A Passport to Better Prescription Drug Coverage

A Passport to Better Prescription Drug Coverage

November 23, 2020

Peter Julian’s Private Member’s Bill on pharmacare is DOA. 

It’s noble idea, but, like most things coming from the NDP, it just doesn’t make practical sense.

The NDP Member of Parliament last week introduced Bill C-213, an “Act to Enact the Canada Pharmacare Act”. The purpose of the bill would be to create a universal, single-payer, public pharmacare plan to ensure that all Canadians have prescription drug coverage.

Good so far. But here’s where it sticks: in order to do that, a pharmacare plan would change the way in which we buy medicines in Canada. Instead of each province doing it on their own, as is the case now, a national program would centralize procurement through a national negotiator in hopes of lowering drug prices.

This is a good idea in principle, but good luck getting the provinces to sign on. Provincial support of a plan is tepid. The Bloc Quebecois, as expected, make it clear that they would want Quebec to opt out, but still want to take the cash for the program. Think of how that would sell here in Alberta.

Could a federal government impose a national pharmacare program if it wanted to? Possibly. The Supreme Court has consistently affirmed that healthcare isn't the sole domain of the federal or provincial governments, and that it can be addressed by valid provincial OR federal legislation.

But the current lack of provincial buy-in to a national pharmacare plan would potentially make this a fight that a federal government wouldn’t want to start. Which might explain why the Liberals have left this promise untouched for the past five years.

Here’s maybe another reason. Canada is notoriously bad when it comes to drug shortages, to a large degree because drugs in Canada get purchased by American prescription holders. This is a huge business.

When the Trump administration announced plans to import low cost medicines from Canada, Canadian health experts warned that Canada’s drug supply could face shortages like we’ve never seen before. The President of the Canadian Medical Association went so far as to say that the prospect of additional drug imports from Canada is so dire that “We’ve never been under threat in this way before.”

Trying to further depress the price of medicines in Canada through a national buying program would make those drugs even more attractive to US buyers, making shortages worse than they already are.

On top of increasing chronic shortages, pharmacare could significantly limit patient access to new and innovative medicines. Canada lags in terms of drug availability when compared to other countries. Countries such as Germany, Japan and the United States all introduce, and reimburse for, innovative drugs much quicker than in Canada.

Here, it takes more than 450 days for a new drug to be reimbursable, while that number is only 180 days in the United States. In Germany and Japan, it’s around 100 days for a new drug to be reimbursable. Pharmacare would make this lag worse because drug manufacturers would put Canada at the back of the line in terms of drug roll outs.

Medicines will be made available in the US and elsewhere where profits can recover R&D costs, before launching these medicines in Canada, where margins would be thin. Plus, drug manufacturers won’t negotiate with a Canadian pharmacare plan if low priced drugs from Canada are then ending up in the US. If that trend continues drug manufacturers will just withhold from Canada for a prolonged period of time to ensure that drugs meant for Canada aren’t undercutting their sales in the US.

Supporters of pharmacare might argue that these fears are overblown, but we have already seen in real time that they aren’t. When the federal Liberals proposed, and later enacted, price control rules via the Patented Medicines Prices Review Board (PMPRB) producers responded by pulling drugs out of the Canadian market.

The immunotherapy breast cancer treatment Tecentriq was pulled from review as a direct consequence of those changes. In fact, it is reported that seven drug launches were delayed in response to PMPRB changes. It is more than likely that pharmacare, which is a much larger intervention than PMPRB, will significantly increase that trend of delayed drug launches, which is a huge disservice to Canadian patients.

So what’s the answer? Rather than intervening into provincial territory, the federal government should instead focus on areas of improvement that fall under its jurisdiction.

The federal government could create an auto-recognition program for new drugs that are approved by regulators in other OECD countries. If a drug is available and approved in another OECD country, it should automatically be approved by Health Canada, rather than having to jump through another approval process for the same medicine.

Think of this as a drug approval “passport”. This would help ensure access for Canadians, while reducing operating costs for bringing medicines to Canada, which could help lower prices for patients.

As we’re seeing with COVID tests that are taking too long in Canada even though they’re accepted in Europe and the US, Canada’s health authorities need to up their game in the drug approval process as well.

So let’s allow the Liberals and the NDP prattle away about a national pharmacare program that has about as much chance of arriving on Canadian soil as a unicorn does.

Let’s instead get going on a drug approval “passport” that gives Canadians quicker access the medicines we need right now.


- Rick Peterson


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