Still overpaying for generic drugs

A new study this week from the UBC Centre for Health Services and Policy Research shows that by international comparison, Canadians are still overpaying for generic drugs. In fact, an editorial by report writer Michael Law draws an analogy between how inflated our generic drug prices are and paying $60 for a cup of Tim Horton’s coffee.

In 2010, our report Generic Drug Pricing and Access in Canada: What are the Implications? found international prices for generic drugs in 10 other developed countries to be 15-77% lower than average Canadian prices. Unfortunately, it appears little has changed.

The report does point out that most provinces are making progress and focusing on reducing generic drug prices for their residents. In June, the premiers agreed to use collective buying power to drive down prices, and last week they assembled to work out the details. This is a positive step and we look forward to the impact this may have.

It’s vitally important that we continue to work to bring prices down so that Canadians can access the medication(s) they need. In 2011, we reported that 23% of sicker Canadians with chronic conditions skipped a dose of medication due to costs (and 12% of the general population did the same). This is unacceptable and has significant repercussions on the well-being of patients, while further burdening the health system.

You can read the full report here.

For more on generic drugs, read these blog posts:

• Two new reports on generic drugs in Canada
• Canadian Generic Pharmaceutical Association responds to Council's 'Generics' Discussion Paper 
• The Actra Fraternal Society reponds to Council's 'Generics' Discussion Paper 

Waste in the health care system

This week, a report from the Institute of Medicine showed that $750 billion of the $2.6 trillion a year that Americans spend on health care is wasted. This includes unnecessary, unplanned and unforeseen costs like excessive administration, inefficient delivery of care, fraud, and prevention failures.

It also includes a whopping $210 billion on unnecessary care, meaning over treating, prescribing or testing health care users.  André Picard noted that we cannot pretend this analysis does not also reflect the situation in Canada.

In 2010, we reported on the inappropriate use of diagnostic imaging and over prescribing. Our report showed that over the past 10 years, the number of prescriptions filled at community pharmacies has almost doubled – from 272 million in 1999 to 483 million in 2009. In terms of diagnostic imaging, compared to 2003, there has been a 58% increase in CT scans and 100% increase in the number of MRIs conducted. Of these tests, according to the Canadian Association of Radiologists, as many as 30% are inappropriate or contribute no useful information.

We need to leave the more-is-better attitude behind and innovate to improve our system.

Health Policy paper provides review of changes in pharmaceuticals policy

In 2009, the Health Council of Canada released a report on the National Pharmaceuticals Strategy, which commented on the patchwork of drug coverage policies across Canada.

A recent paper in Health Policy by Jamie Daw and Steve Morgan reviews the changes in pharmaceuticals policies over a decade (2000-2010).  The paper gives a good overview of the trends and changes in policy with regard to drug coverage in Canada, and presents a follow-up to our own findings in 2009. 

Although many provinces are moving toward income-based catastrophic[1] drug coverage, there continue to be differences in the types and amounts of drugs covered, depending on where in Canada you live.

Federal leadership is needed to protect all Canadians from the high costs of drugs. 

To read the abstract: Stitching the gaps in the Canadian public drug coverage patchwork? A review of provincial pharmacare policy changes from 2000-2010.

Shilpi Majumder, Policy Lead, Health Council of Canada

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[1] Catastrophic refers to the impact of the cost of drugs on one’s finances.

Key Words: Catastrophic drug coverage, Health Policy, National Pharmaceuticals Strategy

Two new reports on Generic Drugs in Canada reaffirm Health Council’s findings

John G. Abbott, CEO, Health Council of Canada

Earlier this week, I read with great interest the latest reports on generics drugs released by the Patented Medicine Prices Review Board (PMPRB).

One report, Generic Drugs in Canada: Price Trends and International Price Comparisons, 2007 compares the price trends of generic drugs in Canada to 11 other countries. The report found that ”…generic drugs cost less in foreign markets than in Canada. These price differences are substantial. The implications of the international price comparisons are clear… foreign prices are, on average, only about two-thirds of corresponding Canadian prices… for the majority of drugs and nearly all therapeutic classes”.

This independent assessment reaffirms findings in The Health Council’s recent report on generic drugs Generic Drug Pricing and Access in Canada: What are the Implications? Our report found that that international prices for generic drugs in 10 other developed countries to be 15-77% lower than average Canadian prices. Obviously little has changed (at least up to now).

The second PMPRB report Generic Drugs in Canada: Market Structure – Trends and Impacts suggests that generic drug products are highly concentrated in terms of sales. In 2007 the top four leading suppliers accounted for 96.7% of sales of generic drugs. The report noted that this concentration is not the fundamental source of difference between the Canadian and foreign prices. It goes on to refer to a recent study of the Canadian Competition Bureau that concluded “…competition among Canadian companies occurs principally through rebates provided to retailers. In a market framework of this sort one would expect more vigorous competition among companies to produce larger off-invoice rebates rather than lower prices”.

These reports reveal valid insight into generic drug pricing in Canada; however, their findings are based on 2007 and earlier data. Thus, they do not reflect the potential impact of recent policy changes to generic drug re-imbursement policies in Canada where provinces like Quebec, Ontario, Alberta, and British Columbia have taken major steps to reduce the cost of generic drugs.

For our health policy leaders, industry professionals, and the Canadian public to continue to make informed choices about generic drugs reports of this nature must be researched and published regularly.

Finally, I am encouraged by the progress to date. With leadership, positive changes are possible to control health system costs while improving access and maintaining quality. I look forward to reading future discussion papers that report on how the newly implemented policies and planned joint purchasing initiatives are reflected in downward pressure on generic drug prices in Canada and improved access to these drugs for Canadians.

Key Words: Pharmaceuticals Management, Generic Drugs

Drug Safety and Effectiveness in Canada – Charles Hain, Canadian Patient Coalition

The Health Council of Canada – Keeping An Eye on Prescriptions - report is to be commended for bringing forward the idea of a protocol for drug safety messages and their dissemination to stakeholders.

Earlier in 2010, a group of about 30 patient health organizations came together to host the first ever Canadian Patient Summit.  Over the course of two days at the end of March, more than 100 Canadians living with chronic health conditions discussed the future sustainability of healthcare policy in Canada from their vantage point.

While the Summit was not specifically convened to address pharmaceutical issues in Canada, drugs, medical devices and supplies were identified as costly out-of-pocket expenses for patients and a barrier to compliance to prescribed therapies.  For patients with chronic conditions, prescription medications and clinically prescribed therapies are often what helps them to live well, and outside of our hospital system or care facilities.

One critical observation made during the Summit was that in Canada, the patient is left out of any discussion leading to healthcare policy and implementation.  This includes, of course, the absence of an informed patient voice (their concerns, needs, and abilities) with respect to pharmaceutical development, approvals, surveillance and safety to name only a few of the issues.

No one disputes the need for greater after-market surveillance and reporting, nor could anyone desire anything less than rapid and broad disclosure of warnings after adverse drug reactions.  What is often lacking in this area is the process to include patients in discussions earlier in the development and deployment of surveillance protocols.

While MedEffect Canada is laudable, it continues to languish underutilized and perhaps misunderstood.  The sense among patient groups is that the public does not know of the existence of MedEffect rather than their lack of understanding or support for it.  Compliance in reporting adverse reactions would be higher if patients were involved in designing the forms, the process for reporting and for identifying what is important to report.  We have a tendency to blame patients when they don’t act upon the advice of experts.  Perhaps experts need to think more about whether what we are asking is overwhelming or difficult for patients to act upon.  Perhaps we need to ask patients what would work more effectively.

 A final thought has to do with jurisdiction.  In Canada’s federal system, it is not always clear which level of government has or should have the responsibility for various aspects of health care.  A national pharmaceutical program would be welcome by the majority of the public.  Likewise, the Canadian Patient Coalition, which arose from the Summit, advocates for a single electronic patient record which would allow experts to collect and analyse information on adverse reactions through a real-world surveillance of pharmaceutical therapeutic use, for example.

But the greatest positive contribution to sustainable healthcare policy in Canada is to increase patient and public engagement in these critical discussions.

For more information about the Canadian Patient Coalition: http://www.canadianpatientcoalition.ca/

Charles Hain

Public Affairs, Canadian Association of Wound Care & Coordinator,
Canadian Patient Coalition

Drug Safety and Effectiveness in Canada - David U Responds

David U, President and CEO, Institute for Safe Medication Practices Canada

On behalf of the Institute for Safe Medication Practices Canada (ISMP Canada), I would like to thank and congratulate the Health Council of Canada for preparing and disseminating their findings on the important topic of drug safety in Canada. It is encouraging to learn that a number of new initiatives are being put in place to enhance post-marketing surveillance and monitoring such as the “progressive licensing” approach, working with industry to encourage Phase 4 studies on marketed drugs, supporting Canadian research centres to focus on selected drugs for studying their real world effectiveness and safety, as well as creating the Drug Safety and Effectiveness Network. The discussion paper facilitates learning from information available nationally as well as internationally and will help enhance Canada’s ability to ensure the drugs being marketed and used in Canada are safe and will not trigger undesirable and potentially harmful side effects.

I would also like to take this opportunity to emphasize that we must ensure drugs are being used appropriately to prevent harm. Medication incidents (medication errors) leading to harm and death can be prevented. For example, there have been a number of fatal incidents involving the fentanyl transdermal system (fentanyl patches) and important information about this has been published by Health Canada. One such publication is the July 2008 issue of the Canadian Adverse Reaction Newsletter which highlights 52 cases with fatal outcome involving fentanyl patches; examples include incidents (errors) which involve healthcare professionals and consumers. ISMP Canada has also received incident reports related to fentanyl patches, and has issued several alerts and safety bulletins to healthcare practitioners as well as sharing learnings with manufacturer(s) for the purpose of enhancing labelling and packaging.

As part of Canadian Medication Incident Reporting and Prevention System (CMIRPS), the incident reports received by ISMP Canada contribute to knowledge in medication safety. For example, contributing to some harmful medication incidents is the confusion that has occurred from look-alike/sound-alike drug names and from look-alike labelling and packaging of pharmaceutical products. In October 2008, Health Canada initiated the development of a conceptual framework for the assessment of health product names for look-alike/sound-alike name attributes. An Expert Advisory Panel was created to support this development process, with representation from Health Canada, the Food and Drug Administration in the United States, ISMP Canada along with experts in the area of psycholinguistics and human factors. The proposed conceptual framework will inform the basis for the revision of the current Health Canada Guidance for Industry - Drug Name Review: Look-alike Sound-alike (LA/SA) Health Product Names. The guidance document will strive to bring greater scientific validity, transparency, objectivity and predictability to the evaluation of health product names for look-alike/sound-alike attributes. It is proposed that the framework and guidance will apply to the following product types for human use: prescription and non-prescription drugs, biologics, and natural health products. Over the past year, efforts have been focused on putting a number of health product names through each step of the proposed name review process to establish "proof of concept". It is anticipated that data gathering and analysis will be complete by 2011 followed by stakeholder consultation. Development of a similar framework is planned for labelling and packaging of pharmaceutical drugs for human use.

Learning from medication incidents occurs from reports received by both consumers and healthcare professionals as it provides useful information in detecting problems in the medication use system. In the spring of 2010, ISMP Canada launched a consumer medication incident reporting and learning web site: SafeMedicationUse.ca. Consumer reporting in Canada has resulted in important contributions to medication safety —10 newsletters and alerts have been published to provide incident learning and prevention strategies for all Canadians.

Another key project towards drug safety is the collaborative Canadian Pharmaceutical Bar Coding Project which aims to implement standardized bar codes on all aspects of pharmaceutical labelling. Headed jointly by the Institute for Safe Medication Practices Canada (ISMP Canada) and the Canadian Patient Safety Institute (CPSI), the initiative is guided by a national Implementation Committee and being developed with assistance from a 34-member Technical Task Force (TTF), representing six identified healthcare sectors. Adoption of the GS1 global standard for automated identification (e.g., bar coding) of pharmaceutical products in Canada has been endorsed. The multiphase project has developed draft technical requirements for Canadian pharmaceuticals in the following areas: bar code components and symbologies, product database elements, medications to be included in the categories to be bar coded, and packaging levels and bar code placement.
The report prepared by the Health Council of Canada will no doubt help to further raise the profile of drug safety. It provides the opportunity for the collective challenge in Canada for all of us to move collaboratively towards the common goal of drug safety.

--
David U is the President and CEO at the Institute for Safe Medication Practices Canada (www.ismp-canada.org)

Drug Safety and Effectiveness in Canada - Hugh McLeod Responds

Hugh B. MacLeod , CEO, Canadian Patient Coalition

From the patient’s perspective, medication can be a tricky proposition. On one hand, we put our faith in pharmaceuticals in order to cure disease and improve our quality of life. On the other, we know the disastrous effect they can have if prescribed or taken incorrectly.

In a recent discussion paper commissioned by the Health Council of Canada, designed in part to inform Canadians and stakeholders about drug safety and effectiveness issues in Canada and abroad, it is suggested that Health Canada adopt a protocol for developing drug safety messages and disseminating them to the various stakeholders following harmful incidents.

As it happens, the Canadian Patient Safety Institute (CPSI) is involved in the creation of a series of initiatives to equip healthcare providers with the information and supports necessary to minimize, and hopefully eliminate, the occurrence and severity of harmful medication incidents in Canadian healthcare organizations. This work could not have been accomplished without the support and dedication of Health Canada, the Canadian Institute for Healthcare Information (CIHI), the Institute for Safe Medication Practices Canada (ISMP Canada) and stakeholders from throughout the healthcare sector.

For example, earlier this year, CPSI launched a project resulting in national consensus with respect to the use of GS1 global bar coding standards for labeling medication packaging in Canada. This system is far and away the safest way to track pharmaceutical products from manufacture to administration.

Another initiative is the Canadian Medication Incident Reporting and Prevention System (CMIRPS). The aim of the CMIRPS Program is to strengthen Canada’s capacity to reduce and prevent harmful medication incidents and to manage and share information about voluntarily reported medication incidents. For instance, in the aftermath of a death in hospital due to the inadvertent injection of the drug epinephrine, which is intended for topical use, ISMP Canada issued a nationwide alert giving healthcare providers the information they need to ensure the error is never repeated.

While this type of information sharing on a national scale is commendable, we need to start thinking about patient safety on a global scale – after all, why make our own mistakes causing undue harm to patients when we can learn from those who have already gone down that path?

In the words of Dr. Dale E. Turner, “the error of the past is the wisdom and success of the future.”

We encourage you to become a patient safety champion in your organization by kick-starting the discussion around medication safety and how you can leverage the wealth of information that exists to minimize, and hopefully eliminate, the occurrence and severity of harmful medication events.

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Hugh B. MacLeod is CEO of the Canadian Patient Safety Institute (CPSI) 

To learn more about CMIRPS and bar coding visit www.patientsafetyinstitute.ca and to learn more about our medication reconciliation intervention visit www.saferhealthcarenow.ca.

Drug Safety and Effectiveness in Canada - Susan Eng Responds

Susan Eng, Vice-President, Advocacy, CARP

Are our drugs safe? Most Canadians assume so, given the clinical trials and multiple layers of government regulation – and perhaps more persuasively, complaints from pharmaceutical companies that such regulation unduly impedes market entry of their drugs. But it may not be so, according to the just released Health Council of Canada report, “Keeping an Eye on Prescription Drug, Keeping Canadians Safe.”

Once drugs get on the Canadian market, according to the report, there is no systematic scrutiny of the real world experience with the drugs. Clinical trials are limited in size and scope and do not usually include people with multiple medical conditions. The report concludes that as a result, more and more people are being exposed to unsafe drugs and cites the example of the high profile withdrawal of Vioxx and Baycol for safety reasons.

Consumer safety now depends on voluntary reporting of adverse drug reactions but this captures only 1% – 10% of such reactions. What is needed is a system to protect the public through early detection of safety concerns – called pharmacovigilance – a systematic monitoring of drug safety once the product is released onto the market.

Pharmacovigilance is still new and evolving worldwide, and the report canvasses and compares some international examples. None are comprehensive but Canada is barely on the grid.

A big part of the problem is that Health Canada – which has the primary responsibility for consumer safety – has limited authority to order the kind of steps necessary to monitor or uncover safety problems or to take action to prevent further use of drugs with safety problems. The report argues it has also failed to fully and effectively utilize the authority it does have. Presumably, the technical review and modernization process now being undertaken by Health Canada will help address these gaps.

The report argues for the establishment and funding of independent research and monitoring of the safety and effectiveness of drugs after they have been put onto the market plus a progressive licensing system to give Health Canada continuing authority to require compliance with drug safety measures including post–market [Phase IV] clinical trials. [1]

Hopeful signs include the recent creation and funding of the Drug Safety and Effectiveness Network which will research post market drug safety – but with no apparent responsibility for monitoring – and the proposed progressive licensing system which died on the order papers at the last prorogation.

CARP is a national, non-profit, non-partisan organization with 300,000-plus members across the country which advocates for changes that improve the quality of life for all Canadians as we age. Consumer safety is clearly a priority and our members would be appalled to think that the safety of the drugs they are taking [especially the newer ones] is not monitored on a systematic basis much less guaranteed and that there is no apparent process or responsibility to provide that guarantee.

Canadians are right to expect from the drug companies themselves a high level of integrity and good quality testing for safety and effectiveness before a drug comes onto the market. However, the limitations of the pre-market testing and the lack of systematic monitoring of post-market drug safety is a cause for concern.

The report’s recommendations are directed at redressing this concern and action should be taken on them as soon as possible.

--Susan Eng is Vice President of Advocacy for CARP, the national, non-partisan, non-profit organization committed to advocating for social change that will bring financial security, equitable access to health care and freedom from discrimination for all Canadians as we age.

Drug Safety and Effectiveness in Canada - Dr. Proton Rahman Responds

Dr. Proton Rahman, MD, FRCPC 

I wish to thank Health Canada for providing me with the opportunity to comment on this discussion paper. The paper which highlights why effective regulatory systems are needed is well informed providing a clear summary of the pharmacovigilance systems in place in a number of countries. This information is concisely summarized within table 3; although the inclusion of further information regarding the systems currently in place in Canada would add value to both the body of the text and the summary table. Analysis of this information will provide regulatory bodies with a springboard from which to develop a strategic vision for the implementation of effective pharmacovigilance systems throughout Canada.

The paper helpfully presents two planned developments for enhancing pharmacovigilance in Canada; the development of the Drug Safety Effectiveness Network (DSEN) and the introduction of Progressive Licensing. While the development of both of these initiatives should be applauded it should be noted that the DSEN is still in very early stages of development and a thorough review of the network’s effectiveness should be undertaken following an appropriate period of operation. The development of the DSEN should not lead to the exclusion of other post marketing research. As highlighted in the paper there is some concern regarding the impartiality of industry funded research, however this research should not be disregarded but instead the research environment be managed in such a way as to ensure impartiality in reporting.

The proposed introduction of Progressive Licensing, including conditional licensing (or release) would have a positive impact on “Keeping Canadians Safe” and potentially allow the earlier introduction of new drugs, however unless the introduction is backed with adequate legislation this impact will be severely reduced. The examples given of systems in place in other countries clearly highlight the need for supporting legislation to ensure the success of Progressive Licensing. Only through supporting legislation can it be ensured that pharmaceutical industries will abide by the terms of the license, such as the requirement for monitoring adverse events and the development and implementation of risk management plans. Progressive Licensing should not however be seen as the only answer, as there is benefit in other initiatives such as approvals through surrogate endpoints and mandatory post marketing surveillance of drugs known to have a higher risk of adverse events.

It should be noted that not all clinically relevant situations are assessed by randomized controlled trials. In such circumstances, information from disease registries can make an important contribution to the evidence base. In order for non-randomized prospective disease registries to adequately reflect clinically relevant outcomes it is important to register all relevant patients and capture accurate and comprehensive data through the collection of information on these patients in a defined area in a set time period. For this to occur it is vitally important for funding agencies to provide adequate and sustained resources for national disease registries. In the past, this has often not been a priority of funding agencies as such registries have been considered a “non hypothesis driven” initiative.

Regardless of how effective the pharmacovigilance and post-marketing surveillance systems are they are of limited use without the incorporation of effective methods of communication with prescribing Drs. The discussion paper highlights the need for developing more effective ways of communicating safety messages and this should be seen as one of the priorities of any resulting strategic plan.

The discussion paper also raises a number of issues regarding data collection, with many of the recommendations put forward reflecting the systems currently in place in Newfoundland and Labrador, where partner agencies have developed effective collaborative working arrangements to identify how disparate data sets may be shared and analyzed in a secure environment. Any initiatives to bring about collaboration and data sharing between provinces must give full consideration to the privacy and confidentiality issues that will arise, and as to how these relationships will be impacted by provincial privacy legislation.

On reading the paper it became clear that in order to prevent confusion in the future development of policy there is a need to ensure consistency in terminology when discussing pharmacovigilance and post marketing surveillance.

In order to ensure that any future strategies or policies reflect emerging technologies and future trends it is essential that consideration be given to the role of pharmacogenetics and personalized medicine in the enhancement of drug safety.

In summary this paper provides a good starting point for the development of a strategic vision for the introduction of nationally regulated pharmacovigilance, however if we are to truly “Keep Canadians Safe”, the vision must be developed in concert with all partners and address the broader issues of governance, privacy, data access and drug accessibility.

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Proton Rahman MD, FRCPC a rheumatologist and genetic epidemiologist in the Faculty of Medicine at Memorial University. He is an associate professor of medicine and consultant rheumatologist to Eastern Health at the St. Clare’s site.

Roy West1 PhD, Don MacDonald2 PhD, Catherine Street1 B.Pharm(Hons), Khokan Sikdar2 MSc, MAS, PhD (candidate), Proton Rahman1 MD1Population Therapeutic Research Group, Memorial University, St. John’s NL
2Newfoundland and Labrador Center for Health Information, St. John’s, NL

Conversation on Health Care in Canada

John G. Abbott, CEO, Health Council of Canada

Recently, many health care thought leaders have come forward to voice the need for an “adult conversation” on health care. With just over three years remaining in the 2004 10-Year Plan to Strengthen Health Care, these pre-emptive conversations are essential at all levels, but need to shift their focus to strengthening the current system.

Canadians have had many opportunities to review the health care system and determine what they want in such a system. These questions were answered in detail by the Kirby Report and the Romanow Commission. Health care experts need to be focused on building a stronger, comprehensive system, and the actions needed to move Canada forward.

Currently, Canada spends over $180 billion a year on health care costs (2009); an amount that will continue to rise unless we address the key issues. For example, the use of pharmaceutical drugs, especially by an aging population subject to multiple chronic diseases, is costing Canadians about $30 billion a year (2008). In the past 10 years, the number of prescriptions filled at community pharmacies has increased by almost 80%, and at the same time Canada’s relatively high generic drug prices are ensuring that filling this large number of prescriptions is expensive. The government has options to institute reforms and reduce costs, but we need a national pharmaceuticals strategy in order to do this. A national pharmaceutical strategy that governments have committed to since 2004.

As well, long-term care and home care are aspects that should be explored to improve the efficiency of the system. In 2009, $51 billion went to hospitals, and some of this was attributed to patients who would have been better served in long-term care facilities or under home care instead of occupying expensive hospital beds. Investing in long-term and home care has the potential to save the health care system a lot of money.

It is clearly important to have a dialogue on health care, but not to discuss and reiterate what we already know. The aforementioned reports have spoken: the majority of Canadians are committed to a publicly-funded health care service covered under Medicare. Now we need to discuss how we take this current system that Canadians value and move forward to make it better, stronger and more sustainable.

See The Globe and Mail’s “We need an ‘adult’ conversation on health and social transfers” by André Picard.

Key Words: Home and Community Care, Pharmaceuticals Management

The Ontario Pharmacists’ Association comments on Council's 'Decisions, Decisions'

This letter is from Mr. Dennis Darby, CEO of the Ontario Pharmacists’ Association in response to Decisions, Decisions: Family Doctors as Gatekeepers to Prescription Drugs and Diagnostic Imaging in Canada . We invite you to comment here in the blogspace. 

Family physicians need greater access to decision-support tools such as electronic medical records, a drug information system and electronic prescribing. Pharmacists need these tools too, but in the meantime, there is much they can do to help.

It’s a daunting task for any doctor to stay on top of the latest research about prescription drugs. Expert advice on medication is just one way pharmacists, and the drug information and research centre at the Ontario Pharmacists’ Association, can help. 

As the experts in medication and its management, pharmacists are key players on the health-care team, working closely with physicians and other health-care providers to ensure drugs are prescribed and used effectively. Through Bill 179, the Ontario government has acknowledged the tremendous value of pharmacists as medication experts by expanding their scope of practice. This new legislation is in keeping with the national trend toward more collaborative and interdisciplinary care.

Once this collaborative model takes greater hold, we will see profound changes in how medications are prescribed, used and monitored, by a more efficient and effective healthcare team that capitalizes on the expertise of its various professionals. 

Electronic health records, a drug information system and electronic prescribing will facilitate much of this work, and we must all push hard to make it happen.


--Mr. Darby’s comments in this blog are reproduced with permission from the Ontario Pharmacists’ Association. His letter previously appeared in several newspapers.

Canadian Association of Radiologists responds to Council's 'Decisions, Decisions' Report

This letter is from Ms. Adele Fifield, CEO of the Canadian Association of Radiologists. She contributed to the research and development of the report. We invite you to read Decisions, Decisions: Family Doctors as Gatekeepers to Prescription Drugs and Diagnostic Imaging in Canada then give us your thoughts on the important issues it contains.
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The Canadian Association of Radiologists (CAR) supports concerns raised in the newly released report, Decisions, Decisions: Family Doctors as Gatekeepers of Prescription Drugs and Diagnostic Imaging, by the Health Council of Canada.

The question of appropriate ordering of diagnostic imaging tests is an important one for all of us. Research shows that as many as 30% of CT scans and other imaging procedures are inappropriate or contribute no useful information. Reducing inappropriate imaging is essential in maintaining patient safety, in reducing wait times, and in using equipment and health human resources as optimally as possible.

Children and the imaging care they require was one of the many concerns shared just last week (September 20-22) at a World Health Organization (WHO) workshop on radiation risk communication in pediatric imaging. CAR was represented at the event by Dr. Martin Reed, Chair of the CAR Guidelines Working Group, and the group expressed interest in learning of the Health Council of Canada’s findings.

This report also highlights that a key step in ensuring the appropriate use of diagnostic imaging tests in Canada will be better and broader use of guidelines. Greater attention can and must be paid to communicating these guidelines to physicians from the early stages of their training and throughout their careers -. As mentioned in the report, CAR is responding, in part by redeveloping its Diagnostic Imaging Referral Guidelines: A Guide for Physicians. We’ve also been working to make guidelines a part of the physician’s daily workflow by incorporating imaging guidelines in electronic decision support with computer order entry. We are further studying compliance with imaging guidelines.

In addition to the role played by physicians in efforts to increase appropriate ordering, patients also have a role to play in what they are demanding of their doctors. We hope that this report will help Canadians better understand the dynamics within the health care industry. We are very pleased to speak about this topic from the perspective of radiologists.

Wishing you well,
Adele

The Actra Fraternal Society reponds to Council's 'Generics' Discussion Paper

This letter from Mr. Robert M. Underwood, President and CEO of the Actra Fraternal Benefit Society responds to our discussion paper, “Generic Drug Pricing and Access in Canada: What are the Implications? We invite you to read our discussion paper and Mr. Underwood’s response, then give us your thoughts on this important issue.

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RE: Your letter to Ferne Downey, National President – ACTRA

Actra Fraternal Benefit Society is a not-for-profit Fraternal Benefit Society providing insurance and retirement services to performers and writers (members of the Writers’ Guild and ACTRA). AFBS is owned by our Members and as such, we have a vested interest in providing cost-effective programs, with HealthCare being one of our primary focuses.

We have provided a ‘mandatory generic’ prescription drug program for our members for approximately 14 years, and we provide for brand-name only where there is not generic substitute, or where the physician clearly prescribes ‘no substitution’.

Within our electronic adjudication process, in addition to providing a managed formulary for our Members, we allow for ‘best available price + 10% markup’ and we are somewhat concerned that recent legislation ion Ontario could force retail pharmacy to re-address their markup policy, which could result in increased costs for our Members. 

We are aware of the commitment to a National Pharmaceutical Strategy, and would applaud such a strategy; however this has been a plank within a number of political platforms for a number of years, and execution of the strategy remains a question mark.

Our insurance (including comprehensive HealthCare benefits) is essentially paid for by Members through contract contributions from producers and through additional contributions from Members.

The Society (following our not-for-profit model) returns all operating surplus back to members in the form of insurance subsidy which can range up to 30% of premium cost.

That is to say, any cost containment value which results from the Ontario generic drug pricing initiatives will be passed on to our members and reflected in our program cost for Members.

We appreciate your link to the ‘Generic drug pricing and access in Canada’ report and you are certainly welcome to post our comments on the Health Council website discussion board.

Canadian Generic Pharmaceutical Association responds to Council's 'Generics' Discussion Paper

This guest blog is a letter from Mr. Jim Keon, President of the Canadian Generic Pharmaceutical Association to Health Council of Canada CEO, John G. Abbott, in which Mr. Keon responds to our discussion paper, “Generic Drug Pricing and Access in Canada: What are the Implications?”, and to issues faced by Canadian-based generic drug producers generally. Mr. Keon offers insight into the dynamics of generics pricing and access from industry’s perspective, with specific comments on the Quebec and U.S. markets. We invite you to read our discussion paper and Mr. Keon’s response, then give us your thoughts on this important issue.

Dear Mr. Abbott:

Thank you for your invitation to the Canadian Generic Pharmaceutical Association (CGPA) to comment in writing on the public discussion paper entitled, Generic Drug Pricing and Access in Canada: What are the Implications? commissioned by the Health Council of Canada.

There are many aspects of the discussion paper that are quite useful and deserve further exploration and debate. It is, however, unfortunate that media coverage of the paper focused almost exclusively on sales data for reimbursed or retail prices of generic drugs in Canada that is more than five years old. This sales data is no longer reflective of the Canadian market due to major changes to the system for generic pricing and pharmacy compensation that have occurred in approximately 90 percent of the Canadian market since its original publication.

Given the changes to generic pricing and pharmacy compensation that have occurred in the past five years, the most relevant aspects of the discussion paper are related to access of generic prescription medicines and how Canada can improve generic utilization to maximize savings for governments, employers, unions and patients.

Below, I will address both price information and issues related to access.

1) Data on retail/reimbursed prices for generic drugs is five years old and no longer reflects the Canadian market

The data used in the discussion paper to support the notion that retail or reimbursed prices for generic drugs are too high in Canada come from a 2006 Patented Medicine Prices Review Board (PMPRB) report that examined sales data from 2005. The PMPRB reported on retail or reimbursed prices of generic drugs in several countries, not net prices charged by manufacturers in these jurisdictions. As the paper notes, Canadian retail or reimbursed prices for generic prescription medicines include significant support for the services community pharmacies provide to their patients.

Since the publication of the PMPRB report, retail or reimbursed prices for generic pharmaceutical products have been dramatically reduced in Canada, including in the provinces of Ontario, Quebec, Alberta, British Columbia, Manitoba and Nova Scotia. In fact, retail or reimbursed prices for generic drugs have been reduced by 75 percent in the Province of Ontario, Canada’s largest pharmaceutical market. In addition, alternative mechanisms for the funding of pharmacy services in Canada are also being addressed.

It must also be noted that generic drugs provide excellent value for Canadians. According to IMS Health, the world’s leading source for prescription drug sales information, in 2009 generic drugs were dispensed to fill more than 54 percent of all prescriptions in Canada yet accounted for only 24 percent of the $21.5-billion spent on prescription medicines.

2) Prices don’t matter if Canadians don’t have access to lower-cost generic medicines

While it is true that retail or reimbursed prices for generic pharmaceutical products have been significantly reduced in Canada over the past four years, Canadians are still not fully benefitting from the savings available from lower-cost generic prescription medicines.

Faster generic formulary listings

The discussion paper correctly points out that the current formulary listing process in some provinces can take several months from the time the drug has received Health Canada approval. This delay in listing newly approved lower-cost generic versions results in drug plans paying additional money for a brand-name drug even though a cost-saving generic equivalent is available.

Provincial governments should list lower-cost generic versions on their formularies immediately following Health Canada approval to maximize savings. This should take no longer than one month as in provinces such as Ontario.

Generic drug use: public Sector vs. private sector

The use of generic drugs by provincial drug plans in Canada is considerably higher than generic drug use by private sector payers. According to data from IMS Health and Brogan Consulting, generic drugs are dispensed to fill more than 60 percent of prescriptions paid for by public drug programs but only 47 percent of private sector prescriptions.

Changes to the pricing and reimbursement system for generic drugs and pharmacy compensation implemented by the provinces are lowering retail or reimbursed prices for private sector payers as well. Private payers in Canada must now examine their drug benefit plans to determine why their use of generics is so low and what steps can be taken to increase generic drug use and the related savings.

The discussion paper offers some options for maximizing the use of generic drugs, such as developing appropriate prescribing incentives and protocols, creating more stringent interchangeability laws and tiered formularies. These options and others must be further explored by all payers in Canada to ensure that the most appropriate and cost-effective medicines are being prescribed and dispensed to Canadian patients.

Generic drug use: Quebec vs. the rest of Canada

The Province of Quebec, in particular, is wasting considerable taxpayer dollars by failing to use cost saving generic pharmaceutical products. While generic drugs are dispensed to fill more than 57 percent of prescriptions in the rest of Canada, in Quebec, generics are dispensed to fill only 51 percent.

This discrepancy is due, at least in part, to the Government of Quebec’s “15-Year Rule”. Under this rule, Quebec’s drug plan will pay for the brand-name version of a drug for 15 years after it is listed on the province’s drug plan formulary, even after lower-cost generic drugs become available. According to the Government of Quebec the annual subsidy to brand-name drug companies through the 15-year rule totals more than $161-million.

Furthermore, if the goal of the 15-year rule is to encourage brand-name drug companies to invest in Quebec, it misses the mark entirely.

The 15-year rule provides no advantage to a brand-name drug company that invests in Quebec over a company that invests in any other jurisdiction. They all share $161M annually of Quebec taxpayers’ money. As the latest annual report of the PMPRB shows, brand-name drug companies spend more money on R&D in Ontario than they do in Quebec.

A more efficient way of rewarding pharmaceutical companies that invest in Quebec is to provide an advantage or benefit to companies that actually invest in Quebec. This could be done, for example, by providing some form of tax credit to companies that invest in R&D and pharmaceutical manufacturing in the Province of Quebec.

The other advantage of a more direct policy such as this is that it would equally encourage both brand-name and generic drug companies to invest in Quebec without favouring one side of the industry over the other.

Generic drug use: Canada vs. United States

According to sales data released April 1, 2010 by IMS Health Canada, generic drugs were dispensed to fill 54 percent of all prescriptions in Canada in 2009. In the United States, IMS Health reports that generic drugs are dispensed to fill fully 75 percent of all prescriptions. If generic utilization in Canada increased to levels in the United States, Canadians payers would save an additional $1.6-billion in the first year alone. Given the available savings, it would be beneficial to Canadian payers for the Health Council to further investigate why payers for prescription drugs in the United States are so far ahead of their counterparts here in Canada.

Incentives for generic companies to make the significant investments, and assume the considerable risks, required to bring cost-saving generic drugs to market.

The discussion paper also makes important recommendations regarding incentives for generic pharmaceutical manufacturers to make the significant investments, and bear the considerable risks, required to bring cost-saving generic prescription medicines to market.

The report recognizes that it is beneficial to the health-care system for generic manufacturers to challenge patents and that there must be incentives to encourage generic market entry at the earliest appropriate opportunity. Such litigation results in significant savings for government and private payers.

In the absence of such litigation, brand-name pharmaceutical companies would be encouraged to further exploit the patent system to delay market entry of generic competition, leading to additional expenditures of billions of dollars for prescription medicines. Supplementary patents are becoming extremely common, and the average blockbuster drug in Canada is now protected by many patents.

As the Health Council report notes, such an incentive period for generic companies that successfully invalidate weak and frivolous patents in court to gain market entry is not unique. In the United States, for example, the first generic firm to file an allegation that the brand-name patent is invalid or will not be infringed is granted 180-days of market exclusivity, provided that the generic company prevails in litigation. During the 180-day period, the Food and Drug Administration (FDA) may not approve a subsequent generic competitor.

While it is the view of CGPA that an exclusivity period such as that in the United States may not be appropriate for Canada, an incentive period that rewards generic drug makers for successfully challenging invalid or non-infringed patents to bring cost-saving prescription medicines to market is not only appropriate but a necessity given the price reductions that have occurred in recent years.

In summary, now that the issue of reimbursed or retail prices of generic prescription medicines and pharmacy compensation has, in large part, been addressed in Canada, it is now time for governments, employers, unions, taxpayers and patients to turn their attention to the issue of access. Again, the price of generic drugs does not matter if Canadians do not have access to them. We encourage the Health Council of Canada to expand upon its work on access issues in order to provide further policy options to Canadians for ensuring they maximize the enormous savings opportunities available to them through greater use of cost-saving generic prescription medicines.

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Some of the material on this page is written by guest bloggers. We appreciate their opinions. However, please note that they are not necessarily those of the Health Council of Canada.