OBJECTIVES: International supply chains could favor countries with higher prices when there are production disruptions, leading to more shortages in countries with lower prices. This research aimed to assess whether drug shortages reported by Canadian manufacturers were associated with lower drug prices in Canada than in other countries.

METHODS: Using international drug sales data from IQVIA’s MIDAS database and drug shortage reports from the Drug Shortages Canada website, logistic and linear probability regression models were used to estimate the likelihood of oral solid drugs being reported as in shortage in Canada between 2017 and 2022. Model specifications included drug-level, ingredient-level and company characteristics, year effects, and international price ratio variables to assess associations between the relative price of Canadian drugs and shortages.

RESULTS: N = 31,651 drug-year observations and N = 14,750 shortage reports were included in the analysis. Among the N=13,564 drug-year observations for which international price comparisons were available, N=3,704 (27%) were reported in shortage. Price ratios were not significantly associated with the likelihood of shortages (p=0.087 in the logistic model; p=0.117 in the linear probability model), while therapeutic class, generic status, number of countries with sales, and number of manufacturers were (p<0.000 to p=0.041). In sub-analyses, the absence of a significant association between price ratios and shortages was found to be robust in both the non-patented and the patented market segments.

CONCLUSIONS: There was no significant association between the relative price of medicines and shortages in Canada during the study period, which did not support the hypothesis of lower drug prices increasing the probability of a drug being in shortage.