Canada should create a new national arm's-length agency to manage prescription medications, including negotiating prices and creating a formulary of approved, covered drugs, says an interim report from the Liberal government's advisory council on the implementation of national pharmacare.

Dr. Eric Hoskins, former Ontario health minister and chair of the advisory council, formally presented the eight-page report on Wednesday morning in Toronto, alongside federal Health Minister Ginette Petitpas Taylor and Finance Minister Bill Morneau.

"The current system of prescription drug coverage in Canada is inadequate, unsustainable and leaves too many Canadians behind," Hoskins said. "Simply maintaining the status quo is not an option."

The interim report findings, he said, are based on "many months" of research and "eye-opening" consultations his seven-member council has held with stakeholders across the country, including patients, employers, organized labour, the insurance sector, pharmacists, governments, Indigenous leaders and academics.

Hoskins said the council, which was formed in June 2018 to advise the federal government on how to implement national pharmacare, has also received more than 150 written submissions and 15,000 online questionnaire responses.

"There's one sort of absolutely consistent point among everyone that we've engaged ... that too many people are falling through the cracks ... when you think of the uninsured and the underinsured," he said.

Canadians are currently covered by a patchwork of public and private drug plans, but an estimated 20 per cent (as many as 7.5 million people) report they pay out of pocket for their prescriptions.

Dr Eric Hoskins, who is leading the federal government's study on pharmacare, says that the main thing they've learned so far is that too many people are unable to afford their medications, and that the current system is inadequate. 1:40

Hoskins also said many Canadians are concerned about coverage for prescription drugs for rare diseases, which are often extremely costly.

Petitpas Taylor said every year more than one million Canadians give up "basic necessities such as food or heat to afford the medication that they so need."

Pharmacare is a "missing piece" in Canada's universal health-care system, Petitpas Taylor said, referring to an idea in which "we ask for your health card and not your credit card" when patients buy drugs.

Morneau also called pharmacare a "critical piece of the Canadian health-care system ... that we know we need to get right for Canadians."

The finance minister said the costs of pharmaceuticals in Canada is "staggering" — pegging the "collective" price paid across the country at $34 billion in 2018.

But the interim report did not provide guidance on how the federal government should ensure that all Canadians have access to prescription drug coverage — notably whether it should adopt a universal, single-payer pharmacare plan, or whether it would simply fill the gaps for those who don't have coverage under other insurance plans.

The council's final report is expected in June.

Morneau also would not say whether pharmacare would figure into his upcoming federal budget on March 19.

There was also no mention in the interim report of how much money would be needed to set up the national drug agency the council is recommending.

That agency "would act as a steward of national pharmacare and provide guidance and advice to governments," the report said.

"Even in the absence of national pharmacare, we discovered that there would be significant benefit to consolidating many of the prescription drug-related functions currently being undertaken at various levels of government and in different entities," it said.

That agency would negotiate prices with drug manufacturers. Advocates for pharmacare have long said that consolidating Canada's buying power would result in better prices.

The development of a national formulary — a list of prescription drugs that would be covered across the country — would be another "key responsibility" of the agency, and medications would be evaluated by experts based on clinical evidence and value for money.

"Special consideration" would be given to drugs for rare diseases, the report said.

A deflection from scandal?

The fact the interim report did not answer some key questions and was released on Wednesday — about an hour before Gerald Butts, Prime Minister Justin Trudeau's former top aide, began his testimony before the House of Commons justice committee to deny allegations he had inappropriately pressured former attorney general Jody Wilson-Raybould in the SNC-Lavalin affair — prompted questions about whether it was presented to deflect media attention from the scandal.

Both ministers, as well as Hoskins, denied that was the case.

"We had planned this news conference a while back," said Petitpas Taylor. "The past few weeks have been difficult, but we also have to recognize that as a party, as a governing party, we must continue to govern in this country."

"Pharmacare is a priority for Canadians," she said.

Hoskins also said the release of the interim report had been planned in advance and that although people were "anxious to see the final report," the recommendations presented in Wednesday's announcement were "important."

Morneau echoed those responses, saying "this is a critically important step" for finding the right approach to pharmacare.