Why fragmented demand weakens Canada’s position in the global healthcare market 

The global rules of trade are being rewritten. 

Governments are reconsidering where critical products are made, how domestic industries are supported and which markets they want to rely on. Manufacturers are making equally consequential decisions about where to invest, what capacity to build and which customers to prioritize. 

Canada enters this environment with a simple disadvantage: we are not a large market. 

In pharmaceuticals and medical devices, for example, Canada represents roughly 2 to 3 per cent of the global market.i 

That should make scale more important to us, not less. 

Yet across healthcare, we are moving in the opposite direction - dividing demand across organizations and procurement channels at precisely the moment when our collective purchasing power matters most. 

The Decision Paradox: To Create the Best Offer, We Need to Bring National Demand 

Every organization wants to get the best value and savings before committing to buy from a contract. That is understandable. Healthcare organizations want to compare their options, test the market and make the best decision for their organization. 

But what makes sense for one organization can produce a very different result when everyone does it. 

That is the fundamental tension at the heart of group purchasing: the value of the group depends on the strength of the group. 

Recent research from the University of Alberta reinforces this point. Researchers found that larger GPOs significantly reduce hospital supply expenses without compromising patient care. Measuring GPO scale using national market share, the study found a causal link between greater GPO scale and lower hospital supply expenses.ii 

Now picture a hundred buyers telling a supplier, “Give us your best offer, and then we’ll decide how many of us will actually buy.” 

That is a very different proposition from one hundred buyers saying, “We are ready to buy. Compete for our business.” 

The potential volume may be identical. The value of that volume to the supplier is not. 

With greater certainty, a supplier can make different decisions about pricing, inventory, production, service and investment. 

This is the decision paradox: some want to see the benefit of collective buying before committing to it, but that benefit is strengthened by having guaranteed volume in the first place. 

Buying power comes from real demand, not potential demand. 

If everyone waits for the buying power to appear before contributing their volume, we risk weakening the very advantage we are trying to create. 

Price Matters. So Does Everything Behind It. 

Healthcare procurement is no longer simply about negotiating today's unit price. 

Hospitals and governments are under enormous pressure to contain costs. At the same time, we are asking suppliers to carry inventory, diversify production, strengthen redundancy, invest in Canadian capacity and provide reliable and high-quality supply through increasingly volatile conditions. 

Those expectations have to be reconciled. 

The lowest price today is of little comfort if the product is unavailable tomorrow. But resilience at any price is not sustainable either. 

The objective has to be best sustainable value over time, balancing affordability, quality, service, reliability and security of supply.  Our patients depend on us to deliver this long-term outcome for better healthcare delivery now and for future generations of Canadians. 

Scale helps us negotiate that balance. It can also make Canada a more compelling customer. 

A manufacturer considering whether to enter Canada, invest in additional capacity, carry more inventory or expand domestic production needs to understand the opportunity. A fragmented collection of potential buyers sends a very different market signal than coordinated, predictable demand. 

Aggregation is not simply about buying more for less. It is about making Canada a stronger customer. 

Scale Without Intelligence Isn't Enough 

Fragmentation does not just divide our buying power. It divides our intelligence. 

HealthPRO Canada has decades of healthcare purchasing history, demand patterns, supplier performance and contracting information across the country. Increasingly, we are bringing those datasets together with market intelligence and AI-enabled analytics to understand where prices are moving, where supply is becoming concentrated, where dependencies exist and where alternatives may be available. 

That matters because today's risks are interconnected. 

Tariffs can affect cost. Manufacturing concentration can affect availability. Raw-material dependencies thousands of kilometres away can become a Canadian supply issue. A supplier-performance issue in one part of the country can be an early warning for another. 

Health Canada received 2,588 new drug shortage reports in 2024–25, with manufacturing disruptions accounting for 65 per cent of reported shortages. Medical-device shortage reports increased 19 per cent over the previous year.iii 

The earlier we can see these signals, the more choices we have: alternative sources, diversified supply, product substitutions and different contracting strategies before a problem becomes a crisis. 

Our goal is to turn national data into foresight, and foresight into action. 

But intelligence is most valuable when there is sufficient scale to act on it. 

More Options, Not Fewer 

Coordination does not mean Canada should only turn inward. 

Strengthening Canadian manufacturing capacity is important. HealthPRO is working to identify Canadian manufacturers within our portfolio, help Canadian companies navigate healthcare procurement and create pathways for proven Canadian innovations to scale. 

But Canada cannot, and does not need to, manufacture everything our healthcare system uses. 

We also need strong international relationships and more diverse sources of supply. That is why HealthPRO has been building relationships with European healthcare and procurement organizations and exploring opportunities to diversify supply in concentrated markets. 

Domestic capacity and international diversification are not competing strategies. 

The objective is optionality with strategic insight. 

Build at home where it makes strategic sense. Diversify internationally where it reduces risk. And use our collective demand to make Canada a market suppliers want to serve. 

Don't Make Canada Smaller 

None of this means healthcare organizations should surrender local decision-making. 

Clinical requirements matter. Regional circumstances matter. Competition matters. Choice matters. Effective national procurement should account for those differences, not erase them. At HealthPRO Canada, they are built into how we engage Members, structure procurements and bring collective demand to market. 

The opportunity is to preserve what needs to be local while coordinating where scale creates an advantage. 

We should distinguish between preserving choice and fragmenting leverage. 

Canada is already a relatively small player in a global marketplace that is becoming more competitive, more strategic and, in many cases, more concentrated. 

We should not make ourselves smaller still. 

When we coordinate national demand, we create scale. 

When we coordinate data, we create intelligence. 

When we bring the two together, we create something more valuable: influence. 

Influence to negotiate better value and to demand stronger supplier performance. To support Canadian companies ready to scale and to attract international suppliers. To diversify where we are vulnerable and to compete more effectively for supply when the global market is under pressure. 

The global marketplace is changing whether we are ready or not. Canada will be better positioned to navigate it when we bring our coordinated demand for high-quality healthcare products, data intelligence and national influence together. 

Our strength is not the size of any one organization. It is the size of the market we can create when we act together. 

Christine Donaldson 
President & CEO, HealthPRO Canada