Evidence of meeting #42 for Health in the 42nd Parliament, 1st session. (The original version is on Parliament’s site, as are the minutes.) The winning word was pharmac.
A recording is available from Parliament.
NDP
Don Davies NDP Vancouver Kingsway, BC
I'm curious about your thoughts on the impact of copayment. That's something this committee is having to look at. I know there is a small copayment of $5, I believe it is. There are some exemptions, etc.
Do you have any advice for this committee in terms of whether we should or shouldn't consider copayments?
Chair of Board, Head Office, Medicines New Zealand
That really is a philosophical question, I think. New Zealand has seemed relatively content on the whole with the $5 copayment. It did increase from $3 several years ago, and that has not altered the pickup rates at all. I think $5 per item is relative low. Sometimes it's not $5 if the cost of the medicine itself is less than that.
As I did mention in my introductory comments, people pay for only 20 items per family, and after that there's no copayment at all. It's a relatively small amount of money.
General Manager, Medicines New Zealand
New Zealand now has a system under which anyone under the age of 13 has free prescriptions at no charge. Young children aren't charged at all.
NDP
Don Davies NDP Vancouver Kingsway, BC
Thank you, Mr. Webber.
I'm told I have one minute.
Pardon me if you've covered this point already, but I want to be clear I understand this. Pharmac recently commissioned the “mind the gap” research study in response to commentary that suggested that access to cancer medicine in New Zealand results in poorer health outcomes compared to Australia. I'm told the study showed that more medicines didn't mean better health outcomes. Out of the 35 cancer medicines not funded in New Zealand, only three offered clinically meaningful benefits, with Pharmac already funding one of them, pertuzumab for breast cancer, and considering funding for the other two.
The study concluded that:
A policy of funding more new cancer medicines in order to achieve numerical parity with Australia or other countries would not result in substantive health improvement and would cost significantly more....
Do you have any comment on that conclusion by Pharmac?
General Manager, Medicines New Zealand
It came in for a lot of criticism publicly from oncologists at the time it was first released. It's not based.... As I mentioned, the studies that I saw had been based on the real world, so they were looking at this vast system with their medicines in it.
The Pharmac study was pretty much based on the clinical trial evidence and came in for, not surprisingly, a lot of criticism in Australia. It's like saying the Australian health system is wasting $400 million on cancer medicines that don't achieve anything.
We would refute it; it's not based on real-world evidence. You've got to look at these drugs and where they're utilized, and that study didn't. It was clinical trials. It was based on the clinical trial data.
Conservative
The Vice-Chair Conservative Len Webber
Thank you, Mr. Davies.
We're going to quickly move on to Mr. Ayoub from the Liberal Party.
Liberal
Darshan Singh Kang Liberal Calgary Skyview, AB
Thank you, Mr. Chair.
Thanks for getting up early in the morning and sharing your thoughts on Pharmac.
As my first question, you have to bargain with the pharmaceutical companies. It's probably hard bargaining, and this may be time-consuming too. As the power to gain a stronger hand on negotiations is important to savings on costs and also the supply of drugs, how does New Zealand negotiate for drugs for rare disorders, which may have astronomical costs?
Chair of Board, Head Office, Medicines New Zealand
The area of rare disorders is very problematic, because Pharmac looks at issues from a population perspective, so those rare disorders actually are difficult to deal with. I don't think that those who suffer in New Zealand are particularly generously treated.
A year ago the government instructed Pharmac to reallocate some money for rare disorders, although our understanding is that it hasn't really been spent. It was a small amount for five years, and that budget hasn't been used, but Graeme might have some other comments about that.
General Manager, Medicines New Zealand
It's timely, because Pharmac is just reviewing the rare disorders program after five years and invested around $25 million. I think it has 10 medicines that it has put through. Not to be critical, but in one case I'm aware of, the medicine they approved for funding actually has no New Zealand patients, so no one is actually eligible to get this medicine for a rare disorder in New Zealand.
Young patients are eligible, but at the moment we don't have any young patients with this particular rare disease. It was modelled, I think, on the Scottish rare disease fund, so it's a separate amount of money, but when someone inquired under an official information act request to Pharmac, they found out that the money wasn't referenced for that fund at all.
They're just reviewing that fund at the moment. As Heather said, it's quite full, because the medicines are quite expensive. It's not for a lot of people, and Pharmac buys on behalf of the entire population of the community of New Zealand.
Liberal
Darshan Singh Kang Liberal Calgary Skyview, AB
Are they reviewing that secret fund they have there? How long does it take for somebody to tap into that fund? Is it efficient, or is it a tedious kind of process if somebody requests some special medication?
General Manager, Medicines New Zealand
You go through the same process for the rare disease medicines that you go through for every other medicine. The process is identical. There is no difference. It's just actually about how you calculate. The cost-utility analysis becomes quite difficult when you have so few patients, and I think that's why a separate fund was set up within the broader community pharmaceutical budget, although, as I said, it—
Liberal
Darshan Singh Kang Liberal Calgary Skyview, AB
Does that mean that a medicine may not be on the formulary, if we're talking about some special medication?
General Manager, Medicines New Zealand
Because it's for a small population group, it's not necessarily on the formulary, but it will have to be listed through Pharmac.
Liberal
Darshan Singh Kang Liberal Calgary Skyview, AB
Thank you.
How transparent are decisions for funding pharmaceuticals in your nation's system? Are the negotiations open to the public in any way, and if not, why not?
Chair of Board, Head Office, Medicines New Zealand
We think that transparency, or lack of transparency, is a significant issue. That happens at a number of different levels. The area that we are most concerned about is that in the best practices of a health technology assistance system, you wouldn't have your advisory committee as part of the pharmacare system. It should be independent and stand outside of that, but in New Zealand it doesn't. It's all part of the same organization.
The committee is operated by Pharmac. It makes recommendations to the board, so they're making recommendations to themselves, basically. We think that is problematic. There is a lack of transparency. As Graeme described before, we don't know how their assessments are made. We speak often to Pharmac and ask for explanations, but they're very reluctant to shed any light on how they go about making those decisions.
Given that low-priority medicines are often funded ahead of high-priority medicines that might be more expensive, the conclusion we often come to is that these decisions are made on financial grounds rather than on quality scientific grounds.
Liberal
Darshan Singh Kang Liberal Calgary Skyview, AB
We are always talking about cost-effectiveness, but quality of life is also important. Chronic health problems are persistent and costly for many, so how does having universal pharmacare affect the quality of life for those people?
General Manager, Medicines New Zealand
I will use diabetes as an example. One in 16 New Zealanders has type 2 diabetes, so there are about 250,000 type 2 diabetics in New Zealand in a population of 4.7 million.
Again, it's not just us saying this. I understand, from looking at your formulary, that diabetics in Canada can get access to three different classes of diabetes medicine, such as GLP-1s, DPP-4s, etc.
In New Zealand we have metformin and sulfonylureas and insulin, which is more for type 1 diabetics. Clinicians and specialists have basically argued in the public domain that type 2 diabetics need to have access to some, not all, of these medicines, because they help reduce the comorbidities of diabetes, which at the moment cost New Zealand about $1.1 billion a year.
These are medicines that you get in Canada. These are medicines that are recommended in international guidelines for the treatment of diabetes, and at the moment type 2 diabetics in New Zealand aren't getting access to them. Mainly it's 10% to 20% of type 2 diabetics who actually really need these. It's great to have metformin, but we need these other medicines.
It comes down to getting a good balance. It does have an impact on the chronic disease burden if you're not getting the right treatments that clinicians know would make a difference.
Chair of Board, Head Office, Medicines New Zealand
The flow-on effect, obviously, is that the costs to the health system overall are much greater further down the track when we don't treat chronic conditions that could have been dealt with more cheaply earlier on.
