Canada Finalizes Amendments to Drug Pricing Regulations
Posted 09 August 2019 | By
The government of Canada announced Friday final amendments to drug-pricing regulations that aim to better protect Canadians from patented drugs’ excessive prices with new regulatory tools.
The final amendments to Canada’s Patented Medicines Regulations
crack down on excessive prices by building on the federal drug price regulator’s controls to make patented drugs more affordable. The move will have a ripple effect across other countries and has already been met with mixed reactions. The amended regulations, which lay the foundation for National Pharmacare, will reportedly create C$13.2 billion ($10 billion) in cost savings over a decade.
Health Canada notes
that the list of countries Canada uses for drawing comparisons to set drug prices will change as a result of the amendments. The two countries with the highest prices—US and Switzerland—will no longer be comparison countries under the regulations. This change aims to better reflect Canada's population, economy and health care approach in prices.
The amendments will mark a shift away from sticker prices for the Patented Medicine Prices Review Board (PMPRB) to better assess whether a price for a patent drug is reasonable or excessive when determining ceiling prices. Patentees will be required to disclose to the PMPRB information provided to third-party payers about confidential price discounts and rebates on domestic prices. The PMPRB can also now take into consideration whether the price for a patent drug is excessive relative to the value the drug brings to the intended patient population.
“The PMPRB now has the tools and information needed to meaningfully protect Canadian consumers from excessive prices today and into the future,” said
PMPRB chair Mitchell Levine.
The amendments were proposed
in 2017, with a target date for the amended regulations to come into force in January. Pushback
led to their entry into force being delayed to 1 July 2020.
“Insurers believe that a strengthened PMPRB is a vital step towards modernizing the regulatory environment around drug prices in Canada,” said
Canadian Life and Health Insurance Association President and CEO Stephen Frank. The association believes that, “The approach outlined today strikes the right balance between lowering prices across Canada over time while ensuring that Canadians continue to have access to the innovative medicines that they need.”
Innovative Medicines Canada (IMC), however, raised concerned with the amended regulations.
“Our fear is that patients will be worse off,” said
IMC President Pamela Fralick. The regulatory changes have jeopardized our industry’s incentive to invest in innovation in Canada” and they “will also impact global decision making with respect to the launch of clinical trials in Canada."