The federal government intends to drastically transform the rules of its tribunal that sets ceiling prices for new drugs and vaccines in Canada in January. Guidelines will be released imminently for how the new price controls will work.
Key elements of the government’s plan have been strongly criticized by patients, drug developers and analysts since it was first announced in 2017. Concerns have increased during the COVID-19 pandemic. Months before implementation, the plan has already blocked access to new important medicines for Canadian patients.
Politicians and government officials have routinely insisted that the price reductions resulting from these changes will not increase the regulatory burden on drug developers nor impact patient access to medicines. Only recently, responding to a letter to the Health Minister from a patient group, an anonymous official wrote “even with lower prices, Health Canada maintains that Canada will remain an important pharmaceutical market and … new drug launches will continue growing over the next ten years.”
Repeating talking points is head-in-the-sand posturing as evidence to the contrary grows. Case studies have shown that the new rules can require manufacturers to reduce prices to unsustainable levels. Most importantly, clinical trials funded by drug developers and the number of new drugs approved in Canada have decreased dramatically.
However, on September 17, Ottawa announced a special policy to decrease the same tribunal’s scrutiny of COVID-19 vaccines and medicines, such as remdesivir, as part of a “government wide effort to provisionally ease the regulatory pathway” for COVID-19 therapeutics. Manufacturers will be able to provide these products at their own list prices unless the pricing tribunal receives a complaint from any federal or provincial minister of health. It is good that Ottawa has started to appreciate that elements of the pricing revisions are a heavy regulatory burden on drug developers and a barrier to meeting patients’ needs.
COVID-19 is obviously a major health risk to all Canadians. By September 30, close to 160,000 had been infected and over 9,000 had died. These are large numbers, but over 80,000 Canadians die from cancers and more than 70,000 die from cardiovascular disease every year. Although not always as effective as we would wish, many drugs are available in Canada to treat cancers and cardiovascular diseases.
For other disorders causing suffering, premature death and/or life-limiting disabilities, no treatment exists beyond palliative care. For some of these disorders, new breakthrough therapies – often developed as a result of science’s greater understanding of human genetics – are available or soon will be. Many of these medicines are expensive and may require life-time treatment.
Lip service notwithstanding, innovative advances are commonly undervalued in Canada. New medicines are no exception. Canada is presently a commercially viable market for new medicines and vaccines, despite the barriers created by federal and provincial governments that limit, delay or deny access to new drugs, especially costly ones. However, the new federal price controls will prevent many new medicines from coming to Canada at all. Canadians with rare disorders will be particularly impacted.
For example, a drug called Trikafta for people with cystic fibrosis highlights hypocrisy in government policies. Trikafta can transform and save the lives of 90 percent of the 4,400 Canadians with this rare, fatal lung disease, who are especially vulnerable to COVID-19. Approved in the United States a year ago, its developer has not applied to sell it in Canada due, as the developer and patients have made clear, to uncertainty around the new pricing rules. Governments of other nations negotiated price deals for Trikafta before it was approved for sale, but Ottawa refuses to acknowledge the new pricing rules as the issue or to work with the developer to resolve it.
Trikafta is not the only new medicine where manufacturers are taking a wait-and-see approach. Since the regulations were finalized in August 2019, a growing list of medicines have been approved in the United States but not submitted to Health Canada for evaluation. These include therapies for neuromuscular diseases, Parkinson’s, sickle cell disease, spinal muscular atrophy, and a range of cancers.
Prime Minister Trudeau often talks about protecting Canadians. This is hard to trust when his government adds red tape that will decrease Canada’s attractiveness as a place to perform research and launch new medicines that will reduce Canadians’ suffering and extend lives.
Ottawa has begun to recognize the side effects of the planned changes. However, it is only for COVID-19 therapies. Furthermore, the federal Health Minister recently told Hill Times Research that she is not open to delaying the new pricing rules and manufacturers should negotiate with the price control agency. The impracticality of negotiating with a quasi-judicial tribunal wielding the power of law under complicated and unproven rules for a small market, like Canada’s, seems to have escaped the Health Minister.
The pandemic has again demonstrated that our health care system is a limited and fragile resource. Drugs contribute to the sustainability of the health system and to patients’ lives. The federal government should recognize the value of other innovative life-changing medicines and implement rational policies that allow Canadians to benefit from these technological advances and that promote research and development in Canada. To do otherwise is hypocritical.
Nigel Rawson is an independent researcher and affiliate scholar with the Canadian Health Policy Institute. John Adams is cofounder and CEO of Canadian PKU and Allied Disorders Inc. and volunteer board chair of the Best Medicines Coalition.