Thank you, and I'd like to add thanks to my fellow speakers.
My name is Dr. Doug Coyle. I am currently a Professor and Interim Director at the School of Eepidemiology at the University of Ottawa. I am a health economist and have worked in this research area for the past 26 years. As with Dr. Perry, I have no conflicts of interest to report.
I am a member of the Ontario Ministry of Health's committee to evaluate drugs, where I help make recommendations on the funding of new pharmaceuticals. I was previously a member of the Canadian expert drug advisory committee, which gives similar advice at the pan-Canadian level, and also the Ontario health technology advisory committee, which makes recommendations in the funding of new technologies to hospitals.
Thank you very much for giving me the opportunity to present my views today. At the University of Ottawa, I teach graduate students in the methods to appraise new technologies in terms of their costs and benefits, and whether or not they represent the best use of our scarce health care resources. I've conducted a number of studies in this area on drugs, devices, vaccinations, screening programs, and exercise programs.
I have a passionate belief in the necessity of a publicly funded health care system. This is based, first, on the fundamental belief that equality in access to health care should be a right, and second—and we should never forget this—that the nature of health care as a commodity is such that provision through a market-based system is inefficient.
I've been asked today to present my views regarding a national pharmacare strategy. Before proceeding with my views, I'd like to remind you that when I moved to Canada in 1995, the issue of a national pharmacare strategy was a hot topic, but little progress, if any, has been made in the 21 years since then.
The common drug review and the pan-Canadian oncology drug review have been established to help provincial ministries review the evidence related to the costs and benefits of newly available pharmaceuticals. However, though both agencies have a process whereby recommendations related to funding are made, they do not have the ability to make these reimbursement decisions.
Recently the pan-Canadian Pharmaceutical Alliance, or pCPA, was established across provinces to assist them in discussing with industry possible solutions to allow the coverage of new pharmaceuticals through agreements in price. The federal government has recently joined pCPA. I am going to talk about some of the issues related to that for the rest of my talk.
I believe that a fair, equitable, and transparent Canada-wide process for making the complex and difficult decisions with respect to reimbursement for health care interventions is a necessity to ensure the sustainability of our health care system. Although the developments that have taken place appear valuable, today I wish to highlight concerns with the current situation with respect to pharmaceutical funding.
These concerns relate to three fundamental principles by which a national pharmacare strategy needs to be organized: the need for fairness, the need for transparency, and the need for consistency in decision-making across all health care interventions.
Fairness should be at the heart of all decision-making with respect to health care. Thus, difficult decisions on what should and should not be covered need to be made through a process that recognizes the need to treat people equally. However, not all new technologies represent value for money. Despite industry claims, most, if not all, new technologies are unlikely to save money in the long term. The downstream costs that are averted through their adoption are not sufficient to cover the upstream costs of their purchase.
We need to assess whether prices given for new technology are justified, given their potential benefits. Ultimately, given that we work within a system with a constrained budget, the cost of providing one technology should not be measured in dollars and cents but in terms of the potential health benefits that can be realized by the funding of one technology rather than other technologies that we can no longer fund. For too long in Canada, reimbursement decisions with respect to pharmaceuticals have not recognized this basic tenet of decision-making.
With respect to the issue, there are clear problems with pCPA. Once negotiations begin with pCPA, it rarely fails to make an agreement with a company on a specific drug. We all know that if we walk in and tell a car dealer that we are going to make a deal, we won't get the best deal that's available to us.
Second, and more importantly for future decision-making, pCPA does not appear to have criteria by which it defines a bottom line in decision-making. For pCPA to be of any use in facilitating a national pharmacare strategy, it must develop a framework that allows identification of what is and what is not a good deal and be willing to walk away from the table when no reasonable deal is on offer.
Thankfully, there are research techniques that can assist in making such difficult decisions, and pCPA needs to adopt these.
I'd like to give you today the example of Soliris. Soliris, you've probably heard, is a drug for the treatment of a disease called paroxysmal nocturnal hemoglobinuria. Thankfully, we can call it PNH—I can't even pronounce those words—which makes it a lot easier for us to follow.
PNH is rare blood disorder. Soliris is effective. It reduces the incidence of thromboembolism, the major cause of mortality in this disease, and it reduces the need for blood transfusions, the major management cost of the disease.
However, Soliris costs $500,000 per patient per year. That's probably why you've heard of Soliris. An independent analysis conducted relating to Soliris found that it would be worth funding on the basis of equity, if a price reduction of 98.5% were achieved.
The funding of Soliris at its listed price would cost almost $25 million per annum, even if only 20% of those eligible to receive it would receive treatment. With that $25 million, we could provide many other health care services to Canadians that would provide much greater health benefits.
The pCPA did reach an agreement with the manufacturer of Soliris for the treatment of PNH. Given the necessary price reduction, it is highly unlikely that this agreement represents a fair and reasonable decision.
We should support innovation by ensuring that funding is given to those technologies that represent value for money, including those that are not commercially sponsored. By guaranteeing funding to new technologies, we are not helping industries. Industries that become too reliant on government subsidies and preferred supply arrangements stagnate and decline. This, I feel, is the current fate of the pharmaceutical industry.
If you were to proceed with a national pharmacare strategy, I would argue that we need to make transparency a fundamental principle. We need a much more transparent process in making decisions, as well as in transparency agreements between manufacturers and health care payers.
A major component of the pCPA is facilitating such agreements between ministries and manufacturers. These agreements are typically confidential, and thus no one can assess whether such agreements are in the best interests of Canadians. Openness encourages innovation and ensures fairness for all Canadians.
The final point I'd like to raise is the one I really want you to take home: the need for a more comprehensive approach to the funding of all health care interventions for all Canadians.
The focus today is on pharmaceuticals. This is in line with a typical focus on the funding of new technologies that have a commercial interest. This leads us to funding decisions that typically favour such technologies over alternative health care interventions, where profit is not a driving factor for those advocating for their coverage.
However, we need to consider all the technologies that are out there. Many existing technologies are underfunded, yet have evidence to support their effectiveness and cost-effectiveness. Many of these do not have commercial sponsors.
Given the changing demographics of our country and the increased long-term need for home care and long-term care, the continued focus on pharmaceutical coverage is, in many ways, missing the major potential problem facing our health and social care system. Care through hospices, home care services, and nursing homes suffer from a lack of commercial interest in promoting them and are often overlooked by those societies advocating for health care. There is a lack of funding for conducting research to highlight their benefits, and there is limited lobbying because of the lack of a commercial sponsor.
To summarize, I'd like to reiterate the following points.
For a publicly funded health care system to be sustainable, we must have decision-makers who are willing to make the difficult decisions not to fund specific new technologies. By failing to make such decisions in a consistent and fair manner, decision-makers are currently not doing their job. This is detrimental to Canadians as a whole. Fairness should be a key principle. Funding technologies that deny the availability of other technologies that provide more benefit is not fair. This is frequently the case with respect to funding for pharmaceuticals.
Transparency is key. The degree to which decisions on health care funding, especially for pharmaceuticals, are made behind closed doors through confidential agreements is scandalous and needs to be addressed.
Finally, although the focus today is on a national pharmacare strategy, I want to emphasize that sensible and rational decisions made on a consistent basis are required in the funding of all health care interventions, not just those with commercial interests promoting them. Thus a national health care strategy will be a longer-term benefit to Canadians and may ensure the sustainability of the health care system we all so passionately support.
I thank you all for your time.