The great pharmacare debate: An ‘overly simplistic’ solution or needed system rationalization?

Universal pharmacare is an “overly simplistic” solution that risks cutting access to drugs, says a senior executive at one of Canada’s largest pharmaceutical companies.

“It sounds like a lovely solution,” Julia Brown, vice-president of government affairs and market access at Janssen Inc., told the audience at Benefits Canada’s 2017 Face-to-Face Drug Plan Management Forum. But it is “overly simplistic in its approach to what is a very complex health-care, drug reimbursement and patient environment,” she added.

But on the same panel, public policy professor Marc-André Gagnon countered that a consistent national formulary was a crucial component of a new system for pricing drugs.

Read: From biosimilars to PLAs: Panel addresses hot topics in drug plan management

“Universal pharmacare is not a panacea,” said Gagnon, an associate professor on the faulty of Carleton University’s school of public policy and administration. But it would reduce labour costs and increase the competitiveness of Canadian businesses, he argued.

“And it would finally allow Canada to stop being a model of waste and inefficiency when it comes to drug coverage,” Gagnon added.

A recent report by Canada’s parliamentary budget officer pegged the potential savings from a national single-payer system for prescription medications at $4.2 billion, but Brown insisted the report was flawed in that it underestimated the value of rebates and savings achieved during negotiations with the pan-Canadian Pharmaceutical Alliance.

“You can’t achieve the savings and do what’s being proposed in those reports without minimizing the drugs that are available to Canadians,” said Brown. “I don’t think that’s sustainable.”

“There is a very important role for the private insurance industry to continue to play in this country with respect to drug reimbursement,” she added.

Read: Options for getting the best value from drug plan spending

However, Jean-Michel Lavoie, assistant vice-president for group benefits at Sun Life Financial, noted his concerns about the status quo. “It’s not sustainable,” he said. “We need an electric shock of some sort.”

Lavoie said many employers still want to provide health-care and drug coverage as part of their benefits packages but are unsure about whether they can continue to afford it. He said Sun Life would like to see discussions about a version of pharmacare that mandates a base level of drug coverage and covers high-cost medicines for catastrophic needs through a national plan.

That combination would provide access to catastrophic drug coverage for all Canadians — irrelevant of income, employment, and location — and would allow private plans to continue to offer additional coverage not available elsewhere while “reducing some of the uncertainty and discrepancies happening at the private and public level,” he said.

Suzanne McGurn, assistant deputy minister in charge of public drug programs at Ontario’s Ministry of Health and Long-Term Care, said that while there’s no “silver bullet” when it comes to paying for drug coverage, the multitude of parties involved in the current system leaves plenty of room for improving efficiency.

“I do think we want a system where, whatever the level of minimum access of medicines, it is as similar as possible across the country so that people aren’t making choices about where to live based on their access to drug coverage,” added McGurn, emphasizing that she was speaking on her own behalf rather than for the provincial government.

Read: Private plans to see drug costs rise by 6.1% annually over next five years

Durhane Wong-Rieger, president and chief executive officer of the Canadian Organization for Rare Disorders, said she was confident universal pharmacare would eventually arrive in Canada.

“We have to get to a solution that will provide equitable access for everybody. Our fear is that the kind of equity will be the same kind of thing that is happening in terms of rare disease today, which is that if you don’t happen to be in the majority — you don’t have a common disorder — and if you don’t have something that is easily diagnosed and easily treated, you’re going to get left behind,” said Wong-Rieger.

“That’s where the private insurers have been so important for us,” she added.

Read more stories from the Face to Face Drug Plan Management Forum