December 22, 2017

Pangaea Express: The Patented Medicine Regulations now published in Canada Gazette Part 1

by Marla Weingarten, Consultant

The amendments to the Patented Medicines Regulations have now been published in Canada Gazette Part 1 (CGP1) and the proposed changes are no different as those outlined by the Health Minister last spring.

The Regulations will include data regarding the pharmacoeconomic value as patentees will be required to provide the PMPRB all published cost-utility analyses for all patented medicines including those already on the market. Only published analyses, as prepared by CADTH or INESS would be provided. As outlined last spring, the size of the market will still be a factor that will be used to assess price excessiveness and must be updated if the market size of the medication expands (e.g. approvals for additional indications etc.). No surprise, the US is OUT and the PMPRB7 has now become the PMPRB12 with Australia, Belgium, France, Germany, Italy, Japan, the Netherlands, Norway, South Korea, Spain, Sweden and the UK as the basket of comparator countries. The amendments are also forging ahead with greater transparency in pricing, whereby patentees will be required to report the price net of all Canadian price adjustments either direct or indirect, third party discounts, rebates or any free goods or services.

These amendments are estimated to save Canadians $8.6 billion in net present value (NPV) over 10 years following implementation.

In IMC’s posted response, the association identified the investments the industry has made to R&D at 9.97% of revenues that includes initiatives with Canadian universities, hospitals, and centres of excellence, the $19B the industry generates in economic activity in Canada. While acknowledging the costs of treatments for rare disease, IMC brings to light the fact that these innovative medicines can save the healthcare system through “reduced hospital stays, or in the case of hepatitis C, actually curing what was once a chronic disease.”

Following publication of Canada Gazette, Part II, the PMRPB will develop the Compendium of Policies, Guidelines and Procedures and will hold all responsibility for implementing and enforcing the revised framework. The proposed Regulations will come into force on January 1, 2019.The reporting requirements will be applied to both new and existing patented medicines (ie. cost-utility analysis, estimated market use, price information for the revised PMPRB12 and Canadian price and revenue information taking into account price adjustments) and must be provided within 30 days after June 30, 2019 (30 days after the end of the reporting period in which the proposed amendments came into force).

There will be many repercussions from these amendments, most notably the new transparency legislation that will do away with any confidential agreements. Will the industry terminate all current PLAs? Will provincial governments delist products once the listing agreements cease to exist? What about the roll of the pCPA? Will this alliance need to exist at all if pharma is no longer willing to negotiate a further reduction in price?

For more information, please contact Marla Weingarten, Consultant, The Pangaea Group