Canadian HR Reporter

18 www.hrreporter.com F E A T U R E S S P E C I A L F E A T U R E BENEFITS GUIDE LOWERING DRUG PRICES CHALLENGING PROSPECT August 2019, the federal government released amend- ments to the Patented Medicines Regulations to review how drug prices are set in Canada. The Patented Medicine Prices Review Board (PMPRB) is an independent quasi-judicial body established by Parliament in 1987 under the Patent Act whose mandate includes ensuring that prices charged by pharmaceutical companies for patented drugs sold in Canada are not excessive. However, more than 30 years later, we have come to recognize that these objectives were not met as Canada's drug prices are the third largest among the countries in the Organisation for Economic Co-operation and Development (OECD). Moreover, phar- maceutical companies have signifi- cantly reduced investments in research and development (R&D) in this country. Their R&D-to-sales ratio has set a 30-year low, according to Telus Health. Initially scheduled for July 2020, the implementation of these changes was first delayed until Jan. 1, 2021 and then until July 1, 2021 due to pandemic considerations. Additional consultations were held with a wide range of stakeholders further to the publication of the original guidelines and some changes were adopted. The new guidelines include the following mechanisms: • The PMPRB will benchmark the c urrent prices paid in Canada agains t the prices charged in Australia, Belgium, Japan, the Netherlands, Norway, Spain, the United Kingdom, Sweden, France, Germany and Italy. • The new guidelines include an initial selection process to determine which sions with big pharma to rebuild the Canadian pharmaceutical industry. With the pandemic, the immediate access to drugs has suddenly become a much larger concern for Canadians. Consequently, adding regulations to force down the cost of drugs is more complex than it was before — and harder to achieve. CHRR IN encountered by Canada to obtain the much-needed vaccine doses could partially be due to the direction taken by the federal government in regulating drug costs. In the last few years, prior to the pandemic, requests from pharma- ceutical companies to hold audiences with the prime minister to address government priorities concerning public politics and big pharma objec- tives regarding R&D have been met with a quasi-total silence. This strategy has now completely turned around and the new federal minister of innovations, science and industry has been intensifying discus- Canada's drug prices are the third largest among the OECD and the pandemic has delayed government changes to patented drug prices. With big pharma opposed to the new rules, bringing down prices is no easy task drugs carry the highest risk of exces- sive pricing ("Category I" medi- cines), meaning drugs with a very high annual treatment cost or drugs expected to gain a significant share of the Canadian market. However, several pharmaceutical giants filed a court challenge to prevent these new guidelines from coming into force. They allege that the guidelines would grant the PMPRB the power of setting drug prices, which falls under provincial jurisdiction. They also esti- mate that these changes would lead to an $8.8-billion loss of revenue over the next decade — a huge sum that would not be invested in research and innova- tion, they warn. This legal action by big pharma is supported by organizations such as Cystic Fibrosis Canada, the Canadian Organization for Rare Disorders and the Intellectual Property Owners Association, which fear that the impact of these changes would signifi- cantly reduce the investments and research efforts for the development of new drugs. "No one is more concerned about the price of drugs than the patients them- selves. But the changes proposed by the federal government will ensure that Canadians will be the last patients in developed countries to have access to innovative new treatments that can save and change lives," said Durhane Wong-Rieger, president and executive director of the Canadian Organization for Rare Disorders. The federal government rejects these claims and reiterates that the objective of these new guidelines is to cut billions of dollars from the cost of drugs in Canada. On the COVID-19 front, some opin- ions suggest that difficulties recently Louise Gagné is an account manager at AGA Benefit Solutions in Montreal. For more information, visit www.aga.ca.

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