In particular, there are a number of public policy factors that affect Canada's ability to attract the investments critical to ongoing pharmaceutical innovation. We put forward recommendations in our submission to address these public policy factors today, and we will focus on four of them.
To put these recommendations into context, I refer you to your graphic on the timelines for the development of an innovative medicine from laboratory to pharmacy. We've also taken the liberty of expanding it on this billboard so we can refer to it when we're talking about some of those issues. On it is the 20-year patent life. As you can see, a good part of that gets used in drug development and then you go through the various regulatory steps to get on to the market and you end up with what we call your period of market, which ranges anywhere from five years up to nine years. So I'll talk to you about some of those regulatory steps.
A fundamental driver of business investment is intellectual property. In this industry it takes approximately 10 years to develop a new medicine and costs an average of about $1 billion. That's a global figure, that's not a Canadian figure. It's a global effort, so it's in total. Intellectual property protection is our primary asset, given the high cost and risk of developing a new medicine or vaccine and the relative low cost and risk of copying it. Our regime needs to remain competitive if we're going to continue to be able to compete internationally for R and D investment.
After approvals and reviews, there's often only a five- to seven-year window in which a medicine can recoup its costs. We are the only G8 country without some form of patent term restoration. This is an instrument in which the time to develop and get a medicine on the market is recouped on the back end; it's added to the end. As well, there are significant incentives to infringe our patents, therefore, we need to be able to effectively enforce them.
We therefore recommend that the government deliver on its throne speech commitment to improve the scope and duration of intellectual property protection in Canada and maintain a stable, reliable, and globally competitive footing.
The Patented Medicine Prices Review Board was established 20 years ago with a mandate to ensure a balance between pricing patented medicines fairly and encouraging innovation and investment. Price increases were not to exceed the consumer price index, and over the past 10 years they have not. CPI has gone up about 2% on average per year, and the price increases of patented medicines have declined about 0.2%. We feel it's evidence that the board is exceeding its mandate.
Our second recommendation is that the government implement an innovation review of the PMPRB to ensure that it does, in practice, adhere to its mandate.
Every aspect of a pharmaceutical's life cycle is subject to intensive company and governmental review and oversight, a process that can and does take years. We accept this; we are, after all, talking about people's health. But inefficiencies and duplication are a disincentive to access to both new medicines and innovation and don't necessarily always enhance patient outcomes. For instance, the common drug review was established in 2003 with the intention of reducing duplication and effort in streamlining the review process among the provinces. However, we found that it is now prolonging and complicating the process, without any direct benefit to patients.
Our third recommendation is that the drug review and reimbursement evaluation process in Canada be evaluated for its competitiveness and should include standards of measures to improve efficiency, eliminate duplication, and strengthen transparency and patient involvement.
Our final recommendation is that there should be a framework in which to implement these recommendations. Global R and D investment is declining. There's greater competition, and we have new markets like India and China. We feel that other countries are implementing comprehensive strategies to look at some of these issues and that Canada needs a similar strategy upon which to look at some of these changes. We therefore would look for the committee's support for a recommendation to the government for a sectoral strategy.
Thank you very much. We look forward to your questions.