.2 |
2 |
Merck |
1.77 |
4.6 |
3 |
Novartis |
1.75 |
4.5 |
4 |
AbbVie |
1.71 |
4.4 |
5 |
Novo Nordisk |
1.62 |
4.2 |
6 |
AstraZeneca |
1.48 |
3.8 |
7 |
Pfizer |
1.46 |
3.8 |
8 |
Bayer |
1.36 |
3.5 |
8 |
Apotex |
1.35 |
3.5 |
10 |
GlaxoSmithKline |
1.31 |
3.4 |
Source: IQVIA Pharmafocus 2027 |
Leading products
- The top ten pharmaceutical products sold in Canada account for 65% of 2022 industry sales for the top 20 brands. Leading therapeutic categories include medicines for glycemic control, arthritis, ophthalmology and autoimmune diseases (IQVIA Pharmafocus 2027)
Leading pharmaceutical products in Canada in 2022
Rank |
Leading products |
Therapeutic subclass |
Total sales ($ millions) |
2022 Growth (%) |
Company |
1 |
Ozempic |
Glycemic Control |
1,044 |
84 |
Novo Nordisk |
2 |
Remicade |
Anti-arthritic |
920 |
-17.9 |
Janssen |
3 |
Stelara |
Autoimmune |
821 |
19.5 |
Janssen |
4 |
Eylea |
Opthamology |
706 |
5.2 |
Bayer |
5 |
Keytruda |
Autoimmune |
621 |
16.9 |
Merck |
6 |
Humira |
Anti-arthritic |
585 |
-36.9 |
AbbVie |
7 |
Jardiance |
SGLT-2 Inhibitors |
398 |
22.5 |
Boehringer Ingelheim |
8 |
Imvruvica |
Autoimmune |
376 |
-5 |
Janssen |
9 |
Vyvanse |
ADHD |
375 |
28.1 |
Takeda |
10 |
Eliquis |
Blood thinner |
358 |
-16.3 |
Bristol Myers Squibb |
Source: IQVIA Pharmafocus 2027 |
Health expenditures on drugs
According to the Canadian Institute for Health Information's National Health Expenditure ReportFootnote 4:
- In 2022, 52% of total health expenditures were directed to hospitals (25%), physicians (13%) and drugs (14%).
- Pharmaceuticals are the second largest component of health care expenditures, representing approximately 14% of total expenditures.
Canada's Health Expenditure from 2016 – 2022 (in $ billions)
Year |
Total Health Expenditures ($billion) |
Growth Rate (%) |
Share of Total GDP (%) |
2016 |
238 |
4.1 |
11.7 |
2017 |
248 |
4.2 |
11.6 |
2018 |
258 |
3.9 |
11.5 |
2019 |
269 |
4.6 |
11.7 |
2020 |
305 |
13.2 |
13.8 |
2021f |
328 |
7.6 |
13.2 |
2022f |
331 |
0.8 |
12.2 |
Source: Canadian Institute of Health Information (CIHI); f=forecasted |