Title: The Patented Medicine Prices Review Board and the Review of its Excessive Price Guidelines
1The Patented Medicine Prices Review Board and
the Review of its Excessive Price Guidelines
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- Barbara Ouellet, Executive Director, PMPRB
- 7th Annual Market Access Summit
- December 3, 2008
- Toronto
2Purpose and Scope of Presentation
- Purpose
- Summary and analysis of the Boards Guidelines
review over the last 3 years - Focus
- Key principles and drivers
- Unique approaches
- Evolving nature of the review
- Scope
- Issues
- Stakeholder engagement
- Board involvement
- Next steps
3Governance
- Arms-length agency Health portfolio
- Created in 1987 as consumer protection pillar
of drug patent law reform - Quasi-judicial tribunal
- Unique structure
- Remedial orders provided for in the Patent Act
and enforceable in the Federal Court - Structure and Budget
- 5 part-time members
- 2008-09 Budget 11.5 million 72 employees
4Mandate
- Two-fold mandate
- Regulatory To ensure that prices charged by
patentees ( ex-factory prices) for patented
medicines sold in Canada are not excessive,
thereby protecting consumer interests and
contributing to Canadian health care - Reporting to report on pharmaceutical trends
and on RD spending by pharmaceutical patentees,
thereby contributing to informed decisions and
policy-making - Key principles
- Openness
- Transparency
- Fairness
- Timeliness
- Efficiency
5Legislative Framework
- Patent Act sections 79 to 103
- Pricing factors
- Creation of Guidelines (Ss. 96(4))
- Remedial Powers
- Distribution of excess revenues to provinces and
territories - Patented Medicines Regulations
- Filing requirements and timelines
6Legislative Framework (contd)
- Excessive Price Guidelines
- Transparency and predictability of the price
review process - Not binding on Board or patentee in a hearing
- But, Federal Court ruled Board can use Guidelines
in a hearing for rationale approach or
methodology in considering price factors (ICN
Pharmaceuticals Inc. LEO Pharma Inc.) - Ss. 96(5) of the Act requires that the Board
consult with the F/P/T Health Ministers,
consumers and the pharmaceutical industry
7Impetus for Review of the Excessive Price
Guidelines
- Last major changes made in 1994
- Changing environment
- International developments
- Medicare Part D UK PPRS other developments in
Europe - Canadian developments
- Common Drug Review (CDR) amendments to/new
provincial legislation (Québec Ontario) policy
developments Bill C-51 (amendments to the Food
and Drugs Act, includes progressive licensing and
post-market surveillance) - Developments within the pharmaceutical industry
globalization, mergers, partnerships - Changes in nature of new patented medicines
fewer breakthrough chemicals, more incremental
innovation - New delivery mechanisms
- Targeted therapies (e.g., rare diseases and
personalized medicines) - Third party reports to PMPRB of price increases
8Impetus for Review (contd)
- Need to ensure that Guidelines remain relevant
and appropriate - Concerns expressed in early 2005 especially
regarding - Categorization of new medicines not consistent
with Health Canada's priority review and
inadequate reflection of incremental innovation - Introductory prices seen as cost-driver
- Other issues raised by stakeholders
- Any market
- re-setting (cost science)
- Some issues identified by Board Staff
- One price factor missing (international
therapeutic class comparison) - Principles on which Board created unclear
9Impetus for Review (contd)
- Additional issues
- April 2000 Board clarification on discretion in
inclusion/exclusion of certain customer benefits
in calculation of average (net) price - March 2007 Federal Court of Canada decision
ruled that Board itself could not elect to
exclude certain free goods - Led to further legal scrutiny of interpretation
of the Regulations - January 2008 options to amend the Regulations
- Boards August 18, 2008 Communiqué
- Judicial Review of the Boards Communiqué
10Engagement
- Boards ownership and involvement
- The Guidelines are the Boards
- First in-depth review since 1994 current
Guidelines pre-date all current Members - Visible engagement in the process
- Outreach to stakeholders
- Guidelines are not well know to many potentially
interested parties - Identification of various stakeholder groups,
e.g., consumers, patient advocacy groups, third
party payers - Education
- Guidelines and overall price regulatory regime is
complex and detailed - Variety of tools
- Maximize opportunity to input
- Build and keep momentum
11Challenges
- Need to be clear on the problem / concern
- Varying, often contradictory stakeholder views
- Concepts are important
- Need to drill down into technical, scientific and
economic issues - Length of process means frequent updates /
interactions are essential
12Range of Approaches
- Notice and Comment
- Discussion Papers / Guides
- Written stakeholder submissions
- Multilateral Meetings
- Five across the country
- Bilateral Meetings
- Industry sectors (innovative, biotech, generics),
F/P/T governments, consumer groups, patient
advocacy groups, third party payers
13Range of Approaches (contd)
- Stakeholder Working Groups
- Therapeutic Improvement International
Therapeutic Class Comparison Cost of Making and
Marketing Price Tests - Outreach
- Briefing sessions to stakeholders by Board Staff
- Conference presentations
- Updates in quarterly NEWSletter
- Publications on Web site
- E-Bulletin / Communiqués
14Draft Revised Guidelines, August 20, 2008
- Some issues received broad consensus via the
Working Groups included in the draft revised
Guidelines - 4 new levels of therapeutic improvement (TI)
- Included new set of secondary factors to consider
- Price tests
- Aligned to 4 levels of TI
- More opportunity for price premium as level of TI
increases - Any market on an as needed basis
- International Therapeutic Class Comparison (ITCC)
- Included, but not to be used as a primary test
- Others
- Left for future consideration
- Decision not to make Guidelines too comprehensive
and prescriptive some flexibility for case by
case consideration
15Board Consideration of Submissions on Draft
Revised Guidelines
- 44 submissions received
- Board decided to meet bilaterally with
representatives of the innovative industry (RxD
and biotech) to provide an opportunity to hear
about key issues of concern - At its October meeting, the Board began the
review of submissions and consideration of
changes/additions to the draft Guidelines more
time is required
16Challenges to the August 18, 2008 Communiqué on
Reporting
- August 18 Communiqué
- Mandatory reporting
- All benefits linked to sales transactions
- January 2009 implementation
- Judicial Review of the Communiqué
- Two Pfizer Canada Inc. RxD et al. (17
patentees) - Issues challenging interpretation of Patented
Medicines Regulations, specifically payments to
3rd parties and others (not direct customers) - Expedited hearing being sought
- Given this, the Board is suspending the
requirement to report all benefits for the period
of January 1 to June 30, 2009
17Next Steps
- Conclude Boards review of the Guidelines
- Further ad hoc meetings with the industry and
others likely - Further round of consultation on outstanding
issues or any changes - Final publication of Guidelines coming into
force and transition - Monitor and evaluate
- Overall pharmaceutical environment
- Application and impact of revised Guidelines
- Implement mandatory reporting
- Timeline to be determined based on expedited
Court hearing
18Summary
- Guidelines Review
- Number of complex issues
- Open door for broad stakeholder participation,
and range of issues and views - Opportunity for all stakeholders to develop a
better understanding of overall regime - Direct involvement of the Board
- Significant uptake of stakeholder recommendations
- Engagement Approach
- No previous process
- Critical to reach out and find ways for
meaningful involvement of broad range of
stakeholders - The dialogue was iterative from issue
identification to options to proposed directions
19Summary (contd)
- Way Ahead
- Imperative that the Guidelines continue to be
relevant and appropriate - Periodic updates likely, as needed
- More staff outreach to facilitate understanding
and application of the Guidelines
20- pmprb_at_pmprb-cepmb.gc.ca