April 21, 2015
Let’s discuss what’s new at the PCPA
The moderator for this month’s meeting was Bill Dempster, from 3Sixty Public Affairs, who provided a quick review of what’s happened in the PCPA over the last year. Firstly, Bill pointed out that the PCPA has undergone a name change from the Pan-Canadian Drug Pricing Alliance to the Pan-Canadian Pharmaceutical Alliance. The PCPA negotiates product listing agreements (PLAs) for innovative medications and, to date, they have closed or completed 55 PLAs and another 20 are currently underway. The PCPA also has the Value Price Initiative for generics, capping generic medications at 18% of the innovative reference drug price. In 2013 this initiative came out with its first six medications, another four in 2014 and, in 2015, they plan to cap this initiative at an additional four.
Bill gave an overview of a report done by IBM, which recommended options for innovative medicines and generics. He outlined the common themes from the report (garnered from stakeholder feedback), which were:
- PCPA goals are acceptable
- Single negotiation better than multiple parallel processes, in principle
- PCPA seen as distinct from existing bodies in access continuum
- Subject matter expertise of provincial drug programs critical to success
- Volume limited by resource constraints
- PCPA is young and evolving; needs more structure and more formal, consistent, transparent processes
- Metrics are required to evaluate and benchmark PCPA performance
And finally, Bill outlined the general recommendations from the report, which were:
- Improve communications on negotiation status, benchmark timelines and provide annual reports on performance
- Standardize Letters of Intent (LOIs) and Product Listing Agreements (PLAs)
- Have more flexible contracting processes and identify complex issues early in the process
- Use tiered structure
- Consider pre-negotiation briefings (for complex cases)
- Develop metrics for different parts of the process; possibly include manufacturers
- Secretariat model
Bill introduced the group of panellists for the meeting, the first being Brad Alyward, Manager of Nova Scotia Pharmacare. Nova Scotia will represent one of two lead provinces of the PCPA (the other being Ontario) and is currently working to set up the new PCPA office, which will be housed within the Ontario Ministry of Health. Implementation and transition work is currently underway to refresh the vision and guiding principles of the PCPA, on which the 10 participating jurisdictions will agree. He outlined the PCPA objectives, which are to:
- Increase access to drug treatment options
- Improve consistency of drug listing decisions across the countr
- Capitalize on the combined “buying power” of jurisdictions
- Reduce duplication of negotiations and improve utilization of resources
- Achieve consistent pricing (to address the price discrepancies across the country) and lower drug costs
He also provided some observations and trends:
- Access to existing therapeutic spaces is challenging; want meaningful outcomes and drugs that address unmet needs, as these are the ones that get quick attention, but these types of files are the exception
- Cost-neutral pricing with “positive” recommendation may not be enough; need savings and clarity; late entries into established categories are difficult
- Increased need to coordinate listing decisions with provincial budget cycles
- Patient assistance programs tied to exclusive or “closed” distribution arrangements; be aware of these and make sure they’re brought up early on
François Noël, from the Fernet law firm in Montreal, provided a quick overview of Quebec’s recent proposal to enter into PLAs. In August 2014, Premier Couillard announced that they would enter into the PCPA process and Bill 28 was adopted on April 21st, which would allow the Minister of Health to enter into PLAs and allow Quebec to participate in PLAs in the same manner as other provinces. François pointed out that there are still many questions that need to be addressed, such as:
- How will Quebec be joining the PCPA?
- What will the role of INESSS be if Quebec joins the PCPA?
- Once a Health Technology Assessment (HTA) is done, which agency will be assigned to negotiate with the manufacturer?
- Will private insurers be able to negotiate PLAs?
The last panellist to speak was Ghislain Boudreau, Vice-president of Public Affairs at Pfizer Canada, who provided commentary on the industry’s point of view. Ghislain brought up the patient’s perspective on the PCPA, which is that the process should be about access with minimal delay. He pointed out that there is significant variability in provincial uptake and value is being lost in negotiations, as they seem to be all about price. He said that the PCPA process should be seamless and consistent, which is not currently the case. He also showed some provincial data on the time of Notice of Compliance (NOC) to time to listing: Quebec had the fastest time of 406 days compared to 577 days in Ontario. He felt that these types of metrics should be available on the PCPA website to promote transparency. He concluded with some recommendations, which were:
- All stakeholders need to be engaged and collaborative
- Process needs to be clear; consistent metrics with accountability on both sides
- Letters of intent need to convert to quick listings
The floor was then opened for a Q&A session, which is outlined below.
- Q: Was there any thought given to the impact of the PCPA process in terms of potential distortion that it can create at the HTA level? Comparators’ products may have PLAs in other provinces, so the real price isn’t known; therefore what’s the value of the economic evaluation from the HTA? PCPA is a negotiation, so when we come to the table we expect PCPA to have a price advantage; what’s the potential impact on price inflation?
- Recognize that we are dealing with artificial pricing
- HTA agencies often don’t have complete information; only have the ability to complete “an” evaluation
- PCPA will conduct their analysis based on actual cost of drug plans and sometimes there’s a shock when it comes back to the manufacturer
- Usually the first ask from a PCPA jurisdiction is “why don’t we consider transparent pricing?”; government and payers would prefer transparency
- Q: Has there been any discussion about getting DSEN involved in the PCPA process?
- Not in particular, but it is included as an external stakeholder group and is one of the external touchpoints with whom we need to better communicate
- We need to rely on extremely robust data that represents the totality of the data; Health Canada is a better source
- Q: Bill 28 is open to interpretation. Could PLAs be opened on drugs that are already listed?
- There’s a lot of uncertainty about how Bill 28 and PLAs will be enacted
- Hasn’t been officially specified how it will work for drugs that are already listed