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Pricing and Reimbursement

Pricing and Reimbursement. Policies. 27. Pricing Policies Patented Medicines • Patented Medicine Prices Review Board (PMPRB) monitors and sets the price of patented medicines • Judges whether a price is “excessive” for new patented drugs and existing patented drugs

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Pricing and Reimbursement

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  1. PricingandReimbursement Policies 27

  2. PricingPoliciesPatentedMedicines •PatentedMedicinePricesReviewBoard(PMPRB)monitorsand setsthepriceofpatentedmedicines •Judgeswhetherapriceis“excessive”fornewpatenteddrugs andexistingpatenteddrugs •PMPRBregulationsmandatedandguidedbys79-103the PatentAct •PMPRBuses2stepprocesstosetandreviewpricesfornew patenteddrugproducts: 1. 2. Scientificreview Pricereview 28

  3. ScientificReview •Thepurposeofthescientificreviewprocessistoestablish: “leveloftherapeuticimprovementofapatenteddrugproduct” •LeveloftherapeuticimprovementassessedbyHumanDrug AdvisoryPanel •Fourcategoriesoftherapeuticimprovement: 1. 2. 3. 4. Breakthrough SubstantialImprovement ModerateImprovement SlightorNoImprovement 29

  4. PriceReviewProcess •Leveloftherapeuticimprovementusedtodetermineifapriceis “excessive” 1. 2. 3. 4. Breakthrough:excessivepricedeterminedbyinternational referencepricing(IRP);France,Germany,Italy,Sweden, Switzerland,theUnitedKingdom,andtheUnitedStates SubstantialImprovement:priceisexcessiveifhigherofIRPprice ORhighestnon-excessivepricecomparedwithdrugsin therapeuticclass(TCCtest) ModerateImprovement:IRPand/orTCC SlightorNoImprovement:TCCorIRP 30

  5. PMPRBInvestigationsandHearings •PMPRBcaninitiateinvestigationsintoexcessivepricing •Ifexcessivepricingisdetermined,investigatedpartycanagree toalowerpriceandoffsetanyrevenuebasedonexcessive pricing(VoluntaryComplianceUndertaking) •Ifinvestigatedpartydoesnotagreetolowerpricevoluntarily PMPRBcanholdhearingsandultimatelyorderpricetobe loweredanddoublerevenueamountstobeoffset •Hearingdecisionsaresubjecttofederaljudicialreview 31

  6. ReimbursementPolicies •Prescriptiondrugscoveredthroughprivateand provincial/territorialpublicplans •Covers98%ofpopulation •Federalgovernmentonlyprovidescoverageforasmallnumber ofindividuals,circa.1million •Plansvaryinscope,coverageandreimbursementpoliciesfrom province/territorytoprovince/territory 32

  7. GenericSubstitutionandPricing Substitution •Interchangeabilityandsubstitutionrulessetatprovinciallevel •Substitutionrulesdifferfromprovincetoprovince •Biggestprovinces–includingOntario,BCandQuebec–allow, butdo notmandategenericsubstitution •Saskatchewan,Manitoba,PEI,NewfoundlandandLabrador mandatesubstitution Pricing •Highgenericpriceshaveresultedinprovincialpricecaps: i. ii. Ontario:pricescappedat25-35%ofbrandlistprice Quebec:cappedathighestprovincialpricee.g.Ontario iii.Alberta:pricescappedat45-56%ofbrandlistprice iv.BritishColumbia:pricescappedat35-42%ofbrandlist price 33

  8. FederalHTA •CanadianAgencyforDrugsandTechnologiesinHealth (CADTH)conducts“clinical,cost-effectiveness,andpatient evidence”assessmentsforpublicsectorhealthcaredecision makers •CommonDrugReview(CDR): –reviewofDrugSubmissionsfrompublicbodies –providesformularylistingrecommendationstoallCanadianpublicly fundedfederal,provincial,andterritorialdrugplansexceptQuebec. •Only50%ofdrugsthatundergoCDRrecommendedfor reimbursement •Finaldecisionrestswithprovinces/territories–CDRmakes recommendationdoesnotmandateformularylistings 34

  9. Provincial/TerritorialHTA •ProvincesandterritorieshaveownHTAbodies •Quebec:Agenced’ÉvaluationdesTechnologiesetdesModes d’InterventionenSanté •Ontario:MedicalAdvisorySecretariat(MAS) •Alberta:InstituteofHealthEconomics •Provincial/territorialrecommendationsarealsonon-binding 35

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