Should patients in Rome or Detroit have faster access to new prescription drugs than someone living in Victoria or Windsor? If your answer is “no,” then here is another query: Why do government agencies tasked to approve or deny new drugs in Europe and the United States (agencies which presumably have the same high standards as Canada) act faster than Health Canada?
According to the most recently available comparable data, when compared with the European Medicine Agency (EMA) and the American Food and Drug Administration (FDA), Health Canada took the longest to approve new medicines in most years observed. The Europeans were quicker in every year surveyed (between 2006 and 2010) as were the Americans in six of the last seven years studied (between 2004 and 2010).
Canada has occasionally followed the FDA’s lead in pulling a prescription drug off the market for safety reasons — which is good for Canadians. But if we trust the FDA in this area, why don’t we trust the FDA in the realm of drug approvals? There is no reason why Canadians should wait for a new medication already approved and available elsewhere in the developed world.
It is expensive for manufacturers to re-apply for approval every time they want to bring a new drug to market — which adds to the price of drugs that both individual Canadians and taxpayers must pay. But more importantly, Health Canada’s slower approval process could harm patients who need the new drugs quickly. The federal government could correct these problems by harmonizing with the Europeans and Americans on regulatory approvals.
The problem is magnified by lengthy delays in provincial government reimbursements for new drugs, affecting those that rely on public drug plans.
Once a new drug has been approved as safe and effective by Health Canada, provincial regulatory agencies must decide whether or not the new medication will be publicly covered under their respective drug plans — a process that takes far longer than it should. For example, Canadians (averaged across all provinces) reliant on public drug plans waited an additional 17 months on average for access to new drugs after their approval by Health Canada in 2009. Overall, those eligible for public drug coverage were forced to wait almost three years before gaining access to new prescription medications that were approved in 2009.
In many cases, patients are denied reimbursement by their respective provincial drug plans. As of Jan. 1, 2012, and averaged across all provincial public drug plans, only 19% of the new drugs approved by Health Canada in 2009 were eligible for public reimbursement. But actual approvals vary dramatically among the provinces: for instance, 40% of those drugs were approved for public reimbursement in Quebec compared to 4% in Manitoba.
This should come as no surprise since decisions regarding public drug coverage are highly politicized and are largely based on budget constraints. Nevertheless, there is one way to improve access to new drugs for those dependent on public assistance to pay for their medication: Get governments out of the drug insurance business.
Data show that private drug insurers in Canada approve new drugs far more rapidly than public insurance plans, and cover more new drugs altogether. In contrast to public drug plans, on average across the provinces, 82% of new drugs approved by Health Canada in 2009 were covered by at least one private insurer as of the beginning of 2012.
Therefore, one practical solution is to replace public drug plans with means-tested subsidies for those with catastrophic drug costs relative to income; health consumers in need could then purchase a private drug insurance plan of their choice in a competitive market.
Critically, this sensible reform would reduce the delay for obtaining new medicines; allow low-income patients to choose the drug plan that best meets their medical needs; and ultimately reduce government-imposed restrictions on consumer choice.
Through international co-operation on the drug approval process and by replacing bureaucratic public drug plans with private plans and targeted subsidies for those with low incomes, needed drugs could more quickly be made available to those in medical and financial need.
Mark Rovere is associate director of health policy studies at the Fraser Institute.