Meanwhile, back in the pharma wars

OTTAWA—Never has the need for national pharmacare been more evident than during the current pandemic, as access to medications has become more iffy as a result of lost workplace health insurance during rising unemployment and widespread strains on household finances. In one step toward the creation of a universal drug insurance plan to match up with Canada’s single-payer health care system, the federal government last week announced the details of long-planned changes meant to increase its capacity to manage patented drug prices. Five years in the making, the new guidelines for the Patented Medicine Prices Review Board (PMPRB) are a response to the relatively high prices Canadians pay for prescription drugs as well as profound changes in the pharmaceutical industry in the past 20 years. Patented drug costs in this country are among the highest in the world, eclipsed only by the United States. And Canada is the only western country with a universal, taxpayer-funded medical insurance program without a similar pharmacare plan. Drug spending in Canada has grown to become one of the biggest medical outlays, rising from $2.6-billion in 1985 to $33.7-billion in 2018 (or $909 per person). This upsurge stems in part from the increasing development of specialty drugs such as biologics and rare disease treatments. The number of patented drugs on the market that cost $10,000 annually has more than tripled in the past 15 years. At the same time, about 20 per cent of Canadians, or 7.5 million people, have inadequate or no drug insurance coverage, with many struggling to pay for prescriptions. One reason for this lack of coverage is the expansion of the gig economy, which now accounts for somewhere in the neighbourhood of one-third of all jobs. And the situation has only gotten worse as employees have lost their workplace health insurance during the record unemployment from COVID-19. As part of the effort to address this situation, the federal government is bringing in regulatory reforms aimed at better management of drug prices by the PMPRB. A key change is eliminating the U.S. from the list of comparator countries used by the PMPRB to set prices here in relation to countries that are like Canada economically and have similar consumer price protections. There are also new measures to improve the PMPRB’s ability to judge whether the price of a new drug, especially high-priced specialty medications, reflects its value to patients and the size of its potential market. In his major report last year on the creation of national pharamacare, former Ontario health minister Eric Hoskins said the new PMPRB price controls were essential to sustain a universal, single-payer drug insurance program. Flickr photograph courtesy of Alex Guibord With these reforms, the PMPRB says Canadians are expected to save as much as $5.7-billion on pharmaceuticals over the next 10 years (a period during which Canadians will spend between $18-billion and $22-billion annually on patented medicines). But nothing is happening very quickly. The new guidelines come into effect on Jan. 1, 2021, but any price changes by manufacturers will not be required until a year later. And bringing prices paid in this country in line with those in comparable countries will be a slow process. Officials said it will require 15 to 20 years under the new guidelines to align with median prices of the new PMPRB11 comparator countries (Australia, Belgium, France, Germany, Italy, Japan, the Netherlands, Norway, Spain, Sweden, and the United Kingdom). In his major report last year on the creation of national pharamacare, former Ontario health minister Eric Hoskins said the new PMPRB price controls were essential to sustain a universal, single-payer drug insurance program. But, despite the stature of Canada’s medicare system as one of the country’s proudest accomplishments, the next step, pharmacare, remains elusive after half a century of high-level recommendations. The PMPRB’s recent experience, which saw the new guidelines challenged in court by the pharmaceutical industry, provides a glimpse of the challenge ahead. And the provinces, while looking to Ottawa for leadership and vastly increased health-care funding, are not exactly on board. Ontario Premier Doug Ford, for instance, is against the idea, having partly dismantled the previous Liberals government’s experiment with pharmacare for youth. The federal Liberals said in the recent Throne Speech that the government remains committed to national pharmacare and will work with any provinces “willing to move forward without delay.” But with the possible exception of Newfoundland and newly re-elected B.C. Premier John Horgan, whose party promised to push for national pharmacare, the premiers appear to be either happy with their current provincial drug plans or opposed to Ottawa’s involvement in another area of health care. Les Whittington is a regular columnist for The Hill Times. The Hill Times