Health Committee on May 30th, 2016

[The Chair, Liberal, Bill Casey]

It being 3:30, I will call the meeting to order.

First of all, I want to thank our presenters for coming back. I know you were cancelled before, and I was afraid you were going to be cancelled again today. The votes tonight aren't until about 6:30, I think, but I apologize for that. We feel badly when we have to do that.

We very much appreciate your coming back and we are looking forward to your presentations. We feel that the information you will provide today will perhaps be some of the most important information we're going to get.

With that, each presenter has 10 minutes to start. In our first round of questions, the questioners have seven minutes each, and in the second round they have five minutes. If you could keep your presentation to 10 minutes, we'd appreciate it very much.

We're talking about a national pharmacare program. Anything you can put in that light would be most important to us. We're interested in hearing from you.

The Canadian Organization for Rare Disorders can go first.

[Dr. Durhane Wong-Rieger, President and Chief Executive Officer, Canadian Organization for Rare Disorders]

Thank you very much.

My name is Durhane Wong-Rieger, and I am the president of the Canadian Organization for Rare Disorders. Presenting with me today will be Maureen Smith, the secretary of our board.

On behalf of the three million Canadians who suffer from a rare disorder, we want to thank you for the invitation to share our perspectives on national pharmacare with a focus on rare diseases. We're mainly going to talk about the regulatory aspects, and about access gaps for rare disease patients, and some of the key aspects of a national pharmacare program.

Before we start, I'd like to give you a brief background on the Canadian Organization for Rare Disorders, also known as CORD, and to share with you a bit of our personal experiences related to rare diseases.

CORD is a registered charity. It serves as an umbrella organization for about a hundred rare disease groups in Canada. Most of these groups are kitchen table organizations run by volunteers. Most of them are run by people who are not only affected patients or parents, but also hold down other jobs in order to pay the rent. I want to stress this point in order to correct some of the erroneous impressions, which have been fuelled by some of the media outlets and by critics, that these volunteer organizations are heavily subsidized by the pharmaceutical industry. These allegations are not only unfair and untrue, they're harmful and hurtful to the patients and families who donate thousands of hours and thousands of their own dollars to running these groups for their cause.

In the same regard, at CORD we are even more challenged in terms of resources because we don't want to fundraise among our member groups. We can't do the fundraising there. Unlike academic institutions, we can't even apply for a grants from institutes like CHR, even though we at CORD contribute to the research programs.

Our two main sources of funds are educational programs that we run and our educational conferences and grants that we get. Most of them are provided by the pharmaceutical companies, but to put it in perspective, CORD is a lean organization. We only have two part-time staff, and I'm one of them. This is CORD, and we rely heavily on volunteers like Maureen Smith in order to do our work.

Our recent efforts, as some of you know, have included implementing Canada's rare disease strategy, because rare disease is about a lot more than just drugs. This strategy was developed and led by CORD, but we had input from patients, clinicians, researchers, policy leaders, and the private sector. We have five key goals: improving early detection and prevention, because if we can diagnose it early then we can prevent many of the harmful effects; providing timely, equitable, and evidence-informed care; enhancing community support at all levels; providing sustainable access to promising therapies; and promoting innovative research.

As an aside, I'd like to thank all the members of Parliament who wore the yellow scarves for the launch of our strategy for Rare Disease Day.

I don't usually talk about my personal experiences, but I have two children, both of whom were born with rare diseases. I have a husband who has a genetic cardiovascular disease called familial hyperglycemia. He also has Parkinson's disease, and he has a rare motility disorder.

I am a psychologist by training and taught at a university for almost 30 years. During that time, I was doing a lot of patient advocacy on the side. It was my experience working as a volunteer with the Hemophilia Society during the tainted blood crisis that convinced me that I could probably do more good by leaving the university and focusing on patient advocacy full time. I imagine a lot of you can relate to that, because I'm sure you have left other careers to have a bigger impact as a public official.

I'm going to turn it over to Maureen, our board secretary and a board member, to share her story.

[Maureen Smith, Board Secretary, Canadian Organization for Rare Disorders]

Thank you, Durhane.

As a Canadian with a rare disease called congenital panhypopituitarism, I thank you for giving me an opportunity to testify before you today to discuss issues that are important to me.

My health deteriorated for 20 years because no research was being done on my condition, which is extremely rare. However, there was a drug approved by Health Canada that could have helped me. But the cost of the medication could not be refunded through insurance plans in my case, as there were no clinical trials on my specific condition.

During that time, I was monitored by numerous specialists and had to be frequently hospitalized. Finally, after more than 20 years, I was able to participate in a clinical trial and gain access to medications. I am now healthier. Unfortunately, my experience, which has been marked by significant difficulties in accessing treatments, is typical of what other Canadians with rare diseases are going through.

Should Canadians with rare diseases have to wait 20 years to gain access to the appropriate treatments and care people with common diseases take for granted?

I think it is time to implement policies and measures to improve the quality of care and treatments available to Canadians with rare diseases. Dr. Wong-Rieger will have some recommendations for you.

[Dr. Durhane Wong-Rieger]

Thank you very much, Maureen.

Let me continue by talking about our regulatory process and how it could be improved to facilitate access to orphan drugs.

I think Maureen's predicament stems from the fact that Canada is still the only developed country without an orphan drug policy. The biggest downside of that is that companies are not motivated to conduct clinical trials here in Canada. The U.S. passed an orphan drug act back in 1983, the European Union followed suit in about 2000, and other countries as well.

In reality, only about 50% of orphan drugs get authorized for use here in Canada. That may not be a problem, unless you're a patient or a parent who's waiting for a drug and has a debilitating disorder and are trying desperately to get something before it's too late.

To address these barriers and to facilitate patient access, we urge the federal government to implement as quickly as possible the draft federal orphan drug regulatory framework that has already been developed by Health Canada. Within this framework was a definition of rare disease as a condition that affects fewer than 1 in 2,000 people.

Even in cases where treatments are approved in Canada to treat rare diseases, patients experience important difficulties in accessing them. We know that most Canadians experience gaps in drug coverage, but for patients with rare diseases it's exacerbated. Our survey in 2015 showed that 1 in 3 patients with rare diseases could not access an appropriate drug treatment that was, in fact, in Canada.

Every country is struggling with how to address rare diseases and orphan drugs, but sadly, I think Canada is doing worse than most other developed countries to provide equitable and sustainable access.

Very briefly, the experience of patients who have Fabry's disease illustrates the delays in accessing orphan drugs. As you may know, in 2004 Health Canada approved two products to treat this disease, which is a debilitating condition that leads to organ failure and early death. Unfortunately, because they were using a very traditional cost-effectiveness assessment, the Canadian Agency for Drugs and Technologies in Health recommended that these drugs not be covered by the public drug plans. As a consequence, patients with private drug insurance were all able to access the medicines, but the patients covered by the public plans could not. It took about two years for the governments to set up a managed access program to fund the drugs. Very recently, another report confirmed the clinical effectiveness of these therapies.

What did we learn from this example and many others like it? Access to drugs for rare disease in this country is not effectively serving the patients. The problem is that the health system isn't saving any money by doing it this way, because the gaps in patient access to the right drugs lead to increased morbidity and poorer quality of life, and also to increased costs for the families, the health care system and, ultimately, the Canadian economy, as Maureen's story and those of thousands of other patients illustrate.

CORD supports a national pharmacare program, but we feel it should be guided by a set of core principles, including equity, quality of care and treatments, patient involvement, the incentivization of development and marketing of new therapies, and collaboration and coordination. We don't really care whether the program is administered federally or is a pan-Canadian federal-provincial-territorial approach, but we do believe that it has to have the following key characteristics: first, access to medicines according to a single set of eligibility criteria; second, flexibility and exceptional adjudication measures to ensure that the unique circumstances of each patient can be addressed, and addressed fairly; and third, a national pooling across all drug plans to ensure equitable and affordable access across the country.

I would be remiss not to address the prices of orphan drugs. We think that drugs for highly specialized diseases for small patient populations will, no doubt about it, cost more per patient than common drugs. There are some obvious factors involved, as you can imagine, including the higher cost for research and development of these drugs, as well as the smaller size of the patient population. To put that in perspective, rare diseases are more costly to diagnose, they're more costly to treat in hospitals, and they're more costly to follow by family physicians and pediatricians. They are simply more costly because they're rare, and they're severe and debilitating. Does that mean they're less worthy of treating, just because they're costly?

I think Pope Francis said it very well when he called for the globalization of empathy, which should be used to value all human lives, including people with rare diseases.

I want to conclude by saying that patients with rare diseases are really wanting to work collaboratively with all stakeholders. We want to make sure that the drugs are used appropriately and responsibly, and we also want to make sure that the prices in Canada are fair and—very importantly—sustainable.

We know that patients with rare diseases have extraordinary, unnecessary barriers to getting the appropriate care and treatment. We really encourage the federal government to do its part in helping address these challenges by implementing the orphan drug regulatory framework, and by working with the provinces to put in place a coordinated, national approach or program to ensure timely care and appropriate and equitable access to rare disease therapies. We think all Canadians with rare diseases deserve the same quality of care available to patients in other countries and patients with common conditions.

[The Chair, Liberal, Bill Casey]

Thank you very much.

Mr. Herder, welcome back.

[Prof. Matthew Herder, Associate Professor, Faculties of Medicine and Law, Health Law Institute, Dalhousie University, As an Individual]

Thank you for the opportunity to appear before you today.

My name is Matthew Herder. I'm a lawyer and an associate professor in the faculties of medicine and law at Dalhousie University.

My research focuses on laws, policies, and practices around pharmaceutical drugs. My publications and testimony before this very committee in 2014 helped contribute to a number of important changes to Canada's Food and Drugs Act, known as Vanessa’s Law.

I want to begin by registering my support for national pharmacare. It is not a panacea; however, it is highly preferential to the status quo and increasingly needed as more targeted, personalized therapies enter the Canadian market.

Building from my research brief, which I submitted to this committee, I will focus on the set of issues or challenges posed by the pharmaceutical industry's shift to more personalized therapies or precision medicine. In short, the range of drugs developed and marketed under the banner of personalized medicine both underscores the case for and helps define some of the essential features of national pharmacare.

Today I want to make three points.

My first point is that while personalized medicine remains a work in progress, the pharmaceutical industry has shifted its focus to more targeted therapies. In the last two decades, large-scale genomics and related research initiatives have generated a wealth of new information about the molecular underpinnings of human disease. But the process of discriminating between information that actually helps to prevent, diagnose, and treat human disease versus misinformation is just getting under way.

Researchers and drug companies are increasingly integrating genomic and epigenomic information into their drug discovery and development platforms. There are hundreds of such personalized therapies currently in development, despite the uncertain clinical value of many of the biomarkers that have been incorporated into these interventions.

This trend dovetails with industry's increasing focus on rare diseases. Indeed, many of the personalized therapies that have come on the market qualify for extra incentives that countries, such as the United States, have put into place to encourage research into rare diseases.

Pharmaceutical companies have allocated an increasing share of their resources toward rare diseases. For example, nearly a half of the novel therapies that were approved by the United States Food and Drug Administration in 2015 fell into that category. Why? This is because industry has figured out that the development of such therapies, also known as orphan drugs, can be as profitable, if not more profitable, than drugs that address more common conditions.

Developing orphan drugs tends to be faster and cheaper, because fewer patients are eligible to participate in trials. Once a rare disease drug is approved, it faces little to no competition in the marketplace, enabling companies to charge premium prices. Indeed, price tags of $200,000 to $300,000 per patient per year are increasingly common for rare disease therapies. As a result, the development of more personalized, targeted therapies, incorporating genomic and other sorts of biomarkers, account for a growing share of both public and private expenditures on prescription drugs in Canada.

My second point is that our national pharmaceutical regulator, Health Canada, is allowing these drugs on the Canadian market despite limitations in the evidence about the safety and effectiveness of those drugs.

For most of their existence, pharmaceutical regulators, such as Health Canada, have approached their task in a binary manner: should a drug be on the market, yes or no? In recent years, however, the approach has become more dynamic, with regulation theoretically continuing across the life cycle of a drug, both before and after it's on the market. This new approach to regulation is often called “adaptive licensing”. While adaptive licensing makes sense in principle, it may be a double-edged sword in practice.

We've long known that the evidence generated in the course of clinical trials has its limitations. Real-world use of drugs, without careful control from a research team, is when a drug's true safety and effectiveness profile becomes more evident. For that reason, no one thinks that ongoing, active monitoring of a drug's safety and effectiveness after it's been approved is a bad idea. However, if the promise of ongoing study, in effect, lowers the bar for approval in the first place, we run the risk of letting a lot more unsafe, ineffective drugs on the market.

The stakes of that gamble are especially high in the case of rare diseases. Because these drugs focus on small patient populations, a number of the standard procedures used by researchers to ensure that the results of their studies are robust are often not followed. Consequently, as two U.S. physician researchers recently put it, these sorts of studies run a greater risk of “identifying benefits that are not real or missing risks that are.”

In such instances, ongoing, rigorous post-market evaluation of a drug's safety and effectiveness is essential. Thankfully, Health Canada, following the passage of Vanessa's Law, has a number of new legal powers that should assist with that task; it can finally compel companies to carry out post-market studies and share information.

However, and here's the rub in terms of pharmacare, there's a fundamental mismatch between Health Canada's move to adaptive licensing and the provincial and territorial infrastructure concerning drug coverage. The existing patchwork of payers and health technology assessment bodies is poorly equipped to process and act upon new information about a drug's safety and effectiveness in real-time.

That brings me to my third and final point.

Our current patchwork of health technology assessment bodies and public and private payers lacks the capacity to handle the shift that we're in the middle of, namely, toward personalized, targeted therapies. As I've just said, evidence about a drug's safety and effectiveness should increasingly span both the pre- and post-market phases of a drug's life cycle. Yet few, if any, private insurers in Canada have the capacity to evaluate this information on an ongoing basis. It is doubtful whether a number of provinces have that capacity either. A national pharmacare program or formulary should in principle have greater institutional capacity to do so, and to establish key information-sharing channels with our national regulator, Health Canada.

Similarly, our current system lacks the capacity to negotiate more nuanced drug coverage deals with companies. Because of the tenuous nature of the evidence produced with respect to personalized therapies during pre-market testing, and the deep divide between standards of safety and effectiveness applied by Health Canada and the question of cost-effectiveness that public and private payers are focused upon, there is a growing need for more sophisticated reimbursement contracts.

One model is called coverage with continuing evidence development, or CED. Another is performance-based risk-sharing agreements, or PBRSAs, where payment for a therapy is contingent on observing benefits in patients following treatment.

Again, both public and private payers in Canada generally lack the ability to collect and analyze information on an ongoing basis, thus negating the value of those kinds of more sophisticated contracts with companies.

In contrast, a national formulary could do so, and in turn adhering to a much more evidenced and performance-based approach to drug coverage. Given the incredibly high-priced nature of many personalized rare disease drugs, maximizing value for money is imperative, and national pharmacare has a much better potential for doing so. Plus, the prices of these new targeted therapies need not be so high. The pan-Canadian drug pricing alliance only represents about 40% of Canada's drug purchasing power. National pharmacare representing all Canadians would substantially increased our bargaining capacity.

Finally, and perhaps most importantly, our present patchwork of health assessment bodies and payers lacks the capacity to handle the increasing politics of drug coverage. Our national drug evaluation body, CADTH, adheres to an evidence-based approach in making recommendations about which drugs to cover. But that's just it: CADTH only makes recommendations. Payers remain free to make their own decisions, so drug companies and patient groups train their attention on those governments, politicizing drug coverage decisions through media stories and playing a game of divide and concur with provincial payers.

A national formulary situated at arms-length from government, and relatively free of industry influence, offers the potential to de-politicize drug coverage decision-making. We know that drugs are notoriously difficult to delist, but given the limited nature of the evidence at any given point in time about a targeted therapy, the power to stop funding a drug or renegotiate payment structures depending on observed benefits is integral to a well-functioning drug reimbursement system.

If a national formulary is to have any meaningful ability to exercise that kind of power, its independence from government and industry alike must be protected.

Yes, industry and patient groups should be heard as part of that decision-making process, but they should do so under strict conditions of transparency to the Canadian public and without compromising formularies' ability to negotiate and act upon performance-based drug coverage agreements.

To conclude, personalized medicine's laudable goal is to enable more precise decision-making about which drugs to use. It remains a work in progress. National pharmacare designed as an evidence-based, independent, and transparent institution has the potential to to improve Canada's capacity to make more precise decisions about which drugs to pay for. It's imperative as more and more high cost targeted drugs of uncertain benefit enter the Canadian market.

[The Chair, Liberal, Bill Casey]

Thank you very much.

Dr. McCabe.

[Dr. Christopher McCabe, Capital Health Research Chair, Faculty of Medicine and Dentistry, University of Alberta, As an Individual]

I'd like to start by thanking you for the invitation to speak today.

You probably notice from my accent that I'm from the U.K., and much of my experience and insights into a national pharmacare program I have derived from 20 years' experience as a health economist advising the NHS on paying for drugs. I have now been in Canada for five years.

I hope I'll take considerably less than the 10 minutes that you've allocated.

I wish to make three points with regard to national pharmacare.

The first is the cost-savings capacity of a national pharmacare program. We just heard from Dr. Wong-Rieger and Dr. Smith on how the absence of effective pharmaceutical therapies impacts not only the health of the individual, but also the costs they impose on the health care system.

This is not unique to rare diseases, as exactly the same story is in play for those people who cannot afford to fill their scripts for chronic common conditions or infections. These people also will turn up at the emergency department and may be admitted, but impose significant costs on the health care system, which, as you all know, come from the public budgets. In effect, the taxpayer picks up the tab for the health management of the avoidable complications of these conditions.

I think that's both a financial and a social equity argument for national pharmacare. We could hopefully reduce the inequality in access to high-quality care and the inequality of health by addressing the needs of those people who can't fill their scripts due to socio-economic reasons.

I'll move on to my second point, which is about precision medicine. I lead two large research programs funded by Genome Canada around personalized and precision medicine. Whilst the number of technologies currently on the market is small, the number in development is very large. The last time we looked at this, we identified 167 precision medicine technologies in clinical trials globally.

They are coming and are defined by a couple of key characteristics.

First of all, they arrive at market with a really quite immature evidence base. There's very little we can do about that in the clinical trial setting simply because the nature of precision medicine is that it identifies smaller subsets of the population who can benefit from the technology, and so the level of evidence that you can generate in the clinical trial phase is inherently less than for conventional medicines designed to treat common diseases.

Secondly, the nature of the test technologies—the defining characteristics of these—is such that it is much harder to generate convincing evidence. You need much larger trials to generate strong evidence on the performance of these tests that is generalizable to all the populations.

We are looking at a situation where regulators are going to be having to make decisions about proving these new technologies on much more uncertain evidence.

Dr. Herder referred to the Vanessa's Law and how it creates the facility for adaptive licensing so that we can move some of the evidence-generation process into the post-market phase. That is only feasible if there is a sister organization with a national remit that's responsible for reimbursement and that can take the baton from Health Canada and actually deliver national access so that you get the necessary volume of uptake of the technology to generate the evidence. In my briefing I describe the case of Prochymal, which was probably the first truly innovative technology to be put forward for a conditional licensing approval, and it went nowhere because it couldn't get reimbursed.

If, as I think is appropriate, our innovation or industrial strategy in this sector is seen as adaptive licensing, making Canada an attractive place for inward investment in the pharmaceutical industry.... Vanessa's Law and those facilities that it gives the regulators are a necessary condition, but a national reimbursement authority of some form is probably a sufficient condition. So there are important industrial policy implications to trying to move forward in this space without a national pharmacare strategy.

The third point I would raise returns to the orphan drugs and orphan disease community. A lot of those same issues I've described for precision medicines are pertinent for the orphan disease community. I think it's important to recognize that in creating a national pan-Canadian formulary, there is the opportunity to raise the standard of care for these people. Because there are very few with each individual disease, though they are very large in number in the entirety of the diseases, the clinical expertise in the packages of care they require for good outcomes is rare as well.

By having a national pharmacare organization that can contract with specialist centres, we would be able to ensure the quality of care that's provided, and to have specialist and more rapid diagnostic facilities. As a result, we could build a package of high-quality care around the drugs that were implemented. I think that would be beneficial both to the patients and the health care systems by avoiding those diagnostic odysseys that these patients go on, consuming large amounts of resources in doing so. It would also be an opportunity to negotiate for all Canadians affected by those diseases and thus an opportunity to reduce the total budgetary impact.

For each individual orphan drug, the budgetary impact is small, but with literally hundreds of orphan drugs coming down the line, the total budgetary impact is large. You can get an orphan drug designation with 17,000 patients affected in Canada. If it's $100,000 per patient, per year, you can quickly see how the total budgetary impact does not stay small and that there will be a need to manage the total budgetary impact of orphan drugs at the same time.

Thank you again for inviting me, and I hope they were useful insights.

[The Chair, Liberal, Bill Casey]

Thank you very much.

Dr. Tamblyn.

[Dr. Robyn Tamblyn, Professor, Department of Medicine, and Department of Epidemiology, Biostatistics and Occupational Health, McGill University, As an Individual]

Thank you very much for rescheduling.

I sent on a bit of a PowerPoint deck. I hope you have it. I will walk you through a few thoughts here.

I've decided I'm going to make just two points. One is going to be related to a plea, essentially, to consider a value-based formulary for Canada. The second is on our unused assets for post-market surveillance.

My colleagues have covered the rare-disease, designer-drug, genomic-based therapies better than I can, so I will not go in that direction. Let me speak to the first two points.

Presently in Canada there is a patchwork. If you're institutionalized, your drugs are free; if you're in the community, it varies by province as to whether or not your drugs are covered. All provinces set up a formulary, meaning those drugs we'll cover and those we won't. For the most part they're covering about 70% or 80% of the drugs that are approved for consideration in Canada.

They do so for what I call the vulnerable subpopulations, by and large—seniors, who use a lot of drugs; people on social assistance; and there may be some other very high-cost drug therapies, but this varies from province to province.

They can't afford it, because seniors are a big group, and so what they always do is attach what I call a copay to it. They say that you'll have to pay a part of this, because otherwise...we want to control the demand for something that may be misused or abused.

I want to take you down to an example of this. In this particular slide, I show you an example of a person who was 25 and was diagnosed as schizophrenic at age 24. This is an architect who had asthma. The person was put on risperidone. That drug costs $140 a month. The inhaled steroid for asthma is $120 a month. From time to time the person has sleeping problems, so that drug is lorazepam, and it costs $35 a month.

If you look at the cost sharing, which goes anywhere from zero to 35% across Canada, 25% was applied in Quebec. They have to pay the most for their anti-psychotic drugs, they have to pay the least for their sleeping medication, and somewhere in between for the steroid to control asthma. Tell me if that makes any sense whatsoever.

When Quebec put in place essentially an increase in that cost share, they saw a very rapid decline—that's shown in the graphic, figure 2 on the “Current Practice” slide—in the use of these essential medications. It was associated with an increase in hospitalizations and emergency department visits.

This is not really a surprise, in fact, because these drugs are essential to control chronic conditions, and they work. If they were being misused—say you run around and take insulin just on a whim—you would see no change in your health status, but if you really need it, you're going to get into trouble pretty quickly. That's exactly what they saw.

The argument I'm trying to make here is that we need to provide, if we want to make sense of what we're doing here, a value-based formulary that says, let's make essential medications that we know control disease free; let's make them available to our population. Let's negotiate the best prices possible in Canada, because we pay sometimes five times as much for an essential drug as other countries. Let's go after that, and let's be parsimonious.

Not every drug gets in—not the 70% that we're used to doing—but let's say the absolutely essential drugs that we know work and that keep people well and working in our community; let's make that our goal to start with. Then we can actually add the cost share to those that potentially could be misused, such as my taking a proton pump inhibitor because I ate too much at the last wedding I went to—that kind of thing.

This is what I'm pushing for. In fact, there are experiments now demonstrating that this actually produces better value for money—I think this is the key here, because we're all afraid that this is going to bankrupt us— and better health outcomes for the community at large.

That's my first case. I've actually suggested here that this value-based formulary essentially be free and that we attach the copays to drugs that could be used or misused in other ways.

Just applying that thinking, I want to make the case for parsimony. If you look at Canada, one of our biggest problems is uncomplicated hypertension, meaning that we're getting older, we're getting fatter, and we tend to have this problem.

What is Canada doing right now? I provide a bit of a breakdown on the slide called “Impact of Value-Based Formulary”. We're spending $2 billion on the treatment of uncomplicated hypertension—just that alone—per year.

If you look at the drugs that we're doing, they vary in price from $173 per person, per year, for a thiazide diuretic to $427 for a multiple drug therapy or for an ARP.

Does that make sense to you? Could we be smarter and say that we're going to give the thiazide diuretic free, and for all the other drugs you're going to have a copay attached to it? At least we'd know that we have an effective drug out there that could treat uncomplicated hypertension. If we did that, and even if we increased the use of thiazide diuretics by 25%, we would save $412 million a year. It makes sense for us to do something along that line.

That's not to say that it's without politics, but at least we have the evidence. We have the scientific evidence to support these decisions.

I will move on to my second point, which is that we're going to do this right and have a national approach to our pharmaceutical strategy, we need a value-based formulary first, and you must have a smart post-market surveillance system second. I am going to make the case here that Canada has some of the best assets in the world, which we've failed to use systematically. I think it's time we use them in a strategic way.

The first thing that happens when a drug gets approved is that it gets thrown out into the market, and people can prescribe it as they wish. If we want to look at off-label use, that was the origin of the unfortunate circumstances that lead to Vanessa's death. Approximately one in 10 drugs is going to be used off-label, meaning that the regulator didn't approve it for that indication. Of those drugs, not all of them lack scientific evidence, but the majority do. A little less than one in 10 will not have scientific evidence for the use of that indication.

It's a bit of a social experimentation that's going on. Sometimes that's a good thing and you discover things you wouldn't have normally discovered. The bad news is that when you are prescribing drugs without scientific evidence, you don't know what their effectiveness is, and you don't know what their risk is.

One of my colleagues did a study on this and looked at the rate of adverse events for off-label use of drugs without scientific evidence. It's quite a bit higher, as you can see in the graph for adverse events, because people are prescribing off-label. Are they doing this intentionally? Probably not. They probably don't know what the scientific evidence is or is not, and they may not have the most up-to-date information on that fact.

What do we do about that? One thing is that we'd better start monitoring off-label use, and we'd better start monitoring adverse drug events that are occurring in the population.

This next deck shows you the adverse drug event reporting requirement. What we know about adverse drug event reporting is that of all the adverse events that are reported, a small proportion, less than 5%, are recorded. Of all those that are occurring, very few are reported. Why is that? Well, it's onerous, quite frankly. No one pays anybody to do that, no one knows where the form is, etc. You can make it mandatory, which is the suggestion from the new regulations, but I think there's a smarter way of doing that.

If we look at our unused resources for doing this, first of all, we have a national health information organization that collects information, and could do so almost in real time, from everybody across Canada. It has agreements with all the provinces. It's called the Canadian Institute for Health Information. That's benefit number one.

Second, we have Health Infoway that invested heavily in creating data repositories for a population-based repository of all drugs prescribed and dispensed, all labs, and all diagnostic imaging.

Third, they've invested in electronic medical records. Now we have the digital information to start putting together a method of monitoring what drugs are being prescribed, what they are being prescribed for—meaning if we can monitor off-label indications—and when they are being stopped and changed because they're not working, or the person is experiencing an adverse drug event. We can capture all that information. Why? It's because we have these players in place. We've made these investments. We just need to pull it together into a national reporting system, and we have the talent in Canada to make sense out of that information.

Finally, we've just invested $50 million in having Infoway build a national prescription system. We can start capturing why this drug was prescribed, why it is being stopped or changed, and we'll know in real time. I've shown you an example of a screen that does exactly that. These are being built into electronic prescribing systems. If you stopped this drug, you need to let the pharmacist know you stopped it, because they're going to keep on dispensing it if you didn't tell them. The person stopped using it because they had an adverse drug event. And what was it? In this case, it was that the person had epilepsy, a seizure, from this medication. That can all be captured. You stop the drug; you need to tell people you stopped it, and that it was stopped for such and such reason, so that people won't re-prescribe it.

I'm thinking that we have all the pieces together and that it's simply a matter of trying to make use of all these pieces through a strategy that can be developed nationally for the country.

Thank you for your time.

[The Chair, Liberal, Bill Casey]

Thank you all for some incredible information.

Now we'll start the questions with a seven-minute round.

Dr. Eyolfson, you are first.

[Doug Eyolfson, Liberal, Charleswood—St. James—Assiniboia—Headingley, MB]

Thank you all. This was all very useful information. I could not write fast enough to keep up with all that was really useful.

First, I have a couple of questions for Dr. Tamblyn.

We talked about an evidence-based formulary and about there often being alternatives that are more expensive but that don't do as well. We've had some criticism in the past, with some physicians and patients wanting choice even if the choice for a more expensive medication is not actually based on any improved outcomes.

Would you foresee a system wherein you could approve a drug for use, so that people had that choice, but not have it on the formulary? If someone has a proton pump inhibitor that is cheap, they can have it prescribed and it's paid for. If they really paid attention to the ad that said “Ask your doctor about Prevacid” and want that, they could get it, but they pay for it.

Is a system like that feasible?

[Dr. Robyn Tamblyn]

Yes. In fact, that's what I'm advocating. For chronic conditions for which we have very effective therapy, we can't afford to not let...just as we provide medical services for free, or hospitalization is free. We provide an equitable situation in our country for things that matter. We need to have that free.

Then you can attack the copayer, the sharing—it's always still available—under other alternatives that may be a bit more expensive, but for which something cheaper will do.

[Doug Eyolfson, Liberal, Charleswood—St. James—Assiniboia—Headingley, MB]

Sure. Do you know of any jurisdictions in which this is actually happening right now?

[Dr. Robyn Tamblyn]

Yes, there's a lot of experimentation going on in the U.S. and in the value-based formulary in the United Kingdom, where essential medications are free, and for the other ones you either pay completely out of pocket, which is currently what most of our population does.... They pay for everything out of pocket, unless they have private drug insurance.

Focusing on a value-based formulary, yes, is happening in both the U.S. and the U.K.

[Doug Eyolfson, Liberal, Charleswood—St. James—Assiniboia—Headingley, MB]

All right, thank you.

Another question is that when we talk about a formulary—you talked about off-label medications....

I should say, as a background, that I am a physician, so I'm familiar with much of that terminology, and I see medications prescribed for off-label uses.

Do you think there's a way that in a formulary there could be the indications for a prescription, so that you could say it's covered if you're doing it for the on-label indication but not covered if it's for the off-label? Is there a way of controlling that in a formulary?

[Dr. Robyn Tamblyn]

No, there is not really, not unless you captured the information at the point of care. That is what I'm advocating: you're going to build a national electronic prescribing system, and one of the requirements of it is that you indicate what the indication for treatment is. You can advise physicians at that point whether this is on- or off-label. I'm not sure they really know whether it is or it isn't.

It's there that I think you can capture it. Then you can actually do your conditional coverage.

[Doug Eyolfson, Liberal, Charleswood—St. James—Assiniboia—Headingley, MB]

Okay, good.

Mr. Herder, you talked about post-marketing research, about needing, once a drug is on the market, a system of surveillance to make sure that the effect you've seen is still there and that the efficacy and safety are still there. I agree that this is particularly in the case of the rare drugs for which you have low sample sizes. If the drug that has been marketed is found unacceptable and your surveillance shows it's not doing its job, are you foreseeing a mechanism whereby these drugs will actually be withdrawn, if something gets on the formulary, and you say this is not on the formulary because it doesn't do what it has promised?

[Prof. Matthew Herder]

In a word, yes.

Part of the challenge we face is that it's really hard in the current system, because of the patchwork that exists, to ensure that this occurs across the board and that therefore there is some level of fairness, and also that we're taking advantage of the kinds of opportunities Dr. Tamblyn highlighted to continue to evaluate and therefore make really informed decisions. In cases in which the evidence shows that over time a drug is not nearly as effective as perhaps Health Canada or the formulary thought, or is not as safe as we thought, or is being used on an off-label basis too much and therefore we need to end that kind of decision making, there might be instances in which coverage is withdrawn, yes.

[Doug Eyolfson, Liberal, Charleswood—St. James—Assiniboia—Headingley, MB]

For the question I just asked Dr. Tamblyn a second ago, do you know of any jurisdictions where they're doing this?

[Prof. Matthew Herder]

I think that's the assumption behind the jurisdictions that were mentioned, the U.S. and U.K., about moving in that direction, that it's necessary. I'm not aware of specific examples where it's been fully withdrawn pursuant to those kinds of agreements, but I think there's an increasing awareness that it's going to be a necessity because of the tenuous nature of the evidence at the time of approval and coverage. If we allow theses things to remain in perpetuity, regardless of what the evolving evidence tells us, that's a huge problem for safety and value for money.

[Doug Eyolfson, Liberal, Charleswood—St. James—Assiniboia—Headingley, MB]

In regard to the essential chronic drugs that are more widely used, one of the examples that is starting to come up in the medical literature right now is statins. A lot of money is being spent on statins. For anyone who doesn't know, these are the drugs that lower cholesterol. There's a growing opinion in the medical research that these do not improve outcomes at all and are not living up to the original therapeutic promise, but they're representing a high proportion of regularly prescribed drugs. Could such a mechanism withdraw an entire class of drug like that if it turns out that we're spending a lot of money on something that doesn't work?

[Prof. Matthew Herder]

It could potentially. The point I would make is that it could also elevate the standards for demonstrating improvement over existing therapies. What we see right now, unfortunately, is that a lot of new medications aren't terribly important for advancing care and health care outcomes. They are me-too drugs, and so on. I think this kind of body could encourage greater innovation that is in line with improved health care outcomes.

[The Chair, Liberal, Bill Casey]

Ms. Harder.

[Rachael Thomas, Conservative, Lethbridge, AB]

My first question is for Dr. Wong-Rieger. I'm wondering if in Canada right now it is easier for patients with rare diseases to access the pharmaceuticals they need through a private or a public plan at the moment?