On June 24, the Patented Medicine Prices Review Board (PMPRB) published the PMPRB Guidelines Modernization – Discussion Paper (Discussion Paper)1 in which it announced that, in response to high patented medicine prices and low R&D investment in Canada, it is undertaking public consultations regarding a possible reform of its Compendium of Policies, Guidelines and Procedures (Guidelines).

What You Need To Know

  • The Guidelines outline how PMPRB staff determines whether the price of a patented medicine is excessive.
  • The PMPRB is seeking written comments on a series of questions; specific changes to the Guidelines are to be proposed based on the feedback received. The questions relate, generally, to:
    • how excessive pricing should be identified;
    • whether other aspects of the Guidelines warrant reform;
    • whether any changes to the Guidelines should apply to all patented medicines or only those introduced subsequent to the changes; and
    • whether there should also or alternatively be changes to relevant regulation or legislation.
  • The deadline for submitting written comments to the questions is October 24, 2016.
  • The PMPRB anticipates it will publish its proposed changes to the Guidelines for comment in the spring or summer of 2017.

The Discussion Paper hints that the PMPRB may propose a number of reforms to the Guidelines which would likely lower the maximum allowable prices of many patented medicines at and after introduction.

In particular, the Discussion Paper suggests the PMPRB may support reforms that would change how it determines whether the price of a medicine is excessive at introduction. These reforms could involve: (i) conducting initial screenings based on indicators of potential for patent monopoly abuse rather than levels of therapeutic improvement; (ii) either changing the composition of the countries used for international price comparisons, or lowering price ceilings relative to the currently considered countries; and (iii) lowering price ceilings at introduction for drugs providing slight or no therapeutic improvement relative to other drugs sold in Canada.

The Discussion Paper also suggests the PMPRB may support reforms that would change how it determines whether the price of a medicine is excessive after introduction. These reforms could involve: (i) allowing for a different consideration of the consumer price index, or providing for periodic reassessment of drug prices to determine whether a decrease may be warranted; and (ii) having an assessment of prices in different Canadian markets play a more prominent role in determining whether the price of a patented medicine is excessive.

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1 "PMPRB Guidelines Modernization – Discussion Paper," online: http://www.pmprb-cepmb.gc.ca/en/news-and-events/consultations/current-major-consultations/rethinking-the-guidelines/discussion-paper.

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