Posted 04 October 2017
By Matthew Brougham, MSc, William O'Neil, PhD, Dima Samaha, MAS, PharmD
This profile summarizes reimbursement processes in Canada, presents information for key stakeholders and highlights what should be considered early in the development process.
Obtaining regulatory approval for medicines is the first major hurdle of most pharmaceutical and biotechnology companies looking to launch their products worldwide. However, obtaining market access once products are approved by regulatory agencies (e.g., Health Canada) is a separate and crucial process without which patients would not have access to new therapies. Each country has a complex process with varying requirements by various agencies resulting in pharmaceutical companies' having to establish product value above and beyond clinical efficacy.
Canadian Reimbursement Process
|Table 1. Key Reimbursement Stakeholders|
|Canadian Agency for Drugs and Technologies in Health (CADTH)|
CADTH is an independent, not-for-profit organization funded by the federal, provincial, and territorial governments (except Quebec). Its main role is to provide evidence and advice to Canadian healthcare decision makers about drug funding decisions and the optimal use of health technologies.
|Therapeutic Products Directorate (Health Canada) |
Health Canada is a federal authority responsible for regulating pharmaceutical drugs and medical devices for human use. Its main role is to grant marketing and distribution authorization, termed "Notice of Compliance" (NOC).
|Institut National d'Excellence en Santé et en Services Sociaux (INESSS) |
INESSS is an independent provincial body responsible for clinical excellence and the efficient use of resources in the health and social services sector, including drug funding decisions for Quebec.
|pan-Canadian Pharmaceutical Alliance (pCPA) |
pCPA is responsible for joint, public drug plan negotiations for brand drugs in Canada.
|Patented Medicine Prices Review Board (PMPRB) ||PMPRB is an independent body within Health Canada to regulate prices for prescription and non-prescription patented drugs sold in Canada.|
To market a pharmaceutical in Canada, its supplier must gain a Notice of Compliance (NOC) or NOC with conditions (NOC/c) from Health Canada. The Patented Medicine Prices Review Board (PMPRB) must be notified of its sale price upon the first sales being made anywhere in the country, regardless of its regulatory status, and continually satisfied regarding other ongoing reporting requirements.
The 10 Provinces and three Territories of Canada are responsible for delivering and funding healthcare. Decisions to list an intervention for reimbursement ultimately lie with each Minister of Health. Provinces have varying capacity to implement recommendations and may have unique demographics, insurance structures or agencies covering specific disease areas (e.g., British Columbia's Centre for Excellence in HIV/AIDS or Cancer Care Ontario) and formulary eligibility, which leads to unique reimbursement environments. Even provinces with similar drug plans may take unique listing approaches in a given therapeutic area, owing to accumulated differences in priorities over time or based on differences in affordability or approaches to HTA. Public programs primarily cover seniors, welfare recipients, and other groups (e.g., HIV patients) for whom drug costs represent a significant financial burden, although this varies across provinces with some provinces having universal coverage through a mix of public and private plans. All inpatient medications are covered throughout Canada. There are also federally funded and delivered drug plans for first nations (non-insured health benefits), veterans, penitentiary inmates, armed services personnel, and the federal police.
Private payers - making up approximately two-thirds of working Canadians - are covered for drugs and other healthcare interventions through private insurance. There are 22 private payers in Canada.
Provinces, hospitals, and private payers maintain their own formularies and may require dossiers to be submitted. In Quebec, private insurers are required to cover at least all drugs listed in the provincial formulary and INESSS makes recommendations toward listing drugs to be dispensed in public hospitals.
Figure 1. Reimbursement Landscape in Canada
Common Drug Review (CDR) submissions are made for non-oncology products classified as new drugs, drugs with new indications, new combination products, or subsequent entry biologics (biosimilars). A CDR submission is structured to cover all provinces (except Québec) and the federal drug plans and may be submitted before or after receipt of NOC or NOC/c. Sponsors submit a dossier to the Canadian Drug Expert Committee (CDEC) covering efficacy, effectiveness, safety information and economic and epidemiologic information.1 A pharmacoeconomic model is required.2 A copy of the Product Monograph (or draft if submitted as a pre-NOC review) is required. Also submitted within 20 days of the initial submission are Category 2 components which are, in effect, the provincial drug plan submissions for which CADTH act as a secretariat. These secondary requirements include budget impact analyses for each of the nine provinces. The tenth province, Québec, is handled entirely through INESSS). A CDR submission is a submission to each of the provinces and the federal health plans; follow-up is jurisdiction-by-jurisdiction as CDR recommendations are non-binding.
Pan-Canadian Oncology Drug Review (pCODR) submissions are made before or after receipt of NOC or NOC/c, for new oncology drugs, oncology drugs with new indications, or biosimilars.3 Submissions may be sponsored by a manufacturer, a provincially recognized clinician-based tumor group, or the Provincial Advisory Group (PAG). Clinical and economic reviews are undertaken by the pCODR Expert Review Committee (PERC), incorporating patient/patient advocacy group, and clinician input. Preliminary and final recommendations are publicized. Components of the submission are very similar to those of CDR, and like CDR, recommendations are non-binding.
INESSS submissions begin with a manufacturer's registration application. Applications can be made at any time starting in October 2017, except for generic drugs or natural products, for which filings follow specified deadlines. Applications may be made 180 days in advance for cancer drugs and 90 days for other drugs, or after receipt of NOC (NOC/c) and cover new drugs, new indications, new combinations, biosimilars and generics. The application includes clinical and economic evidence (both economic and budget impact models) and forms. If the application is accepted as complete, the review by Comité scientifique de l'évaluation des médicaments aux fins d'inscription (CSEMI) is scheduled and health professionals, consumers, and patients, as well as their associations or groups are invited to offer feedback or observations on the drug products under consideration. The committee is comprised of scientists, clinicians, ethicists, managers and members of the general public. For INESSS to make recommendations to the Minister, a medication must demonstrate therapeutic value. If the therapeutic value is not established to the satisfaction of INESSS, it sends a notice to this effect to the Minister. However, if the therapeutic value of a drug has been demonstrated, INESSS assesses the reasonableness of the price charged, the cost-effectiveness ratio of the medication, where the cost includes the price of the medication, the costs related to its use and effects, and the impact that entering the medication onto the list will have on the health of the general public and other components of the health and social services system. The advisability of entering the medication on the list with regard to the purpose of the public plan, which is to ensure that citizens have reasonable and fair access to the medication required by their medical condition, is also assessed.
After receipt of a positive recommendation from CADTH processes (and INESSS for Quebec), the pan- Canadian Pharmaceutical Alliance (pCPA) negotiations follow these steps:
- Provinces decide whether negotiations should take place; they also may decide whether it is best to negotiate individually or collectively and they may decide not to negotiate price at all. Provinces also may choose to bring forward a product that has not been assessed by CADTH.
- If pCPA negotiations are the way forward, a "lead" jurisdiction is assigned to represent provinces wishing to participate in a particular negotiation.
- Manufacturers are invited to initiate negotiations with the lead on behalf of the participating provinces. Negotiation may include terms and conditions beyond price.
- If an agreement is reached, a Letter of Intent (LOI) is signed by the manufacturer and the lead province on behalf of the participating provinces.
- Product Listing Agreements (PLAs) are then negotiated with each participating province/territory on the basis of terms in the LOI. Provinces also may choose to not negotiate a PLA even after a manufacturer has received a signed LOI.
Medical devices for human use in Canada fall under the jurisdiction of the Medical Devices Bureau (MDB) of Health Canada's Therapeutic Products Directorate. Reimbursement, purchasing and procurement decisions largely take place at the level of regional health authorities or by individual hospitals that are private not-for-profit institutions. Also, some devices are purchased or reimbursed through provincial health ministry-led specialty programs or some provincial governments fund provincial level HTA programs. While playing an increasing role in decisions about new medical devices, HTA is not consistently applied. HTAs are relatively few compared to the number of new medical devices entering the market. There are no formal application processes for HTA of medical devices.
In Quebec, INESSS has a standing committee(Comité Scientifique Permanent des Analyses de Biologie Médical) for medical biology tests. The committee conducts assessments based on evidence of clinical benefit, clinical validity, analytical validity, costs, and various other issues, including those of economic, organizational and ethical importance.
This profile provides an overview for navigating the reimbursement landscape in Canada. Further, more detailed information is available through the following links:
Common Drug Review
Health Canada – Drugs and Health Products
INESSS Submission Guide
Institute of Health Economics (Medical Device Information)
pan Canadian Oncology Drug Review
Status of Negotiations
- CDR Guidelines, Procedures, and Templates. CADTH website. https://cadth.ca/about-cadth/what-we-do/products-services/cdr/common-drug-review-submissions/guidelines-procedures-templates. Accessed 30 August 2017.
- Guidelines for the Economic Evaluation of Health Technologies: Canada. CADTH website. https://www.cadth.ca/about-cadth/how-we-do-it/methods-and-guidelines/guidelines-for-the-economic-evaluation-of-health-technologies-canada. Accessed 30 August 2017.
- pan-Canadian Oncology Drug Review Submission Guidelines. June 2017. CADTH website. https://cadth.ca/sites/default/files/pcodr/pCODR%27s%20Drug%20Review%20Process/pcodr-submission-guidelines.pdf. Accessed 30 August 2017.
About the Authors
Matthew Brougham, MSc, is a Canadian expert and senior consultant for Analytica Laser, Montreal. His professional background includes 17 years in senior public sector positions in New Zealand and Canada, including three years as vice president of Canada's Health Technology Assessment Agency (CADTH) and five years as chief executive of New Zealand's universal drug benefit program (PHARMAC). He is an expert in the scientific, economic and financial analysis essential for efficient and equitable allocation of public and private resources and has applied this expertise primarily to the health sector, pharmaceutical benefit program management and design. He holds degrees in natural resource management (MSc hons, Canterbury University, NZ) and a post graduate diploma in health economics (University of Tromso, Norway). He can be contacted at email@example.com.
William O'Neil, PhD, is associate director for Analytica Laser, Montreal. Prior to joining Analytica, Bill worked in pharmaceutical pre-clinical research and development at Xenon Pharma and QLT Inc. His earlier research, at McGill University and Wayne State University in Michigan, involved investigation of the differential capacities of HIV/AIDS patients to metabolize drugs and the differences between genotype and expressed phenotype of drug metabolizing enzymes among AIDS patients. As an associate director at Analytica, he participates actively in all production activities, including systematic literature reviews and analysis, health outcomes studies and analysis (such as costing, database analyses, gap analysis), budget impact modelling and multicriteria decision analysis, as well as honing his strategic and communication skills in the development of briefing documents, global value dossiers, evidence-based formulary submissions and dissemination materials (manuscripts and presentations) on numerous topics. He can be contacted at firstname.lastname@example.org.
Dima Samaha, PharmD, MAS, trained at the Lebanese American University and HEC Université de Lausanne. Dima joined Analytica as an independent consultant, advising key players in the pharmaceutical and medical devices industries as well as not-for-profit organizations on reimbursement pathways, market access strategies, custom monitoring and research activities on the political, legislative and regulatory landscape to assess policy drivers, enablers and challenges to market access. Previously, she was an advisor on innovation and external affairs at INESSS (Québec) and created an advisory committee on HTA and innovative technologies that includes patients, technology users, government payers, clinicians, researchers, healthcare managers and representatives from the pharmaceutical, biomedical and information technology industries. On behalf of WHO, she is currently involved in the development and analysis of the results of its first survey on the status of the use of HTA principles in its 194 Member States. She can be contacted at email@example.com.
Cite as: Brougham, M., O'Neil, W. and Samaha, D. "Canada Reimbursement Profile." Regulatory Focus. September 2017. Regulatory Affairs Professionals Society.