Pharmacare Blueprint for Canada Caveat Emptor: Buyer Beware

June 2, 2016

Webinar Agenda

1. Historical background2. Some proposed models3. International comparators4. Mental health perspective5. Draft vision6. Draft values and principles7. Next steps

2003 First Ministers Health Accord

• National Pharmaceuticals Strategy (NPS)• F/P/T commitment that:

“No one will be denied access to necessary, very high cost drugs based on where they live, or their ability to pay.”

Two Options for Design Proposed

1. Option one:Threshold for the program: variable percentage of family income from 0%, 3%,6% and 9% after which drugs covered 100%. Below $20,000 income =0% and above $90,000 = 9%.

2. Option two: 5% fixed income threshold after which drugs are covered 100%

Kirby and Romanow Reports 2002, Commission Recommendations

• Both supported catastrophic drug plans.

• Both identified maximum $1500 per annum threshold for catastrophic drug transfer to federal plan.

> Kirby added 3% of household income to a maximum of $1500 per year as threshold for a pan-Canadian catastrophic drug plan.

Ontario Minister of Health’s Expert Roundtable June, 2015

Group of academics, provincial government bureaucrats and politicians, consultants

Issues raised included: Increasing costs and prices of brand, generic drugsPoor prescribing practicesHTA recommendationsLimited drug budgets both publicly and privatelyLimited R+D from industryAging populationRare diseases and novel drug innovations

Broad areas of consensus• Too many Canadians without coverage or

insufficient coverage. • Could spend less on prescription drugs and get the

same or better value.• Without substantive policy reform the current

situation could get worse.• We do not want a poor Pharmacare plan e.g. one

that provides “universal coverage” but one where patients cannot afford to take their medications or where the costs increase at the rate they have over the past 15 years.

Broad areas of consensus

• Decisions about publicly funded prescription drugs should be based on evidence and de-politicized to the extent possible.

• A good Pharmacare plan would focus not just on providing coverage to the entire population but would include improving the quality of prescribing practices.

• The development of a good pharmaceutical plan requires ongoing evaluation and refinement.

Broad areas of consensus

• The goals of a pharmaceutical plan should be a program that produces better health outcomes at a lower total cost than we currently spend and provides a good experience for patients.

• Main Implementation solution identified– Pharmacare as defined by a common national list of drugs covered by

all jurisdictions• Federal Minister of Health’s Mandate

– Exploring the need for a national formulary• Announcement of an F/P/T Working Group to study

Pharmacare.– Announcement of an F/P/T Working Group to study Pharmacare

• Liberal Party endorsement of Pharmacare– May 28-29 Convention

Political developments in Pharmacare

Key take-aways from M-A Gagnon

By Marc-André Gagnon*, PhDAssociate Professor, School of Public Policy and Administration

(Carleton University) Email: ma_gagnon@carleton.ca ; Twitter: @MA_Gagnon

*Research funded by Faculty of Public Affairs (Carleton University), CIHR, Canadian Federation of Nurses’ Union, Health Canada.

-SG Morgan, MA Gagnon, B Mintzes and J Lexchin. « A Better Prescription: Advice for a National Strategy on Pharmaceutical Policy in Canada ». Healthcare Policy, 12(1) May 2016.

Reforming Drug Coverage:

Universal, Public, Evidence-based, Pan-Canadian,

Comprehensive, Integrated Pharmacare Program with

first dollar coverage for medically necessary cost-

efficient drugs

Pharmacare for Canada:1. Eliminate fragmentation: 1 drug plan for all Canadians, funded through general tax revenues.2. Improve equity of access (National Formulary).3. Depoliticized agency managing evidence based formulary with closed budget (like hospital formulary committee). 4. Clear mandate to maximize therapeutic value

for money. Systematic use of HTA.5. Systematic recourse to bulk-purchasing

capacity to contain cost6. Elimination of co-pays/deductibles based on

official prices. 7. Monitoring prescribing habits/promoting

rational use of medicines

Key take aways from international comparison

• M-A Gagon• Neil Palmer

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Denmark Chile

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11001010

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Total expenditure per capita on pharma-ceuticals,

2012 or nearest yearUS$, purchasing power parity

Source: CIHI, OECD Health Statistics 2014

Key take aways from international comparison

• Compared to most European countries: Canada has the highest growth in prescription drug cost (2000-2012)

• Kiwis: – Maximizing therapeutic value for every $ spent– HTA for all new drugs (positive list)– “No” Means “No”– Tendering– Reference pricing– PLAs and negotiations– Clauses to reduce shortages

Key take aways from international comparison

• UK: – Universal Pharmacare Integrated with Medicare– NICE (negative list)– Low or no co-pays– 209 clinical commission groups – each with a budget set by NIH– Innovative reimbursement schemes - Velcade – Poor performance of cancer drug listings – led to development of Cancer drug fund

• Germany: – based on price– Manufacturers still able to freely set a price for a new drug, but it will only apply during the first 12 months of

marketing– During year 1 manufacturers must prove their drug provides some form of added clinical benefit compared to

existing drugs• If NO added benefit reference-pricing scheme or pharma walks away

• France:– Price allocated based on clinical improvement scale– This system is unique, as both the level of co-payment and the price negotiations

depend on the added value related to effectiveness.

Public Pharmacare should not be an open bar

• Freedom of choice is freedom to pay out-of-pocket for what you want.

• Public provision of pharmaceuticals must be organized based on a normative framework focused on clinical evidence at every stage (approval of drugs, willingness-to-pay, prescribing habits, and monitoring appropriate use).

• Consulting patients in designing the reimbursement criteria is central, but societal values of fairness and equity should underpin design. Every dollar spent should maximize therapeutic gain.

• Mechanics and decisions for reimbursement should be clear and transparent. Decision-making should be accountable but depoliticized.

Model Proposed by Canadian Treatment Action Council (CTAC), 2009

Universal Catastrophic Drug Plan Legislated addition to existing public plans Multi- stakeholder funded insurance plan Available to all Canadian residents i.e. universal, needs based For prescription drugs, biologics, medical devices, approved

by HC Rare diseases included Cosmetic treatments excluded Prescribed by a regulated HC professional No waiting period from province to province For those without any or adequate coverage

CTAC Model Coverage and FundingFirst dollar coverage after cost sharingSliding scale cost sharing based on family income and

tax bracket$0 cost for those in lowest tax bracket$ TBD for each higher tax bracketNo increased cost to anyone as a result of plan

introduction from last year’s out of pocket expensesF/P/T governments and employers will also contribute

Mental Health Implications

• Access to a wide range of treatments and supports has been a long-standing policy priority for the Schizophrenia Society of Ontario (SSO)

• SSO believes that all treatment types should be accessible to individuals and families including:– Community services – Social supports– Psychiatric treatment – including medications

Mental Health - Context• The intersection between mental health and physical

health is dynamic, for example:

– The diagnosis and treatment of cancer has a significant impact on mental health

– People with schizophrenia who are diagnosed with cancer, for instance, have poorer outcomes than the general population

• People with mental illness often use more than one medication due to the presence of other concurrent physical and mental health conditions

Intersection - Issues Accessing Medications

• There are also intersecting challenges with accessing needed medications, including:– Affordability – Gaps in transitions between plans and systems– Delays in medication listing timelines– Listing decisions and system sustainability

• Pharmacare as defined by a common national list of drugs covered by all jurisdictions would not solve these issues

Key Considerations• Equal opportunity to access therapies regardless of social

determinants of health• Values and principles:

– Social justice - uphold equal opportunity for all social determinants of health

– Protect existing individual access to therapies at their current level– Ensure access to medically necessary therapies for uninsured and

underinsured residents of Canada regardless of ability to pay or place of residency

– Retain pharmaceutical system savings within the Pharmacare budget in order to provide increased access to therapies

– Ensure recognition and value of real world evidence in determining therapeutic value

Economic Analysis

• No detailed economic analysis and forecasting of cost of a universal drug plan has ever been undertaken

International Comparators

• While other OECD countries have a universal drug system, “universal” refers to population inclusion not inclusion of all treatments

• No plan is without some cost to the participants

Our Vision

• All people residing in Canada have timely, consistent, equal and equitable access to safe, appropriate and effective therapies, including treatments and medications, as well as the information, diagnostics, care and support that they need, without conditions.

• This is part of a broader vision for every person to have equal opportunity to access therapies regardless of social determinants of health.

Our Values and Principles• Respect for people who access the health system and their

support team.• Meaningful and ethical engagement of people who access

the health system including engagement in health systems planning, decision making, implementation, knowledge transfer and exchange, monitoring and evaluation, systems redesign.

• Universality and equality recognizing diversity and accommodation.

• Transparency and information sharing in all health systems processes and health policy decisions.

Our Values and Principles• Support for health innovations including access to

innovative therapies as required.• Excellence in health systems and health policy,

including recognition of the importance of integrating best practices in evidence-based qualitative and quantitative medicine and the importance of an accountability framework for all health systems processes and health policy.

• Capacity building and mentoring.• Social Justice to uphold equal opportunity for all

social determinants of health.

Our Values and Principles• Ensure protection of existing individual access to

therapies at their current level.• Ensure access to medically necessary therapies for

uninsured and underinsured residents of Canada regardless of ability to pay or place of residency.

• Ensure recognition of the discrete and distinct needs of people with life threatening and serious debilitating illnesses that significantly impact quality of life.

Our Values and Principles• Ensure recognition and value of real world evidence

in determining therapeutic value.• Ensure that pharmaceutical system savings are

retained within the Pharmacare budget in order to provide increased access to therapies.

• Ensure that Pharmacare builds on health care mechanisms and systems already in place.

• Develop value-based drug pricing contracts, including systems for data sharing and other relevant information.

Our Values and Principles

• Analyze the value of a drug for a Pharmacare system to include savings in other parts of the health care budget and broader socio-economic impact.

• Expand health technology assessment processes to measure the value of all components of the health care budget.

Next steps

• Finalization of report to be disseminated broadly for endorsement among patient organizations.

• Dissemination to all stakeholders, including: government, policy makers, health care professionals, academics.

• Request for inclusion on agenda of next F/P/T Ministers of Health meeting (fall 2016).

• Seek opportunities for public education.

What can you do to help?

• Consider endorsing finalized Vision, Values and Principles organizationally and individually.

• Disseminate broadly to stakeholders.• Consider meeting with provincial and federal

representatives.• Get in touch with us if you want to get more

involved: contact Jackie Manthorne at jmanthorne@survivornet.ca

Canadian Cancer Survivor Network Contact Info

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