No rhockln, you don't understand it. 

The province will take competing bids and select the (presumably) lowest one. It is called buying in bulk. 

I'm sure the drug companies would prefer your form of "competition" where they get to bribe the individual pharmacist to carry their drug and, of course, build that into their price. 

If that system had been working okay, I'm sure no one would have bothered to replace it. 

p.s. Did you read the part of the article about Canada having the highest prices for generic drugs?