While the last step of the drug development and approval process in Canada and BC, the pan-Canadian Pharmaceutical Alliance (pCPA) negotiations, is taking place for three new hepatitis C treatments (Sunvepra, Technivie, and Zepatier), there is still a larger discussion going on that is “…exploring the need for a national formulary…”. (CMAJ, May 16, 2016)^
A formulary is a health insurance provider’s official list of pharmaceutical drugs that they have approved for coverage. (Merriam-Webster Dictionary)
The Pan-Canadian Pharmaceutical Alliance (pCPA) and the Current System of Individual Provincial / Territorial Drug Formularies
Steps Towards Listing a Treatment
Currently, within the Canadian drug approval process, Health Canada first evaluates a drug’s safety, effectiveness, and how it’s made.
After this, a Common Drug Review (CDR) by the Canadian Agency for Drugs and Technologies in Health (CADTH) then assesses the drug’s clinical and cost-effectiveness as it compares to other treatments.
Thirdly, according to the pan-Canadian Pharmaceutical Alliance (pCPA)’s website, once a CDR is complete, individual provinces/territories may then negotiate with the manufacturer without pCPA or, if the pCPA steps in after deciding that joint pan-Canadian negotiations for the drug will occur, provinces/territories may negotiate collectively.* This happens about 80% of the time. (CMAJ, May 16, 2016)
A province/territory then assumes the lead in the pCPA negotiations, contacts the manufacturer, and starts negotiations. If an agreement about treatment prices is reached, the lead province, the manufacturer, and the other provinces/territories negotiating sign a Letter of Intent. The Letter of Intent ends the pCPA’s involvement in the drug’s approval process.
After a Letter of Intent is signed, the participating jurisdictions will work with the manufacturer on their individual Product Listing Agreement (PLA), or work on a translation of the terms agreed to in the Letter of Intent. This translation is not a second negotiation. After this, the treatment is then listed.
When Negotiations Fail to Reach an Agreement
However, if negotiations are closed without reaching an agreement, as recently happened with Daklinza (daclatasvir), a treatment for those infected with hep C genotype 1, 2, or 3, provinces/territories involved in the pCPA negotiations can not restart negotiations with the manufacturer on their own.
Once pCPA negotiations are closed, future requests by the provinces/territories for re-consideration start with the treatment’s file being resubmitted to pCPA for further review through their office. In the future, if a manufacture believes that it is “able to provide the value needed by the jurisdictions”**, the manufacturer can also submit an unsolicited offer to the pCPA office and possibly restart negotiations that way. When this happens, provinces/territories are not bound to re-enter pCPA negotiations for the treatment.**
The Current Discussion about Changing the System of Provincial / Territorial Drug Formularies to a National Formulary
Currently, there is talk about changing the system of provincial/territorial drug formularies into a more national pharmacare system. The below are recent articles and videos about this discussion:
- Consensus Mounts for National Drug Formulary by the Canadian Medical Association Journal
- Pricing of Hepatitis C Medicines in Canada: AHC Postition Statement by Action Hepatitis Canada
- Pan-Canadian PharmaCare: Rallying the HIV and Hepatitis C Communities for Equitable and Timely Access to Treatment by CTAC
- Approval and Public Listing of Drugs in Canada – The Common Drug Review by CTAC (This is a quick summary of the current drug approval process)
- Health ministers agree to tackle drug prices, home care and mental health by CBC
*The pCPA also negotiates for military and RCMP employees, First Nations and Inuit people. It is estimated that the pCPA has saved $490 million since 2010. (CMAJ, May 16, 2016)
**The source of this information was a requested email from the Pan-Canadian Pharmaceutical Alliance and the links within this post.
^Some of this post was originally published in May 2016. As there are now three hepatitis C treatments being examined by pCPA, instead of two, we believed that the subject matter was important and current enough to publish it again.