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Prohibition on Pharmacy Inducements Beyond College of Pharmacists’ Authority
Professional Regulatory Alert

In Sobeys West Inc v. Alberta College of Pharmacists2016 ABQB 232, the Alberta Court of Queen’s Bench held that amendments to the College of Pharmacists’ Codes of Ethics and Standards of Practice prohibiting inducements to customers for the purchase of drugs and other products and services went beyond the College’s authority under the Health Professions Act (“HPA”).

In April, 2014, the College amended its Code of Ethics, Standards of Practice for Pharmacists and Pharmacy Technicians, and Standards for the Operation of Licensed Pharmacies to prohibit pharmacists or pharmacy technicians from offering inducements to customers. The amendment prohibited the use of customer loyalty schemes, gifts, prizes, rewards and other incentives aimed at inducing a customer to purchase drugs and other products and services from a particular pharmacist or at a particular time. The amendment had been stayed by the Court on an interim basis in June, 2014, prior to the amendment coming into force, until the Court issued this most recent decision.

The Court held that the prohibition on inducements was beyond the authority of the College because the prohibition was inconsistent with the scope and mandate of the HPA. As stated by the Court, “the HPA does not contemplate that the College’s authority or jurisdiction in regulating the practice of the pharmacy profession would extend to the regulation of economic relations or competition among commercial or business entities.”

The Court held that the HPA was intended as a framework to ensure that all health professionals would be competent and accountable to the public. The HPA was not intended to empower Colleges to regulate economic matters. Since the inducement prohibitions, as determined by the Court, amounted to controlling the way commercial entities (pharmacies) operated and competed in terms of prices and costs to consumers, they had a clear and direct economic function and were not related to the practice of the profession or issues of professional conduct and competency of pharmacists. Accordingly, they were held to be inconsistent with the objectives of the HPA and unrelated to the statutory purpose of the HPA. 

The Court also went on to consider, if the prohibition on inducements was related to the purpose and objectives of the HPA, whether the prohibition was a reasonable policy choice. The Court held that even if the prohibition on inducements was related to the purpose and objectives of the HPA, there was insufficient evidence to demonstrate that the prohibition on inducements protected and served the public interest and was therefore a reasonable policy choice.

This decision of the Alberta Court of Queen’s Bench is in contrast to the very similar case of Sobeys West Inc. v. College of Pharmacists of British Columbia, 2016 BCCA 41, a case previously discussed by Field Law. The BC Court of Appeal determined it was reasonable for the BC College of Pharmacists to prohibit pharmacists from using “customer incentive programs” even without any empirical evidence of harm. The Alberta Court does not
discuss the BC Court of Appeal decision.

This decision from the Alberta Court of Queen’s Bench appears to place some limits on the College’s powers under the HPA. Regulators wishing to discuss the impacts of this case on any current or proposed standards of practice, ethical principles or other regulatory requirements are welcome to contact any member of Field Law’s Professional Regulatory Group. We understand that the College of Pharmacists has appealed the decision. Field Law will continue to monitor the proceedings and will report on future guidance provided by the Alberta Court of Appeal on these issues.