The Canadian pharmaceutical market access environment can be quite complex at first blush. There are many agencies, organizations, and bodies to conform with along with a myriad of legislative bills and protocols to understand. This will be the first of many blogs that Impetus will create to help demystify this complex ecosystem in Canada. Our first topic will be to discuss the Quebec environment as it does stand relatively “distinct” in its practices and policies. The objective of this article is to give a background on all of the recent healthcare changes in Quebec and also to provide some innovative ways that manufacturers can navigate the complexity and confusion that lies ahead.
First, a little bit of history. In Jan 1997, the basic prescription drug insurance plan (Régime général d’assurance médicament, RGAM) was established with the objective of providing reasonable and fair patient access to drugs in Quebec. Coverage that is provided by the RGAM is defined by the Quebec Drug Formulary (Liste de médicaments). Drugs that are covered fall under the following 3 key categories a) General Coverage, b) Drug Exceptions (Médicament d’exception) and c) Patient Exceptions (Patient d’exception). The Régie de l’assurance maladie du Québec (RAMQ) was then subsequently established to manage and administer the Quebec Drug Formulary.
In November 2006, Philippe Couillard, the Quebec Minister of Health at the time, introduced the Quebec Drug Policy to the province. In February 2007, the bill came into full effect with the intent to deliver on the following key objectives:
- Ensure equitable patient access to pharmaceutical drugs
- Establish fair and reasonable prices for drugs
- Promote optimal use of drugs
- Maintain a dynamic pharmaceutical industry in Quebec
The following regulations were proposed but were never properly implemented:
- Drug Exception plan with appropriate follow up
- Financial risk sharing agreements with drug manufacturers
- Equitable drug prices for both private and public payers
In January 2011, INESSS and AETMIS were created (Conseil du Médicament and the Agence d’Évaluation des Technologies et des Modes d’Interventions en Santé). INESSS was established to work as an independent advisor to the Ministry of Health and had been set up as a Health Technology Assessment (HTA) organization. They work separately from the RAMQ which also reports directly to the Minister of Health and functions similarly to the pan-Canadian Pharmaceutical Association (pCPA). INESSS’ role is to establish drug therapeutic value, set fair pricing, evaluate drug cost effectiveness, evaluate impact of drugs on the healthcare system as a whole as well as to make recommendations for listing on the public drug formulary.
According to the MSSS (RAMQ Stats, 2016), 44% of the Quebec population is covered by the public purse while 56% are either covered by private insurance or are cash payers. The cost of prescription drugs in Quebec has now reached nearly $7.7B (both public and private) which represents 17% of the their total healthcare budget. This is noticeably higher than the rest of Canada which tracks at approximately 13%. One of the reasons for this is that Quebec has not been as diligent as they had hoped with reviewing older drugs on their public formulary or in monitoring special authorizations for exceptional drugs or patients. In addition, Quebec has not been as conscientious as the rest of Canada in negotiating Product Listing Agreements, and hence, have not always benefited from the best prices possible. Because of these issues, there has always been huge disparities between list prices (what private drug plans and cash payers are paying for drugs) and what the public formulary is paying. Since Quebec pharmacists charge more to private insurers, employers are paying approximately $550M/year more than the public formulary to compensate for additional pharmacist fees. As a result, there have been a myriad of bills passed in the last few years to help promote healthcare reform and rein in costs within Quebec. Here is a summary of a few of the bills which have or will directly affect the pharmaceutical industry:
This bill was introduced to the National Assembly in Sept, 2014 and was passed in early 2015. Its objective is to consolidate the health and social service facilities across the province under the establishment entitled the Centre intégré de santé et services sociaux (CISSS). Their aim is to improve the patient journey, improve data sharing and reduce costs in upwards of $200M/year. The bill abolished many individual health organizations and merged them into 28 regional boards.
Passed in Apr 2015, the Quebec Act pertaining to Prescription Drug Insurance was amended. The first change was the elimination of the minimum reimbursement clause (set to 66% since July 2015) affecting private drug insurance companies. Private plans will now have to limit the reimbursement of drugs to what is considered eligible under the contract (most often the generic equivalent) and any excess (out of pocket costs) will have to be billed to patients directly. This bill, in effect, enforces Generic Substitution and limits the Reasonable and Customary (R&C) fees paid to pharmacists. Some pharmacists have been trying to pass the extra fees down so patients are encouraged to compare fees between pharmacies. Finally, the bill incorporates changes to the annual co-pay maximum (out of pocket maximum) for private plans. The New Pharmacists Act has entitled pharmacists to offer seven new pharmaceutical services, four of which are billable acts for private plans: extending physician prescriptions by 30 days, scheduling patient follow ups, prescribing medications for minor conditions and prescribing medication when no diagnosis is needed such as smoking cessation.
Minister Gaetan Barrette’s third controversial bill was passed in Nov 2015. The new law ended the coverage of IVF and replaced it with a system of tax credits based on family income. It also described the auxiliary fees doctors could charge in order to curb abusive practices. The bill was also passed to ensure that patients will not have to wait more than 3 days to see a family physician and that 85% of Quebecers who are presently without a family doctor will be able to secure one before the end of 2017.
Passed in June 2016, this bill introduced a tender process into the mix for drugs and distributors. The first proposal suggests that manufacturers bid on tenders. This will allow the Health Minister to adjudicate contracts to include up to 3 manufacturers per contract where each would be assigned a specific allowable “market share”. The second type would be fixed price tenders, again, set by the Health Minister. All eligible manufacturers who comply with the set price caps could be included in the contracts made available in the formulary. Similar tender suggestions are also being considered for wholesalers although it is still not clear if exclusive distribution will be allowed by single wholesalers or not.
Proposed in May 2016, this bill attempts to extend the powers of the Régie de l’Assurance Maladie du Québec and to amend various legislative provisions. The bill proposes that no manufacturer may enter into an exclusive procurement agreement with a wholesaler or intermediary for any drug listed on the public formulary. It also suggests that no manufacturer, wholesaler or intermediary may a) pay or reimburse the price of a drug, in whole or in part, b)limit supply of drugs to a few pharmacy owners, c) require that a pharmacy owner buy drugs directly from the manufacturer or wholesaler or d) directly of indirectly encourage or force a pharmacy owner to sell a particular brand of listed drugs or provide them with incentives to sell a particular drug. In addition, the bill allows the RAMQ to set the conditions for the reimbursement of drugs listed on the Quebec public formulary and for INESSS to recommend how each drug should be used optimally. They will also be able to make recommendations if a manufacturer’s drug be delisted or suspended if they do not meet the required RAMQ pricing and there is a generic substitute available in the market. All of these changes will have a significant impact on the future of patient assistance programs, co-pay cards , private infusion clinics, formulary delistings and pharmacist professional fees (pharmacists must now provide detailed invoices to payers).
In efforts to save budget dollars, the Quebec government abolished the BAP-15 rule in Jan 2013 and put a price freeze mandate on drugs in April of that same year. In 2015, restrictions were added on conditions for the use of “no substitutions” and Quebec joined the pCPA in order that they too benefit from the PLA negotiations with manufacturers (looking for 18-25% reductions in branded drug costs). Quebec has aligned with the pCPA’s policy on biosimiliars and will preferentially restrict reimbursement for branded biologics.
New frameworks have recently been established around evaluations in Quebec for Pre-Notice of Compliance evaluations. Drugs now need to be indicated for serious health conditions, must significantly improve health when compared to standard treatments and will only be generated on average in 180 days for oncology drugs and 90 days for all other drugs. Final amendments to the pre-NOC framework is expected in Q2 2017 and manufacturer submission fees in Q3 2017.
Unfortunately, there is not a lot of additional funding being added to the Quebec healthcare system to manage the burgeoning costs of new and exciting drugs entering into the market as the Quebec government plans to use the budget surplus from all the healthcare reforms (approx. $278B) to reduce the province’s debt. This leaves a tenuous future ahead for many manufacturers on the fate of their drugs, both old and new.
Fortunately Impetus Digital can assist many manufacturers with establishing an advisory board platform, leveraging the expertise of select stakeholders, to give timely and expert advice on best options to maneuver through the present uncertainty. Stakeholders can include ex-payers, Quebec or national market experts, physicians, pharmacists, wholesalers, intermediaries, private insurance company representatives, and patients. Enrolled advisors can be engaged through a series of online touchpoints either in the form of web meetings or online asynchronous assignments delivered as web form questions, discussion forums or annotation exercises. Through these series of advisor online touchpoints, manufacturers can solicit feedback on their regulatory and market access strategies as well as gain insights on how to navigate around generics and biosimilars entering the market, potential drug-delisting and price competition. They can also develop new strategies with their advisors on how to manage the loss of co-pay cards and pharmacy, private drug infusion center, and wholesaler incentivization. In addition, manufacturers can leverage virtual working groups to help develop clinical papers leveraging real world data, medical education materials, press releases and patient advocacy programs. Finally, virtual advisory boards or working groups can be utilized to bolster Quebec new drug submission dossiers and/or RAMQ/INESS submissions, pricing/PLA negotiations, and rebuttals.
The virtual nature of the boards and working groups can help to increase the engagement rates of advisors who are often extremely busy and being utilized by multiple manufacturers for similar purposes. Also, the assignments, which are compelling, relevant, and timely, can give the advisors or steering committee members time to pause, reflect, process, and review their colleague’s comments on their own time, allowing for more thoughtful and granular insights shared through the online forums. All of the assignments are created, programmed, project managed, and reported out by Impetus and their technical team (market access subject matter experts); hence, the manufacturer’s workload is minimal and so are the costs when compared to more traditional in-person consultancy meetings.