Health Committee on May 2nd, 2016

[The Chair, Liberal, Bill Casey]

I'd like to welcome everybody to meeting number 9. Today is a special day because it's the birthday of Darshan, one of our committee members.

Although we sang Happy Birthday for the Queen the other day, we're not going to sing Happy Birthday for you, but we do wish you well. Many happy returns of the day, Darshan.

We're going to do a little committee business first. We have two issues to deal with. One is a motion by John Oliver.

John, could you read your motion?

[John Oliver, Liberal, Oakville, ON]

Thank you very much. It reads:

That, in relation to Orders of Reference from the House respecting Bills,

(a) the Clerk of the Committee shall, upon the Committee receiving such an Order of Reference, write to each Member who is not a member of a caucus represented on the Committee to invite those Members to file with the Clerk of the Committee, in both official languages, any amendments to the Bill, which is the subject of the said Order, which they would suggest that the Committee consider;

(b) suggested amendments filed, pursuant to paragraph (a), at least 48 hours prior to the start of clause-by-clause consideration of the Bill to which the amendments relate shall be deemed to be proposed during the said consideration, provided that the Committee may, by motion, vary this deadline in respect of a given Bill; and

(c) during the clause-by-clause consideration of the Bill, the Chair shall allow a Member who filed suggested amendments, pursuant to paragraph (a), an opportunity to make brief representations in support of them.

Mr. Chair, this is following a prior committee process. It ensures that MPs from non-recognized parties will be able to move amendments during the committee process and gives MPs from non-recognized parties a much bigger role in committees. That's the intent of the motion.

[The Chair, Liberal, Bill Casey]

Thank you very much.

Is there anyone at the table who would like to address this?

Ms. May.

[Elizabeth May, Green, Saanich—Gulf Islands, BC]

Thank you, Mr. Chairman.

We spoke briefly earlier and you said not to take too much time. Do you have a rough idea of how much, so I can keep track of my time?

[The Chair, Liberal, Bill Casey]

Yes, just a couple of minutes, please. We have witnesses.

[Elizabeth May, Green, Saanich—Gulf Islands, BC]

This motion is being presented to this committee as though it somehow advances the rights of people who are members of Parliament in my position, that being a member of a party with fewer than 12 MPs, or an independent MP. It is in fact exactly the contrary. It is all about an abuse of power by a majority party to restrict the rights of smaller parties.

In the last Parliament, members of the Liberal Party and members of the New Democratic Party voted against this very same motion restricting the rights of people in my position, people who are members of a party with fewer than 12 MPs.

As for the origins of this, to go back to it briefly, the ability to present amendments at report stage used to be unrestricted for any member of Parliament, but in 1999 the Reform Party brought forward over 700 amendments. They were mostly frivolous and dilatory, but their intention was to stall the Nisga'a treaty.

It took a couple of years for the governing party of the day, the majority Liberals of the day, to change the rules to say that if you, as member of Parliament, had an opportunity to put forward a motion, an amendment, in committee, you did not have the right to put forward an amendment at report stage. Just to repeat that, members of recognized parties at that stage had the rules changed so that you could not put forward a substantive amendment at report stage because you had a right as a member of a committee. That meant that those of us in smaller parties who can't sit on committees as full members still had this right to bring forward a substantive amendment at report stage.

I think I'm the only MP who ever discovered that this was the case, and I used it in the 41st Parliament to bring forward important amendments. As I said before, my rights in this regard were supported by the Liberals and the New Democrats.

In the fall of 2013, the Conservative majority brought forward this new idea. Rather than change the rules as we find them under O'Brien and Bosc, every single committee passed an identical motion. The effect of this was that I and all members of Parliament in my situation would then be invited to show up to committee. This was really coercion, not invitation. I would present amendments, sometimes with 60 seconds to defend my amendment, and was not allowed to answer questions about it after the fact.

The effect was that if two committees were meeting at the same time at clause-by-clause, which often happens, I'd be running from committee to committee to try to meet the invitation from committees to get my amendments in and considered. It is an enormous imposition of additional work for the sole purpose of depriving members of Parliament from smaller parties of being able to present amendments at report stage.

It's an abuse of power, and I have to say that it's heartbreaking to see it being done again. Such motions by the committee die at the end of every Parliament, which is why every single committee is being asked today to pass the former majority Conservative motion through committee. I would beg of you: please don't pass this motion.

[The Chair, Liberal, Bill Casey]

I just want to say that perhaps you and I are the only ones on the committee who have been in your position as either independents or as members of a one-person party. It is really difficult. I can sympathize with your position. You just can't be everywhere, as parties with dozens of members can be.

It's not possible to make it easy for you. I know how hard you work and how committed you are to everything. All I can tell you is that if this motion passes today, this committee will hear you and give you the opportunity to speak generously at any time. That's the only thing I can offer you.

It's just not possible for Parliament to accommodate one person, either you or me, in the same way it accommodates parties with dozens of people. That's all.

[Elizabeth May, Green, Saanich—Gulf Islands, BC]

With your permission, I'm not asking for special accommodation. I'm just asking for the rules as they currently are in the rules of House of Commons Procedure and Practice. Our rule book, O'Brien and Bosc, is fine with me. I can present amendments at report stage, and I will not abuse the right to present amendments at report stage. However, report stage happens once a day in one place, not in multiple places at multiple times on multiple bills simultaneously.

This is a very damaging motion to the rights of MPs in smaller parties. Or, if any of those currently sitting with a party should become independents over the next period of years, which is the experience that you've had, Mr. Chair, it will definitely not be easy. This makes it so much harder.

I'm very bitterly disappointed that the government House Leader has made this decision to ask all of you to pass this. I would ask you, please, to demonstrate to Canadians that we don't have a lot of clouds on sunny ways.

[The Chair, Liberal, Bill Casey]

Mr. Davies.

[Don Davies, NDP, Vancouver Kingsway, BC]

I have a couple of comments and an important question. With great respect to my colleague, Ms. May is not the only person who has proposed amendments at report stage in the House. I don't think I'm hurting her to say this, because other parties, including the New Democratic Party and probably members of all parties, have proposed amendments in the House at report stage, but I'm sympathetic to her point here.

My question has to do with this: I'm unclear, if this motion were to pass, whether it means that members of Parliament may only present amendments to legislation at committee and therefore are totally precluded from doing so at report stage in the House—which I believe, if I'm not doing violence to Ms. May's position, is her position. She she may be right, but I have checked with our parliamentary advisers, who suggest to me that this is not completely the case: it's only those amendments, they say, that are presented at committee that can no longer be moved at report stage in the House, meaning that other amendments could be moved at report stage in the House, as long as they were not made in committee.

I had a chance to chat with Ms. May, and if I understand her position correctly, she thought that if this motion were to pass, it would mean that a member would be precluded from moving any amendments at report stage in the House because they had had a chance to move them in committee.

I wonder whether anybody knows the answer to that, because it would make a difference to of how I view this—

[The Chair, Liberal, Bill Casey]

John, do you have a comment?

[John Oliver, Liberal, Oakville, ON]

Mr. Chairman, I read the motion. It specifically deals with members of caucus who are not members of an established party, so I think it's a fairly narrow motion, as written, for that group.

[The Chair, Liberal, Bill Casey]

That's my understanding, yes.

[Elizabeth May, Green, Saanich—Gulf Islands, BC]

May I attempt to answer Don's question?

I've lived with this, and believe me, after several points of order and arguments with the Speaker in the 41st Parliament, there's a distinction at report stage between a substantive amendment and a deletion.

Any member of Parliament, including a member of a non-recognized party, after the so-called opportunity created by this oppressive motion, will still have the right to present deletions at report stage. With this motion in place, no member of Parliament would have the right to present substantive amendments at report stage, whether they had been tabled before committee or not. That's the distinction.

The ability that was supported by the Liberal and New Democratic Party, for instance, with regard to the spring omnibus budget bill of 2012.... This motion is the direct result of an attempt to punish me by the previous Conservative majority for fighting effectively against Bill C-38 in legion with Liberal and New Democratic Party MPs who did not want to see the damage that would happen due to Bill C-38. I put forward 423 amendments to Bill C-38, the omnibus budget bill. The Speaker grouped them and we voted. Voting took 24 hours straight, and that's why they brought forward these motions.

First they—in this case Peter Van Loan—tried to get the Speaker to rule that members such as me would have one amendment pulled out of the pack. If that one amendment failed after being put to a test vote, none of the rest would be heard. The Speaker said that it violated the principle of this being a parliamentary democracy, and so that was rejected.

However, the Speaker opened the door by saying, well, if there's some opportunity created.... We've now tried this so-called opportunity and the Speaker said it would have to be satisfactory to members. It's certainly not satisfactory to me. I've lived with it since the Fall of 2013 and it's really very difficult running from committee to committee.

I hope that answers Don's question. Yes, anyone can put forward amendments as deletions at report stage, but nobody can put forward substantive amendments if this motion passes.

[The Chair, Liberal, Bill Casey]

Mr. Oliver.

[John Oliver, Liberal, Oakville, ON]

We have an extensive committee meeting before us. We have panellists here to speak. There's been a very generous opportunity for the member to express her views and concerns regarding the motion. At some point, we need to move forward with the planned agenda of our meeting.

[The Chair, Liberal, Bill Casey]

Mr. Davies.

[Don Davies, NDP, Vancouver Kingsway, BC]

I totally understand Ms. May's description of it, but, again, I'm receiving different information from that. I would suggest that we stand this motion to our next meeting, so that we can clarify what exactly are the rights of a member to table motions at report stage. It would make a difference as to how I might vote on this. I don't see any particular urgency on this issue.

I would propose, with respect to Mr. Oliver's comments, that we get to the matter at hand and simply put this over to our next meeting.

[The Chair, Liberal, Bill Casey]

Is that a motion?

[Don Davies, NDP, Vancouver Kingsway, BC]

Yes, it is.

[The Chair, Liberal, Bill Casey]

All in favour of the motion to stand this and carry it on at a future meeting?

All against?

(Motion negatived)

We will now move to the motion.

My understanding is that this motion allows you, or any independent member, to make written submissions to any committee, defend them, and then propose amendments. You cannot do this now. It may restrict you in some ways, but it gives you a whole lot more open ability to speak your mind. Many people say that members of Parliament do their best work at committee.

[Elizabeth May, Green, Saanich—Gulf Islands, BC]

Not handcuffed, but that's okay.

[The Chair, Liberal, Bill Casey]

We've heard the motion.

All those in favour of Mr. Oliver's motion?

All against?

(Motion agreed to)

All I can tell you is that if you ever come here, the Chair will be very generous in hearing your points.

The second issue is that we have to decide whether we're going to consider the appointment of Dr. Siddika Mithani to the office of president of the Public Health Agency. Our committee can debate that appointment, analyze it, and pass judgment on it, or not.

Is it the will of the committee to have a debate on that appointment?

That said, there doesn't seem to be any interest in that. I'm going to assume that's a nay and we will not question her appointment.

We're going to move to our agenda. Today, we have Mr. William Dempster, CEO of 3Sixty Public Affairs; Mr. W. Neil Palmer, president of PDCI Market Access; and Dr. Graham Sher, CEO of Canadian Blood Services.

Whoever wants to go first, you have 10 minutes. When your 10 minutes are up, we'll ask you questions.

Mr. Palmer.

[W. Neil Palmer, President and Principal Consultant, PDCI Market Access]

Thank you, Mr. Chair. I'll be going first. Then it will be Mr. Dempster, and Mr. Sher will be batting cleanup.

Good afternoon. My name is Neil Palmer. I am president of and principal consultant with PDCI Market Access. Appearing with me today is Dylan Lamb-Palmer, manager of health economics and analytics at PDCI.

The opinions expressed today are strictly our own. We are not here to advocate on behalf of any third party. Although our clientele are often pharmaceutical manufacturers, we are not advocates for the pharmaceutical industry; however, our consulting work provides first-hand insights into the mechanics of pharmacare in Canada, experience that underpins our policy and research activities, including our studies on the cost of national pharmacare.

By way of background, I have more than 30 years' experience in the health care sector, including six years with the Patented Medicine Prices Review Board, where I was involved in the development and application of the PDCI pricing guidelines, most of which are still in effect today. I also have significant experience with the international pricing and reimbursement of pharmaceuticals and give lectures on that subject matter at the University of Southern California graduate program in health care decision analysis.

As you know, PDCI was commissioned by the Canadian Pharmacists Association, or CPhA, to prepare a cost study of national pharmacare and address the findings of the Morgan et al analysis that was published in the CMAJ and reproduced in the Pharmacare 2020 report. We also assessed pharmacare alternatives that provide universal coverage without dismantling or disrupting our current pan-Canadian health care system.

In our view, the national pharmacare discussion should be based on thorough and thoughtful analyses informed by a range of perspectives, expertise, and experience, and open to respectful consideration of a range of policy options. We believe it's important to begin by identifying the problems that national pharmacare is intended to solve, so let's start where there is general agreement.

First, there is a coverage gap. Not all Canadians have access to the prescription drugs they need, and costs may be a barrier for patients, even those with basic coverage. Figures of 10% to 20% with no coverage or inadequate coverage are frequently cited. However, the underlying data supporting these figures is weak and generally based on unreliable opinion surveys. That 10% to 20% could be underestimate or an overestimate. Either way, we need to know.

We need to know because it's not possible to make informed policy recommendations and decisions when there is such uncertainty. This is an area where the federal government can make a vital contribution. The federal government should commission Statistics Canada, Health Canada, or an appropriate outside agency to conduct a thorough, comprehensive survey of prescription drug coverage in Canada. The study should also examine the extent to which deductibles and copayments are barriers to access.

Second, prescription drug coverage should not depend on where you live. Comparable coverage should be available throughout Canada, but coverage need not be identical. Much like our provincial health care systems, which all respect the core principles of Canadian medicare, they are similar but not identical.

This is an important point. Unlike other countries, Canada does not have a national health care system, and here there is a disconnect. National pharmacare makes sense in the context of a national health care system, but we do not have a national health care system. Moreover, national pharmacare is proposed with further decoupled responsibilities for drugs from health care funding. This will only exacerbate the silo funding mentality. The more detached pharmacare is from the provincial health care system it serves, the less informed its decision-making.

Next, I would like to discuss the concept of a national formulary, something that is often proposed as an integral part of national pharmacare. Our analysis suggests that greater than 90% of drug products are common to all plan formularies or are made available through alternative programs in the particular province, such as through a cancer agency, so a national formulary would largely replicate what is already in place.

Nevertheless, it would be useful to conduct a thorough comparative analysis of benefits on provincial drug benefit plans and programs to assess the degree of commonality and identify the therapeutic areas where there is discordance. This is a study that could be undertaken by the national prescription drug utilization information system, NPDUIS, by the Canadian Institute for Health Information, or by IMSL.

The third area of agreement is that the selection of prescription drugs for reimbursement should be evidence-based. In fact, to varying degrees, the provincial drug plans have always applied an evidence-based approach. Since 2003, new drugs have been reviewed—except in Quebec—by the common drug review of the Canadian Agency for Drugs and Technologies in Health, or CADTH. The process of CDR consists of a thorough examination of clinical and cost effectiveness and provides consistent evidence-based listing recommendations to the provinces. In Quebec, INESSS provides a similar evidence-based approach for listing drugs in that province.

The fourth area of agreement is that significant buying power is essential for negotiating the best prices for the public drug plans. With modest beginnings in 2010, the pan-Canadian Pharmaceutical Alliance or pCPA now negotiates prices on behalf of all public plans, including those in Quebec and the federal plans. In fact, the pCPA is a remarkable yet unheralded public policy success story. Till recently, the pCPA had no dedicated resources and relied entirely on the drug plan managers in each of the jurisdictions, who through good will and collaboration have developed organically what has become a world-class mechanism for negotiating product listing agreements. The pCPA has completed over 100 negotiations and saves almost half a billion dollars annually, savings that will only continue to expand as every new drug is added to the pCPA process. Moreover, the pCPA is now conducting class reviews of established drugs and has lowered the prices of generic drugs to between 18% and 25% of the original brand price in most cases, benefiting all Canadians. In fact, the pCPA has become so successful that private drug plan insurers want in as well.

To date, the pCPA has not opened its doors to private insurers, perhaps because the private plans are primarily for profit, and are quite capable of negotiating their own listing agreements. For example, new initiatives to control private drug plan costs, such as Manulife's DrugWatch program, are sparking considerable interest and some controversy.

And what of the public versus private debate? Proponents of national pharmacare suggest that eliminating private drug plans could be achieved with only modest cost to government. We disagree. If public, private and out-of-pocket expenditures were to be combined into a single national plan, we estimate that the total cost savings of approximately $1 billion could be realized over total expenditures, but there would be a significant shift of spending to the public sector of approximately $8 billion in 2015.

Nationalizing private drug plans in the name of national pharmacare would not only shift significant cost to the public sector, it would also be highly disruptive for employers and employees, and at the same time provide no improvement in health status. Moreover, these benefits are negotiated in collective agreements. Unions would be unlikely to give up their drug coverage without something in return.

Morgan et al. suggest that by combining public and private systems, it would be possible to achieve Canadian prices as low as those in the U.K., even though the U.K. has a much larger population and a much different mechanism for funding drugs. In England there are 209 clinical commissioning groups or CCGs. CCGs are physician-led statutory health organizations responsible for the planning and commissioning of health services for their local area. Each CCG maintains its own formulary and is assigned a fixed drug budget. There are some concerns with the U.K. approach. Although fixed budgets help control costs, they can be a barrier to the uptake of new medicines. As a result, U.K. physicians are slower to adopt new medicines into their practices, and this has been an area of concern, particularly for cancer drugs.

In the face of considerable ongoing criticism, the government was forced in 2010 to establish a special cancer drugs fund in addition to the regular funding mechanisms in England. The impact of poor access to drug plans regularly makes headlines in the U.K. including those in a recent article in The Guardian that highlighted the findings of a comprehensive review article in The Lancet, a leading medical journal. The Lancet study concluded that five-year survival rates for U.K. patients across a wide range of cancers trailed those for most leading nations, including Canada.

It's important to consider international price comparisons in context. Morgan, citing PMPRB, points to prices in the U.K. being 23% lower than in Canada. This 2013 figure is highly sensitive to exchange rate yet accounts for almost two-thirds of the savings proposed by Morgan. One year later, in 2014, U.K. prices were 14% lower than Canadian prices, according to the PMPRB, a change of 9%, or almost $2 billion of Morgan's savings lost in just one year.

A more robust analysis would have taken into account the volatility of exchange rates and considered purchasing-power parities instead of market exchange rates.

To the extent that pharmacare policy decisions are to be informed by international price comparisons, it's critical that there be proper context with transparent discussion of the underlying exchange rates, health care systems, and appropriate sensitivity analysis. The PMPRB already limits Canadian prices to international comparators. The PMPRB also limits prices of new drugs to prices of other drugs in the same therapeutic class, and limits price increases to inflation. In fact, Canadian price increases typically average less than one percent each year.

However, to some the PMPRB has lost its relevance. Nevertheless, the PMPRB is an important component of pharmaceutical cost-containment in Canada. The federal government can do its part by clearly defining the PMPRB's mandate so that it realigns its priorities to be in line with the priorities of the provinces, pCPA, private plans, and consumers, and by removing the jurisdictional uncertainty that leads to unproductive litigation. Parliament and not the courts should determine PMPRB's mandate.

In summary, we have an evolving pan-Canadian version of pharmacare, one that's integrated into the underlying provincial-territorial health care systems that pharmacare serves. There's still much work to be done. All Canadians must have access to affordable drug coverage, and as I have already suggested, we need a comprehensive study to assess and address that coverage gap.

Similarly, we need to assess if there are any important disparities in terms of drugs that are covered across jurisdictions. These are initiatives where the federal government can take a leadership role.

Finally, the focus of Canadian pharmacare discussion should be to extend and improve coverage to those within adequate coverage, not weaken the drug benefits of the large majority of Canadians that currently have good coverage.

Thank you.

[The Chair, Liberal, Bill Casey]

Thank you very much.

I have one question. What does PDCI do?