Assessing the impact of government policies, reforms on private payers

With governments having announced a number of changes related to pharmaceutical policy, plan sponsors are facing a shifting environment for their drug plans.

“There are a lot of things happening today in the world of pharmaceuticals, drug plans, benefit plans, pricing, reimbursement and access to drugs,” said Wayne Critchley, senior associate for the health and life sciences practice at Global Public Affairs, during his presentation at the recent Face to Face Drug Plan Management forum in Vancouver.

“The changing nature of the pharmaceutical sector is a key issue for public and private payers.”

Read: From pharmacare to PMPRB reforms: The changing landscape for private plans

Among the developments are changes on the technology side. “With huge advances in technology, we see promises for precision medicine, personalized medicine, development of specialized treatments for rare diseases and other conditions that have not been treated in the past,” said Critchley.

“But these therapies are coming to market at a fairly high cost, and that creates concerns for both public and private payers about sustainability of programs and the ability to predict the requirements for the budgets they have. All payers are looking for ways to manage this changing nature of the sector.”

The federal government’s pharmaceutical policy goals focus on the three As: affordability, accessibility, and appropriate use. The 2017 federal budget included an investment of $140.3 million over five years for Health Canada, the Patented Medicine Prices Review Board and the Canadian Agency for Drugs and Technologies in Health (CADTH) to improve access to prescription medications, lower drug prices and support appropriate prescribing.

Read: Panel discussion: Hot topics in drug plan management

As well as a commitment to modernizing Health Canada’s regulatory role, the government wants greater collaboration between the federal department, CADTH and the Institut national d’excellence en santé et en services sociaux (the Quebec counterpart to CADTH). The idea is to provide more timely access to innovative devices and drugs, including biosimilars and generics. Major reforms to the Patented Medicine Prices Review Board are part of an effort to reduce drug prices. “However, the PMPRB reforms have proven to be very controversial, especially the plan to introduce economic price factors, including pharmacoeconomics,” said Critchley.

“There is no agreement on what the impact of price reforms will be, but it is expected to be significant.”

Last summer, the Council of the Federation reiterated its intention to work collaboratively to further reduce drug prices through the pan-Canadian Pharmaceutical Alliance. As well, the group called on the federal government to discuss establishing a national pharmacare plan.

Read: Breaking down the cost drivers: Deep dive shows 4.9% predicted rise for drug plans over three years

In announcing the 2018 federal budget, the government moved to appoint Dr. Eric Hoskins, a former Ontario health minister, to provide independent advice on “how to best implement national pharmacare in a manner that is affordable for Canadians and their families, employers and governments.” In the meantime, the House of Commons’ standing committee on health released its final report on how pharmacare could produce savings while ensuring prescription medicine coverage for all Canadians. Noted the fact that various stakeholders in the public and private sectors have differing views on how pharmacare should work, Critchley said to expect a rigorous debate over the next year or so.

Read more coverage from the 2018 Face to Face Drug Plan Management forum Vancouver.