ARCHIVED - Patented Medicine Prices Review Board

• Previous Page
• Table of Contents
• Next Page

This page has been archived.

Section 2 — Analysis of Program Activities by Strategic Outcome

Strategic Outcome

The Patented Medicine Prices Review Board (PMPRB) has one strategic outcome: Canadians and their health care system are protected from excessive pricing for patented medicines sold in Canada and are informed on pharmaceutical trends.

The performance indicator for the strategic outcome is: Canada's prices on average are in line with the seven comparator countries listed in the Regulations.

The target for the strategic outcome is: Canada's prices on average are at or below the median of international prices.

The strategic outcome is supported by two Program Activities:

1. Compliance and enforcement of non-excessive prices for patented medicines;
2. Pharmaceutical trends.

Program Activities

Program Activity 1: Compliance and enforcement of non-excessive pricing for patented medicines
2008-2009 Financial Resources ($ thousands)			2008-2009 Human Resources (FTEs)
Planned Spending	Total Authorities	Actual Spending	Planned	Actual	Difference
$3,194.0	$7,955.0	$5,263.1	25.5	33.0	(7.5)

 

Expected Results	Performance Indicators	Targets	Performance Status	Performance Summary
Prices charged by patentees for patented medicines in Canada are not excessive according to the factors of the Patent Act.	Percentage of patented medicines that are within the Guidelines	95% of patented medicines are within Guidelines.	Mostly met	87% of all patented drugs under the Board's jurisdiction had prices that were within the Guidelines.

Benefits for Canadians

Ensuring that the average net prices of patented drugs sold in Canada are not excessive contributes to the protection of the interests of Canadians and the Canadian health care system.

Performance Analysis

In 2008, Board Staff completed the review of the prices of 99% of patented drug products sold in Canada to determine conformity with the Board's Excessive Price Guidelines. Of the 1,260 patented drug products under the Board's jurisdiction, the prices of 87% were not excessive, 10% were under investigation, 2% were before a Board hearing, and 1% were under review. The overall level of compliance with the Board's Guidelines has been declining in recent years (down from 95% in 2003 and 2004). As a result, the number of price investigations and hearings has risen. For example, between January 1, 2008 and March 31, 2009, the PMPRB issued five Notices of Hearing. In the same period, nine Voluntary Compliance Undertakings (VCU)² were approved, two of which involved drug products that had been the subject of a Notice of Hearing.

Given that the Board's Excessive Price Guidelines are the main tool to communicate the Board's interpretation of the appropriate approach and methodology to give effect to its statutory mandate, the exercise to review the Guidelines has been critical. Following extensive and iterative input from all key stakeholders and detailed deliberations by the Board, the revised Guidelines (released in June 2009, to be implemented on January 1, 2010) provide more clarity and transparency on the review process and create the potential for flexibility in unique situations likely to arise in today's pharmaceutical environment. The PMPRB will undertake an evaluation of the application and impact of the changes made to the Guidelines. It is hoped that, in the longer term, patentees will increase their compliance with the Guidelines.

Lessons Learned

Patentees' willingness and ability to comply with the Board's Excessive Price Guidelines are influenced by the larger pharmaceutical and industrial environment. The PMPRB noted, as part of its Guidelines review, that there have been fewer breakthrough/blockbuster new drugs in recent years, with instead an increasing trend toward incremental innovation that may not increase efficacy but may provide other benefits. There has also been a trend toward more globalization in drug pricing. Many of these recent developments were the subject of extensive discussion and stakeholder input as part of the Guidelines review. The Board believes that the revised Guidelines are more appropriate in that they recognize some of these recent trends but also anticipate a range of drug product pricing situations.

Program Activity 2: Pharmaceutical trends
2008-2009 Financial Resources ($ thousands)			2008-2009 Human Resources (FTEs)
Planned Spending	Total Authorities	Actual Spending	Planned	Actual	Difference
$2,648.0	$3,204.6	$2,787.1	20.5	16.0	4.5

 

Expected Results	Performance Indicators	Targets	Performance Status*	Performance Summary
Stakeholders are more aware of pharmaceutical trends and cost drivers.	Number of requests for PMPRB publications Number of events where the PMPRB participates	95% increase in requests over previous year 10 events per year	Mostly Met Met All	The number of requests for PMPRB publications has remained relatively stable over the last few years. The PMPRB participated in 14 external events.

Benefits for Canadians

The PMPRB's critical analysis of price, utilization and cost trends, under the National Prescription Drug Utilization Information System (NPDUIS), is primarily directed toward assisting participating public drug plan managers (all jurisdictions participate except Quebec) in anticipating and managing drug costs and in designing their drug plan policies. With the PMPRB providing a centralized, credible analytical capacity, individual plan managers can benefit from high quality studies while at the same time minimizing the duplication of work across jurisdictions.

Performance Analysis

The number of requests for PMPRB publications has remained relatively stable over the last few years. However, the PMPRB has focused its efforts on increasing the visibility of its Web site, where all of its publications are posted, and on subscriptions to its E-Bulletin. Also, in the context of the Board's review of its Excessive Price Guidelines, more regular exchanges with all stakeholder sectors/groups has increased the visibility and public awareness of the PMPRB itself, which has impacted activities on the Web site.

In 2008-2009, the PMPRB participated in 14 external events. In addition to presenting at two international conferences, the PMPRB addressed a variety of audiences, including patentees, provinces and territories, third party payers, patient advocacy groups and foreign delegations, to name a few.

Lessons Learned

Clearly, with the exception of the PMPRB's Annual Report, stakeholders are increasingly choosing to access the Board's Web site to get the information they need. As a result, requests for actual publications are expected to remain stable or even decrease in the coming years. The PMPRB will revisit the appropriateness and usefulness of the Performance Indicators and Targets for the Expected Result under this Program Activity.

• Previous Page
• Table of Contents
• Next Page