PMPRB scrutiny of high-priced drugs increasing

by Leo Almazora14 May 2019

The pharmaceutical industry is seeing increased scrutiny in Canada as the Patented Medicine Prices Review Board (PMPRB) steps up actions to rein in prices for patented drugs.

Based on an internal review of documents that it conducted, Reuters reported that the PMPRB is targeting an increasing number of expensive drugs. “Data show the number of open PMPRB investigations into potentially overpriced drugs has more than doubled since 2013, reaching 122 as of March 2018,” the news provider said.

The PMPRB is a small agency, with a budget of just $15.4 million and approved staff of 83. But its mandate is crucial for Canada as most patented - or generic - prescription drugs in the country are paid for by more than 1,000 public and 100,000 private, employer-sponsored drug plans as well as patients themselves

According to PMPRB Executive Director Douglas Clark, the rise in investigations is more due to pharma firms ratcheting up prices rather than a toughened stance by the agency. And with a national pharmacare program under consideration, it could have expanded power to consider the effectiveness of drugs and what Canadian governments can afford in deciding whether prices are excessive.

Even now, PMPRB is challenging pharma-industry heavyweights. A case in point: Horizon Pharma, which priced its cystic-fibrosis drug Procysbi at $325,000. The condition afflicts about 100 Canadians, who face irreversible kidney damage unless they get treatment.

“The federal approval [of the drug in 2017] essentially elbowed out a far cheaper alternative drug, making it difficult for patients to get,” Reuters said.

In defense of its pricing, Horizon argued that the medication displays superior performance, and that its US$180 million investment in research and development on the drug justified its price. The firm also noted that patients who can’t afford it can get it for free or for a discount.

In January, PMPRB moved to force Horizon to slash Procysbi’s list price by at least 71%. Pointing to a similar alternative drug’s price of $25,000, the regulator said it should set aside its usual guidelines and rely more on international prices as a benchmark.

A recent statement from Horizon contends that the number PMPRB wants it to adopt is “a small fraction of the lowest price in the world.” The matter is still ongoing and could ultimately reach federal court.

One-on-one confrontations with large pharma firms could raise the profile of the regulator and help with the problem of escalating drug prices. But according to University of Toronto professor and pharma policy expert Joel Lexchin, the ultimate cure is a broad approach, such as the one championed by the new proposed regulations.

“We can’t really keep going with these one-offs,” he said. “We need a general policy.”

Despite broad support for a national pharmacare program in Canada, its approval remains up in the air as federal elections are set to proceed in fall. But even assuming the proposals fail, Clark said, the PMPRB can “make the best of what scope we have.”

 

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