PHARMACEUTICALS MANAGEMENT
What did governments promise?
The 2003 First Ministers’ Accord on Health Care Renewal committed governments by the end of 2005/06 to ensure that Canadians, wherever they live, have reasonable access to catastrophic drug coverage. As a priority, the First Ministers agreed to further collaborate to promote optimal drug use and best practices in drug prescribing, and to better manage the costs of all drugs, including generic ones, to ensure that drugs are safe, effective and accessible in a timely and cost-effective fashion.  The 2004 10-Year Plan to Strengthen Health Care directed health ministers to establish a task force to develop and implement a National Pharmaceuticals Strategy and report on progress by June 30, 2006. The strategy was to include: cost options for catastrophic drug coverage, a national formulary for participating jurisdictions, faster access for breakthrough drugs, better monitoring for safety and effectiveness, purchasing strategies, action to influence prescribing behaviour, action to support electronic prescribing, and an analysis of cost drivers and cost-effectiveness in drug plan policies. In October 2005, health ministers met and reaffirmed their commitment to the National Pharmaceuticals Strategy. At that time, they asked their
officials to:
| - | Accelerate the work on catastrophic drug coverage and to undertake research on expensive drugs for two rare diseases – Fabry’s disease and MPS1-Hurler Schie syndrome;
| | - | Expand the scope of the Common Drug Review (the national committee that recommends whether drugs should be funded) to consider all drugs, not just new ones;
| | - | Work towards a common national formulary (a listing of drugs that are approved for public funding);
| | - | Give the Patented Medicine Prices Review Board (PMPRB) responsibility to monitor and report on non-patented drug prices; and
| | - | Collect, integrate and disseminate information on the real-world risks and benefits of drugs. |  Managing Frank's Diabetes
Where are we now?
The 2003 Accord commitment to ensure reasonable access to catastrophic drug coverage by the end of 2005/06 was substantially reduced in the 2004 10-Year Plan, which requires governments only to report on progress on the National Pharmaceuticals Strategy by June 30, 2006, not to actually ensure that drug coverage is in place by that time. Although cost options for catastrophic drug coverage will be part of this reporting, it is not at all clear whether Canadians without catastrophic drug coverage can expect to have it by the end of June 2006. Meanwhile, 600,000 Atlantic Canadians remain without drug plan coverage and more than two million Canadians have coverage that does not protect them from catastrophic costs.
Prescription drugs have become a major part of Canadian health care. CIHI estimates that we spend more on drugs – $20 billion a year – than on any other health care sector except hospitals.10 Drugs are the fastest growing component of health care budgets, with 10 per cent increases annually over the last 10 years – a rate of increase several times faster than general economic growth over the same decade. Canadian research shows that we are spending more on drugs because more people are being prescribed drugs for longer periods of time, and prescribing providers often select newer and more costly drugs over effective and safe but cheaper alternatives.11 The National Prescription Drug Utilization Information System (NPDUIS) is a joint initiative of the PMPRB and CIHI. The system is a national database coupled with analytical capacity that tracks and analyses prescription drug use across the country. NPDUIS is helping public drug plans make informed decisions and create evidence-based management policies.
Appropriate Prescribing
Without population-based information about the appropriateness of these changing utilization patterns, it is hard to assess whether increased usage has resulted in improved health. Are the right drugs getting to the right people at the best price? Indeed, while we witness huge growth in spending on prescription medications, concerns are also growing about prescribing behaviours and their effect on patient outcomes. Studies in Canada have shown: | - | Approximately one-third of seniors are prescribed drugs that are either ineffective in the elderly or that put them at unnecessarily high risk when safer alternatives are available.12
| | - | More than 30,000 Ontario seniors in one year were given at least one drug that should be avoided in the elderly.13
| | - | In a study in Saskatchewan, over 15 per cent of seniors living in the community and 28 per cent living in long-term care facilities regularly received at least one drug from a list of high-risk, potentially avoidable medications for the elderly.14
| | - | In another Ontario study, heart failure patients with a high risk of death were the least likely to receive life-sustaining prescription medications (such as ACE inhibitors, which dilate the blood vessels).15
| | - | For most patients who experience an adverse event after being discharged from hospital, the cause is related to the use of multiple medications with known interactions, medications that should not be used together, or inadequate monitoring of medication use.16
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Electronic Information Management
A growing number of provinces are developing electronic drug information systems that will track the use of prescription medications by all residents and ultimately provide useful information to assess safety, costs, access and health benefits. “E-Therapeutics” is another emerging system with information on clinical practice guidelines for prescribing, drug costs, coverage and safety. Both of these systems should be linked with other patient health information systems to create a fully integrated record of patient care and health status. (Electronic drug information systems and e-Therapeutics are discussed further in the section “Pathway Two: Improve Quality of Care.”)
Drug Costs and Public Coverage
Drug expenditures vary across jurisdictions, as does the amount covered by public drug plans (Table 6).17
 Table 6. Drug Expenditures by Jurisdiction, 2002*
Both public and private drug plans have used a variety of financial policies in an attempt to control costs. Some have focused on increasing co-payments and deductibles for patients. Others have focused on ensuring access to expensive drugs for those patients who can benefit from their use, while not funding patients who would be well served by less expensive but equally effective therapies. Particular success has been achieved in some jurisdictions in Canada with reference-based pricing, which limits the amount a plan will pay for interchangeable drugs.18 Usually the price is set at the lowest cost drug that is equally safe and effective as higher cost alternatives. Research shows that reference-based pricing is a valuable tool to control drug costs without sacrificing effectiveness or safety. As public drug plans attempt to manage costs, there is increasing evidence from the United States that private employer plans are struggling with similar issues. For example, Wal-Mart is considering a shift to hiring more part-time workers, who are not eligible for drug coverage, and adding physically demanding duties to job descriptions to discourage less healthy people from applying for positions.19 General Motors has announced a reduction in health benefits for their employees and retirees.20
Direct-to-Consumer Advertising
Complicating the story is an increase in advertising for prescription drugs directed at consumers. Canada’s Food and Drugs Act contains a broad prohibition on advertising prescription-only drugs to the public. However, gradual changes in the interpretation of this legislation and increased exposure to US advertising have led to a greater presence of prescription drug ads in the Canadian media. So-called “help-seeking” ads are those that do not mention a specific brand name but suggest that people speak with their physician about an unspecified treatment. “Reminder” ads include only a brand name but make no health claims. Both of these types of ads are allowed under Canadian law, yet neither type is required to provide any information on the health risks, the cost of the product, or how it compares with similar drugs.
The Health Council recently reviewed the existing research on direct-to-consumer advertising to assess whether advertising results in positive patient outcomes or patient safety benefits.21 In summary, we found no reliable evidence that direct to- consumer advertising improves patient compliance in taking medications, leads to a more appropriate early diagnosis of an under-treated condition, or prevents hospitalizations or serious disease consequences. As well, physicians report that there is a direct link between requests for medication and exposure to advertising: patients who have a higher exposure to direct-to-consumer advertising ask for specific medications more so than patients who are less exposed. The Council could not find any evidence to support a relaxation of direct-to-consumer advertising rules in Canada.
Where are the roadblocks?
| - | Coverage for prescription medications continues to be uneven across Canada, leaving an unacceptably large number of Canadians with minimal or no protection against catastrophic drug costs.
| | - | Increasing costs and evidence of patient safety concerns underscore the need for better management of prescription medications.
| | - | Not all jurisdictions have adopted practices such as reference-based pricing. We can save money while maintaining the quality of care if we focus policies and drug plan management on “good but less expensive” products. Some jurisdictions have already realized savings from directly linking evidence-based prescribing protocols and policies with lowest cost therapies.
| | - | Electronic systems are needed to link information about drug products, patients and their medications. This will ensure that prescribing is based on scientific evidence and reduce adverse events caused by medication errors.
| | - | Despite a lack of evidence of benefit, US-to-Canada broadcasting of direct-to-consumer prescription drug advertising continues, along with made-in-Canada “help-seeking” and “reminder” ads. Further relaxing Canada’s prohibitions on direct-to-consumer advertising would not be in the best interests of Canadian patients or the health care system. |
What needs to be done?
 | Focus on individuals without drug coverage. In Atlantic Canada, 600,000 people remain without drug coverage and millions more have coverage that does not protect them from catastrophic costs. They need to be reassured that the National Strategy on Pharmaceuticals will give them access to needed medications at a reasonable personal financial cost. Canadians deserve an actual plan for implementation with clearly specified target dates by June 30, 2006.
|  | Continue to develop processes that support evidence-based decision-making about prescribing and drug coverage. To manage costs, it is more equitable and more supportive of population health to base prescribing and coverage decisions on science, rather than arbitrarily reducing the number of beneficiaries or increasing deductibles and co-payments. Governments can save money through tighter management of their drug plans, cross-jurisdictional cooperation and improved prescribing behaviours. Such improvements will also enhance government ability to provide coverage for high-cost medications with a proven health benefit.
|  | Continue to develop population-based drug information systems linked to other patient health information. Electronic record systems are the only way to create fully integrated patient information and the only way to assess the impact of prescription medications on patient outcomes and the cost to the health care system. This information should be made readily available to support national initiatives that inform governments and support the monitoring of the safety and effectiveness of prescription drugs.
|  | Strengthen legislation to ban all forms of direct-to-consumer advertising of prescription drugs in Canada. Legislation should clearly prohibit “help-seeking” and “reminder” ads. | 
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