South Korean drug makers have seen several high-profile setbacks in recent months. What does this mean for overseas… https://t.co/HGl2jUJ7qw
Pharmacare for all in Canada: Unlikely proposal to imminent threat
The Canadian government has announced its Budget 2019, that for the first time in the country's history will take steps to establish a Canadian Drug Agency that will be responsible for consolidating all prescription drug regulatory, health technology, and pricing evaluations and decision-making under one roof. This means two things for the pharmaceutical industry:
- The national drug super-agency will hold significant power to manage and oversee pharmaceutical access through a national formulary that will put significant downward pressure on drug prices.
- The government is setting the stage for the establishment on a national prescription drug reimbursement program (dubbed Pharmacare) that could transform the operating environment for the pharmaceutical industry in Canada as we know it.
We still do not know what the proposed Pharmacare program will look like as we await the final report from the Advisory Council on the Implementation of National Pharmacare later this year. Some suggest it will help cover gaps in the existing highly fragmented market, while others argue that based on the proposed CAD3 billion in annual savings the government intends to leverage from establishment of the Canadian Drug Agency over the long-term, the program is likely to function as a universal publicly-funded drug plan.
Canada has long entertained the idea of establishing a national drug reimbursement program to lower prescription drug costs: after all, is it the only developed market with universal healthcare that does not provide national prescription drug coverage.
The problem: High drug prices
Currently, Health Canada carries out all marketing approval evaluations, the main health technology assessment body the Canadian Agency for Drugs and Technologies in Health (CADTH) carries out cost-effectiveness assessments, and the semi-judicial Patented Medicine Prices Review Board (PMPRB) ensures prescription drug prices are kept below a certain cap. In addition, the more recently established pan-Canadian Pharmaceutical Alliance (pCPA) has been carrying out joint negotiations on all products that complete a CADTH HTA assessment. While these agencies and alliances provide some equity across Canada with regards to pharmaceutical drug access, particularly across certain public plans, the pharmaceutical market remains highly fragmented with multiple commercial and public plans operating using different designs and formularies under the discretion of individual jurisdictions. Consequently, Canadians pay some of the highest prices for prescription drugs after the United States, with branded products costing more on average in Canada than other developed markets. Median OECD drug prices were around 20% less than drug prices in Canada, according to the latest PMPRB report using 2017 data.
The solution: Pharmacare
Prime Minister Justin Trudeau's government established an Advisory Council focused on assessing the feasibility of establishing a publicly-funded national prescription drug plan, referred to as Pharmacare, in last year's Budget 2018. The Council released an interim report in March, highlighting three main pre-requisites to launching a Pharmacare program, including the establishment on a national drug agency, a national formulary, as well as increasing investment in data and IT systems to streamline processes across the healthcare continuum. The Advisory Council on Pharmacare will be issuing its final report in the next few months, and this will further outline the exact nature of the proposed Pharmacare program - whether it will be a universal and exhaustive or intended to fill in the gaps within the current framework.
The Canadian Drug Agency Transition Office
According to the Budget 2019, the government will be working with provinces, territories and other partners to outline a vision and mandate for the super-agency under a newly formed Canadian Drug Agency Transition Office, with CAD35 million earmarked to Health Canada over four years starting from 2019 for its development. In addition, the Budget has proposed to invest CAD1 billion over two years starting from 2022 with CAD500 million per year after that, focused on facilitating access to rare diseases by consolidating decision-making regarding access and pricing when it comes to these high-cost orphan drugs.
Is Pharmacare imminent?
If Canada does establish a single-payer system, the pharmaceutical industry will certainly be unfavorably impacted as mounting pressure from a single negotiating entity will drive down prices much like other developed markets with pharmaceutical regulations. The government estimates that the negotiating power of the Canadian Drug Agency could lower prescription drug costs by up to CAD3 billion each year over the long-term. What is the likelihood that Pharmacare will become a reality? Well, the Liberal government is campaigning for re-election on the promise of establishing Pharmacare, and the outcome of the federal elections in October this year will play a big role in determining the fate of this initiative for the immediate future.
- Ten-year Medicare budget impact of increased coverage for anti-obesity intervention
- South Korean pharma dreams struggle
- The economic burden of elevated blood glucose levels in 2017 in the United States
- Taking the pulse of international reference pricing
- Irish green credentials fail on pharmaceutical waste exports
- Canada makes history in basketball and Pharmacare
- Inconsistent application of pricing policies in China contributes to pockets of high prices
- Argentina announces innovative reimbursement deal for Spinraza
Expanding Medicare coverage to both lifestyle interventions and medication could lead to long-term reductions in he… https://t.co/jWE2HoDMGH
The total economic burden associated with elevated blood glucose levels in the United States reached nearly $404 bi… https://t.co/2bnmrXuBRO