 2006-National Pharmaceutical Strategy.pdf
HIGHLIGHTS - NATIONAL PHARMACEUTICALS STRATEGY PROGRESS REPORT
FEDERAL/PROVINCIAL /TERRITORIAL MINISTERIAL TASK FORCE JUNE 2006
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First Ministers directed Health Ministers to establish a Ministerial Task Force to develop and implement the National Pharmaceuticals Strategy and report on progress by June 30, 2006. The strategy will include the following (Nine Elements of NPS) actions:
- Develop, assess and cost options for catastrophic pharmaceutical coverage;
- Establish a common National Drug Formulary for participating jurisdictions based on safety and cost effectiveness;
- Accelerate access to breakthrough drugs for unmet health needs through improvements to the drug approval process;
- Strengthen evaluation of real-world drug safety and effectiveness;
- Pursue purchasing strategies to obtain best prices for Canadians for drugs and vaccines;
- Enhance action to influence the prescribing behaviour of health care professionals so that drugs are used only when needed and the right drug is used for the right problem;
- Broaden the practice of e-prescribing through accelerated development and deployment of the Electronic Health Record;
- Accelerate access to non-patented drugs and achieve international parity on prices of non-patented drugs; and
- Enhance analysis of cost drivers and cost-effectiveness, including best practices in drug plan policies.
[It is understood that Quebec will maintain its own pharmacare program.]
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The NPS Approach
In the context of equitable access to safe, effective and appropriately prescribed and used drugs and system sustainability, First Ministers laid out nine elements for the NPS in the 2004 10-Year Plan to Strengthen Health Care. While recognizing that substantive, long-term improvement in pharmaceuticals management is contingent on advancing all elements of the NPS, in order to facilitate timely and concrete results for Canadians, the MTF identified five areas for short-to-medium term focus:
i. Catastrophic drug coverage;
ii. Expensive drugs for rare diseases;
iii. Common national formulary;
iv. Pricing and purchasing strategies; and
v. Real world drug safety and effectiveness
The MTF is working to develop and implement practical solutions in each of these areas in a manner that recognizes the interplay of forces, considers the perspectives of diverse stakeholders and addresses the issues in a comprehensive and integrated manner. A snapshot of progress featuring summaries of key achievements in each of the five NPS priority areas is provided below along with recommendations and planned actions for moving forward.
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Snapshot of Progress and Recommendations
Catastrophic Drug Coverage
Catastrophic Drug Coverage (CDC) aims to address the issue of undue financial hardship faced by Canadians in gaining access to required drug therapies, regardless of where they live and work. A 2002 study estimated that two per cent of Canadians have neither public nor private drug coverage, even for catastrophic levels of drug expenses. As well, earlier research suggested that up to 20 per cent of Canadians were under-insured for catastrophic levels of drug expenses. In this first phase of the NPS, work on CDC was directed toward defining ‘catastrophic’ and identifying the general level of drug coverage necessary to protect Canadian families from undue financial hardship. The following principles were established and agreed to as a guide for the development and assessment of CDC options:
1. Universality: all Canadians are eligible
2. Equity: comparable coverage across the country
3. Transparency: coverage levels are easy to understand and access
4. Evidence-based: eligible drug selection based on best evidence
5. Integrated: catastrophic protection is integrated with other public and private drug plans
6. Sustainable: affordable, sustainable, and balanced with other health care priorities
In developing CDC options, the MTF considered how best to protect Canadian families from unaffordable drug expenses, i.e., high drug costs relative to income. This could be done through either a variable percentage of income threshold (i.e., a threshold that is lower at lower income levels and rises as income increases), or a fixed percentage of income threshold (i.e., a threshold that is a fixed percentage for all families regardless of income level). Further work will focus on the variable option as it could more effectively protect lower income families.
RECOMMENDATIONS
The Ministerial Task Force recommends that:
- Further policy, design, and costing analysis be focused on the variable percentage of income threshold option that maintains a private payer role;
- A parallel fixed percentage (5 per cent) option also be analyzed and costed; and,
- The impact and feasibility of maintaining a private payer coverage role be analyzed as part of this further work.
Expensive Drugs for Rare Diseases.
Drugs for rare diseases benefit only a small number of patients and can be prohibitively expensive. Further, with advances in technology, both the number of treatments available and the number of treatable patients are increasing.
Canada is not alone in facing the issue of expensive drugs for rare diseases (EDRDs). Many other countries are also faced with the challenge of how to address these drugs within public health care systems. In exploring this issue, the MTF undertook research and consulted on how EDRDs are defined, evaluated, funded, priced and regulated internationally. International practice and recent Canadian experience underscore the value for Canadian jurisdictions of a structured and coordinated approach to rare diseases.
Common National Formulary
Despite efforts by FPT governments to provide appropriate access to medications outside hospital settings, there is inconsistency and inequity in prescription drug coverage for Canadians cross the country. A national approach to formulary management would promote optimal use of drugs; reduce inequities across FPT plans; achieve administrative efficiencies; and support consistent and evidence-based decision-making.
The benefits of a collaborative, national approach have already been demonstrated by the Common Drug Review (CDR). NPS work to date in this area has involved exploring the feasibility and benefits of expanding the CDR to all drugs, focusing specifically on new indications for old drugs, and oncology drugs. A comparative analysis of formularies has also been conducted to inform the development of a common list of drugs reimbursable by jurisdictions.
RECOMMENDATIONS
The Ministerial Task Force recommends that officials:
- Pursue a staged expansion of the Common Drug Review and common review processes to increase commonality of public plan formularies;
- Continue work to design a common national formulary.
Drug Pricing and Purchasing Strategies
The Canadian pharmaceuticals market is complex, with multiple payers, competing incentives, priorities and interests. Today there is limited price or purchasing coordination among FPT drug plans, and this lack of collaboration means public plans potentially under-utilize their significant purchasing power and allow industry to command higher prices. Work in the area of pricing and purchasing seeks to address this issue and contribute to the sustainability of public drug programs by: (1) achieving international parity on the prices of non-patented drugs; (2) developing pricing and purchasing strategies to obtain the best prices for prescription drugs and vaccines in Canada; and (3) accelerating access to affordable medicines for Canadians.
Activities have focused on attaining more competitive prices for non-patented drugs (multiple and single source) in Canada by developing and analyzing strategic options for a comprehensive national pricing and purchasing framework. Academics and the generic pharmaceuticals industry have been engaged in the development of options to achieve more competitive pricing and address rebate and marketing-conduct issues within the non-patented drug supply chain. The Patented Medicine Prices Review Board (PMPRB) is also now monitoring and reporting on international non-patented prescription drug prices; the first of these monitoring reports was published on July 4, 2006. Based on the data used in that report, the PMPRB estimates that, if Canadian prices did not exceed corresponding international median prices, 2005 Canadian non- patented prescription drug spending could have been reduced by as much as $1.47 billion.
RECOMMENDATIONS
The Ministerial Task Force recommends that:
- A non-regulated, business-management approach to drug pricing issues, with priority on non-patented drugs, be pursued;
- Consideration of regulatory approaches also continue.
Real World Drug Safety and Effectiveness
Drugs approved by Health Canada are required to undergo rigorous pre-market clinical testing. However, evidence based only on controlled clinical trials in carefully selected patient groups can not completely predict a drug’s safety and effectiveness in the real world. This information gap is a barrier to effective, evidence-based decision making for all involved in the regulation, prescribing, utilization and reimbursement of medications. Work in the area of real world drug safety and effectiveness aims to develop a stronger system for gathering, interpreting and applying drug safety and effectiveness information in Canada. Work to date to strengthen the evaluation of drug safety and effectiveness has resulted in the development of four interdependent strategies: creation of a national oversight body to support collaboration and priority setting; establishment of a research network to strengthen existing capabilities; building ´front-line’ participation and new opportunities; and the establishment of clear standards and transparency of evidence. These strategies came in large measure from a two-day, multi- stakeholder conference, held to gather input and identify areas of consensus. This conference revealed a variety of opportunities and the existence of broad support for building the mechanisms and capacity necessary to optimize real world safety and effectiveness.
RECOMMENDATION
The Ministerial Task Force recommends that:
- Stakeholder consultations be undertaken on the four interdependent strategies (i.e., an oversight body, a research network, engagement of primary care and hospital teams, and the establishment of clear standards and transparency of evidence).
Progress on other NPS Elements
While efforts to date have focused on the five priority elements of the NPS, work has continued outside the NPS process in a number of other areas, including electronic prescribing (e-Rx), and appropriate drug prescribing and use.
Moving Forward
The submission of this report to First Ministers marks the beginning of a new phase for the NPS. The next phase will include continued work in the five priority areas, as follows:
- On catastrophic drug coverage, governments will proceed with a policy and costing analysis, revising the methodology as necessary, to refine the CDC option(s) and gain a better understanding of the different costing and policy implications.
- On expensive drugs for rare diseases, governments will draw on a wide range of expertise, both from within government as well as the research community, patients and providers to ensure that a comprehensive EDRD framework is developed.
- On the common national formulary, governments will direct their efforts towards expanding the CDR at the Canadian Agency for Drugs and Technologies in Health (CADTH) to include new indications for old drugs; preparing a business plan on the development of a common review process for oncology drugs; continuing the analysis of the comparability of formularies, focusing on alignment of formulary policy approaches; and initiating an analysis of the expansion of the CDR process to class reviews.
- On pricing and purchasing strategies, governments will focus on: developing a business case and implementation plan for a non-regulated, business-management approach to non- patented drug prices while continuing to consider possible regulatory approaches; reviewing the findings of the first PMPRB report on non-patented drug prices and evaluating implications for pricing strategies; and monitoring developments in the pharmaceutical industry and the impacts of new legislation. The issue of expanded indications for patented medicines and approaches to related price reviews will also be explored.
- On real world drug safety and effectiveness, governments will complete work on a business plan for a pharmaceutical research network and a governance structure, while respecting federal regulatory responsibilities in this area. Governments will also engage key stakeholders in the fall of 2006 on the business plan and surveillance/research priorities. A discussion paper outlining the full scope of the safety and effectiveness issues, including issues related to surrogate endpoints and biomarkers, will also be used in engaging stakeholders.
The next phase of the NPS will see further opportunities for stakeholder engagement. Appropriate and targeted consultation with stakeholders will be a critical success factor in the further development and successful implementation of the NPS.
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