(Bloomberg) -- Prime Minister Justin Trudeau’s government has introduced a bill in Parliament that moves Canada closer to a national drug coverage program.

The legislation sets up “foundational principles” for a national drug program. As a first step, the bill establishes that the government will start negotiations with provinces to provide universal, single-payer coverage for a number of contraception and diabetes medications, Health Minister Mark Holland said Thursday at a press conference in Ottawa.

Trudeau’s government must secure agreements with each province to provide the drug coverage. Though the minister was reluctant to provide a cost estimate due to the need for provincial talks, he ultimately told reporters that the federal price tag may be around C$1.5 billion ($1.1 billion), likely starting next year.

The legislation also sets up a new Canadian Drug Agency that will work toward development of a national list of essential drugs that could eventually be covered by the government as well as a national bulk purchasing strategy. It also supports the publication of a pan-Canadian strategy on the appropriate use of prescription medications.

Taking steps toward a national drug program is a condition of the deal Trudeau’s Liberals have with the left-wing New Democratic Party, which sees the NDP support the Liberals in parliamentary votes — in effect, ensuring Trudeau stays in power. The deal is set to expire in June 2025.

“This is historic,” NDP Leader Jagmeet Singh said at a separate news conference. “This is the dream of our party since the conception of our party and we have fought tirelessly.”

Read More: Trudeau’s Deal for Left-Wing Support Signals More Spending Ahead

The Canadian Chamber of Commerce has called the plan for a national drug program “concerning,” saying that a single-payer universal system would be “a complicated and costly solution.” The group pointed to an October report that estimated public sector spending under such a plan would reach C$38.9 billion annually, though there would also be economy-wide savings in total spending on drugs.

Read More: Trudeau’s Deal for Left-Wing Support Signals More Spending Ahead

Most Canadians already have coverage of prescription drugs through employer-sponsored insurance plans. Provinces and territories — which are primarily responsible for health care in Canada — also offer some drug coverage, either based on income or targeting specific vulnerable groups.

Alberta and Quebec have already said they plan to opt out of the program and seek per-capita funding from the federal government to bolster their own drug programs. 

Holland said he spoke with the health ministers of both provinces and left those conversations feeling optimistic, adding that “we can find answers.”

Questions remain about how an expected federal election in 2025 could upend the long-term plan to establish a universal drug coverage program. Pierre Poilievre’s Conservatives are leading in the polls and have pledged to cut back on spending.

(Adds details from news conference.)

©2024 Bloomberg L.P.