Departmental Performance Report

2013-14
Departmental Performance Report

Patented Medicine Prices Review Board

The Honourable Rona Ambrose
Minister of Health

Catalogue number: H79-2/2014F-PDF
ISSN: 2368-1063

Table of Contents

Foreword

Chairperson's Message

Section I: Organizational Expenditure Overview

• Organizational Profile
• Organizational Context
• Actual Expenditures
• Alignment of Spending With the Whole-of-Government Framework
• Departmental Spending Trend
• Estimates by Vote

Section II: Analysis of Program(s) by Strategic Outcome

• Strategic Outcome:
• Program 1.1: Patented Medicine Price Regulation Program
• Program 1.2: Pharmaceutical Trends Program
• Internal Services

Section III: Supplementary Information

• Financial Statements Highlights
• Financial Statements
• Supplementary Information Tables
• Tax Expenditures and Evaluations

Section IV: Organizational Contact Information

Appendix: Definitions

Endnotes

Foreword

Departmental Performance Reports are part of the Estimates family of documents. Estimates documents support appropriation acts, which specify the amounts and broad purposes for which funds can be spent by the government. The Estimates document family has three parts.

Part I (Government Expenditure Plan) provides an overview of federal spending.

Part II (Main Estimates) lists the financial resources required by individual departments, agencies and Crown corporations for the upcoming fiscal year.

Part III (Departmental Expenditure Plans) consists of two documents. Reports on Plans and Priorities (RPPs) are expenditure plans for each appropriated department and agency (excluding Crown corporations). They describe departmental priorities, strategic outcomes, programs, expected results and associated resource requirements, covering a three-year period beginning with the year indicated in the title of the report. Departmental Performance Reports (DPRs) are individual department and agency accounts of actual performance, for the most recently completed fiscal year, against the plans, priorities and expected results set out in their respective RPPs. DPRs inform parliamentarians and Canadians of the results achieved by government organizations for Canadians.

Additionally, Supplementary Estimates documents present information on spending requirements that were either not sufficiently developed in time for inclusion in the Main Estimates or were subsequently refined to account for developments in particular programs and services.

The financial information in DPRs is drawn directly from authorities presented in the Main Estimates and the planned spending information in RPPs. The financial information in DPRs is also consistent with information in the Public Accounts of Canada. The Public Accounts of Canada include the Government of Canada Consolidated Statement of Financial Position, the Consolidated Statement of Operations and Accumulated Deficit, the Consolidated Statement of Change in Net Debt, and the Consolidated Statement of Cash Flow, as well as details of financial operations segregated by ministerial portfolio for a given fiscal year. For the DPR, two types of financial information are drawn from the Public Accounts of Canada: authorities available for use by an appropriated organization for the fiscal year, and authorities used for that same fiscal year. The latter corresponds to actual spending as presented in the DPR.

The Treasury Board Policy on Management, Resources and Results Structures further strengthens the alignment of the performance information presented in DPRs, other Estimates documents and the Public Accounts of Canada. The policy establishes the Program Alignment Architecture of appropriated organizations as the structure against which financial and non-financial performance information is provided for Estimates and parliamentary reporting. The same reporting structure applies irrespective of whether the organization is reporting in the Main Estimates, the RPP, the DPR or the Public Accounts of Canada.

A number of changes have been made to DPRs for 2013-14 to better support decisions on appropriations. Where applicable, DPRs now provide financial, human resources and performance information in Section II at the lowest level of the organization’s Program Alignment Architecture.

In addition, the DPR's format and terminology have been revised to provide greater clarity, consistency and a strengthened emphasis on Estimates and Public Accounts information. As well, departmental reporting on the Federal Sustainable Development Strategy has been consolidated into a new supplementary information table posted on departmental websites. This new table brings together all of the components of the Departmental Sustainable Development Strategy formerly presented in DPRs and on departmental websites, including reporting on the Greening of Government Operations and Strategic Environmental Assessments. Section III of the report provides a link to the new table on the organization’s website. Finally, definitions of terminology are now provided in an appendix. 

Chairperson's Message

I am pleased to present the 2013–14 Departmental Performance Report for the Patented Medicine Prices Review Board (PMPRB).

The PMPRB’s objective to ensure that Canadians do not pay excessive prices for patented medicines is an important one which contributes to the government-wide goal of healthy Canadians.

Over the past fiscal year the PMPRB has focused on improving its programs by monitoring the impact of the Guidelines’ changes and on publishing studies that account for the latest market trends and reflect the immediate interests of both public and private payers. The PMPRB also pursued its outreach activities, expanded and diversified the exchanges with its stakeholders. In addition, the PMPRB became more active and involved with its federal, provincial and international partners.

In the spirit of the Government’s Red Tape Reduction Action Plan, the Board concluded consultations on two initiatives to reduce regulatory burden. First, the Board has simplified the Consumer Price Index (CPI) Adjustment Methodology. The simplified methodology will be implemented in 2015. Second, the Board proposed amendments to the Patented Medicines Regulationsⁱ to move from twice to once a year filing. Work is underway to pre-publish the proposed regulatory amendments in Part I of the Canada Gazette for formal consultation in 2014-15.

Three Board decisions were subject to judicial review by the Federal Court: ratio-Salbutamol HFA (T-1058-11; T-1825-11); ratiopharm Inc. (now Teva Canada) (T-1252-11); and Sandoz Canada Inc. (T-1616-12). The Court heard these matters in November 2013 and released its decisions on May 27, 2014. The Federal Court allowed the applications for judicial review and referred the matters back to the Board with a direction that it find that ratiopharm Inc. and Sandoz Canada Inc. are not patentees for the purpose of Section 79 of the Patent Act and thus outside the Board’s jurisdiction. The Office of the Attorney General filed the Notices of Appeal in respect of these decisions on June 25, 2014.

Despite new challenges and emerging issues, the PMPRB continues to put the protection of consumer interests first, while recognizing the value that innovative medicines offer to patients.

This is only made possible through the collaborative efforts and dedication of the Board Members and its Staff.

Mary Catherine Lindberg,
Chairperson

Section I: Organizational Expenditure Overview

Organizational Profile

Appropriate Minister: The Honourable Rona Ambrose

Institutional Head: Mary Catherine Lindberg, Chairperson

Ministerial Portfolio: Health

Enabling Instrument(s): Patent Actⁱⁱ and Patented Medicines Regulationsⁱⁱⁱ

Year of Incorporation / Commencement: 1987

Other: The Minister of Health is responsible for the pharmaceutical provisions of the Patent Act (Act) set out in sections 79 to 103. The Patented Medicine Prices Review Board (PMPRB) is part of the Health Portfolio, which also includes Health Canada, the Public Health Agency of Canada, the Canadian Institutes of Health Research and the Canadian Food Inspection Agency. The Health Portfolio supports the Minister of Health in maintaining and improving the health of Canadians.

Although part of the Health Portfolio, the PMPRB carries out its mandate at arm's length from the Minister. It also operates independently of other bodies such as Health Canada, which authorizes the sale of drugs in Canada after their assessment for safety, efficacy and quality; federal, provincial and territorial (F/P/T) public drug plans, which are responsible for listing and reimbursement decisions for their respective plans; and the Common Drug Review, administered by the Canadian Agency for Drugs and Technologies in Health (CADTH), which provides listing recommendations to participating public drug plans based on cost-effectiveness.

Organizational Context

Raison d’être

The PMPRB is an independent, quasi-judicial body created by Parliament in 1987. Its mandate is two-fold:

• Regulatory – to ensure that prices charged by patentees for patented medicines sold in Canada are not excessive; and
• Reporting – to report on pharmaceutical trends of all medicines and on research and development (R&D) spending by pharmaceutical patentees.

In carrying out its mandate, the PMPRB ensures that Canadians are protected from excessive prices for patented medicines sold in Canada and that stakeholders are informed on pharmaceutical trends.

Responsibilities

The PMPRB was created as a result of amendments to the Patent Act (Act) in 1987 (Bill C-22), and its remedial powers were strengthened by further amendments in 1993 (Bill C-91). These amendments were part of policy reforms intended to balance the PMPRB’s consumer protection mandate with patent protection measures intended to encourage the research and development efforts of pharmaceutical patentees.

The PMPRB has a dual mandate:

Patented Medicine Price Regulation

The PMPRB is responsible for ensuring the factory-gate prices that patentees charge for prescription and non-prescription patented medicines sold in Canada to wholesalers, hospitals, pharmacies or others, for human and veterinary use, are not excessive. The PMPRB regulates the price of each patented medicine to which Health Canada has assigned a Drug Identification Number (DIN) as part of its review process. The Board's mandate also includes medicines that are available under the Special Access Programme; through a Clinical Trial Application; and Investigational New Drug Products. Over-the-counter (OTC) patented medicines and patented medicines for veterinary use are regulated by the Board on a complaints basis.

In the event that the Board finds, after a public hearing, that the price of a patented medicine is or was excessive in any market, it may order the patentee to reduce the price and take measures to offset any excess revenues it may have received.

Pharmaceutical Trends Reporting

The PMPRB reports annually to Parliament through the Minister of Health on its price review activities, the prices of patented medicines and price trends of all prescription drugs, and on the R&D expenditures reported by pharmaceutical patentees. In addition, as a result of the establishment of the National Prescription Drug Utilization Information System (NPDUIS)^iv by F/P/T ministers of health in September 2001, the PMPRB conducts critical analysis of price, utilization, and cost trends for patented and non-patented prescription drugs so that Canada’s health system has more comprehensive, accurate information on how all prescription drugs are being used and on the sources of cost increases. This function is aimed at providing F/P/T governments and other interested stakeholders with a centralized credible source of information on pharmaceutical trends.

Strategic Outcome and Program Alignment Architecture

1. Strategic Outcome: Canadians are protected from excessive prices for patented medicines sold in Canada and stakeholders are informed on pharmaceutical trends.

1.1 Program: Patented Medicine Prices Review Program

1.2 Program: Pharmaceutical Trends Program

Internal Services

¹ Type is defined as follows: previously committed to – committed to in the first or second fiscal year prior to the subject year of the report; ongoing – committed to at least three fiscal years prior to the subject year of the report; and new – newly committed to in the reporting year of the RPP or DPR. If another type that is specific to the department is introduced, an explanation of its meaning must be provided.

Risk Analysis

The Board consists of not more than five part-time members, including a Chairperson and a Vice-Chairperson. The Chairperson is designated under the Act as the Chief Executive Officer of the PMPRB, with the authority and responsibility to supervise and direct its work.

The Members of the Board are responsible for the implementation of the applicable provisions of the Act. Together, they establish the guidelines, rules, by-laws and other policies of the Board provided by the Act and consult as necessary with stakeholders including the Minister of Health and representatives of consumer groups, the pharmaceutical industry and provincial and territorial governments and, when needed, conduct hearings.

Appointments to the Board are recommended to the Privy Council Office by the Minister of Health. In July 2014, a fifth Board Member was appointed with the result that the PMPRB now has its full complement of Board Members.

In recent years, the high price and utilization of new patented drug products, in particular biologics with new indications have raised questions about the need for subsequent additional price reviews for these products. Through its Guidelines Monitoring and Evaluation Plan and its work with F/P/T drug plan representatives and other stakeholders, the Board will explore these issues in greater depth.

In 2015, the PMPRB will implement a new CPI Adjustment Methodology^xiv that replaces the forecast CPI with actual CPI to calculate the CPI Adjustment Factor for the forecast period.

On May 27, 2014, the Federal Court issued its decisions on the applications for judicial review of two of the Board’s decisions stemming from hearings. In both cases, the Federal Court ruled that the company was not a “patentee” within the meaning of Section 79 of the Act and therefore did not fall under the jurisdiction of the Board. While court decisions pose a risk they also provide an opportunity for clarification to patentees and Board Staff with respect to key legislative and regulatory provisions and the application of the Board’s related Guidelines. The Attorney General filed Notices of Appeal in respect of these decisions on June 25, 2014.

As the federal expert body on questions related to drug prices, the PMPRB, via its Pharmaceutical Trends Program, contributes to informed decision-making by reporting on pharmaceutical trends. In addition, the PMPRB undertakes studies and conducts analysis on a variety of topics related to pharmaceutical pricing and costs. Through critical analyses of price, utilization and cost trends conducted under the NPDUIS initiative, the PMPRB provides Canada’s health system with comprehensive and accurate information on how prescription drugs are being used and on cost drivers. In 2013/14 the PMPRB has increasingly focused on strategies to improve the efficiency and relevance of its reporting mandate. Release of regular reports will be standardized and announced in advance in the NPDUIS Research Agenda. In order to ensure relevance of NPDUIS reporting, the PMPRB has embarked on a broader engagement strategy to identify research priorities and emerging areas of interest. The PMPRB has increased its outreach efforts with key stakeholders including academics, federal health portfolio partners, government policy and research communities, pharmaceutical and insurance industry as well as health professionals, patient advocacy and consumer groups. In 2013-14, the PMPRB released five new studies.

In accordance with the TB Directive on Performance Management, the PMPRB is committed to sustaining a culture of high performance. In March 2014, the PMPRB began establishing an employee performance management program including annual written performance assessments for all employees; mid-year reviews will begin in 2014-15. The PMPRB has also undertaken a review of its Employee Recognition Policy and will revise it as necessary to meet the new government requirements. In addition, the PMPRB is committed to establishing a Talent Management Plan documenting learning opportunities and assignments for the development of an employee’s potential career advancement and increased responsibility. The PMPRB has already introduced initiatives to enhance the development of its employees through internal assignments and cross-training programs to build the required skill set within the organization, as well as it has incorporated succession planning in its business planning activities.

Actual Expenditures

Alignment of Spending With the Whole-of-Government Framework

Departmental Spending Trend

Actual Spending for 2011–12 is significantly higher than spending for fiscal year 2012-13, because the Federal Court quashed a Board decision and ordered the PMPRB to refund $2,559.8 thousand paid to the Crown as a result of a Board Order.

In 2012–13, the PMPRB lapsed approximately $3 million in SPA funding, which is used, as needed, to conduct Public Hearings, as well as $776 thousand of its operating budget. These lapses include the $774 thousand of savings gained through operational efficiencies and streamlining processes. In 2012-13 total SPA funding was $3.1 million. In 2013-14, funding for the SPA was reduced to $2,470 thousand. The SPA can only be used to cover the costs of public hearings, such as external legal counsel, expert witnesses, etc. Any unspent amount is returned to the CRF.

In 2013-14, the Federal Court quashed a Board decision and the PMPRB was ordered to refund the patentee $ 2,801 thousand which was paid to the Crown as a result of a Board Order.

Planned Spending for subsequent years is based on the assumption that the entire SPA funding will be spent each fiscal year.

Estimates by Vote

For information on the Patented Medicine Prices Review Board’s organizational Votes and statutory expenditures, consult the Public Accounts of Canada 2014 on the Public Works and Government Services Canada website.^xvi

Section II: Analysis of Program(s) by Strategic Outcome

Strategic Outcome:

Canadians are protected from excessive prices for patented medicines sold in Canada and stakeholders are informed on pharmaceutical trends.

The PMPRB's Annual Report provides detailed statistics comparing the foreign prices of patented medicines to their Canadian prices. For many years, the PMPRB has reported average foreign-to-Canadian price ratios with foreign prices converted to their Canadian dollar equivalents by means of market exchange rates. (Specifically, the 36-month moving averages of market rates the PMPRB normally used in applying its Guidelines.) Focusing on the results with currency conversion at market exchange rates, Canadian prices, on average remain below median international prices (i.e., a ratio of 1.06 to 1). At the same time, with the exception of the U.S.-to-Canada ratios all bilateral average price ratios have fallen substantially in recent years. To put this trend in historical perspective, in 2005, Canadian prices were, on average, approximately equal to or below corresponding prices in all comparators other than Italy. By 2013, Canadian prices were decidedly above prices in the UK, France and Italy, and somewhat higher than prices in Sweden and Switzerland. As in previous years, prices reported for the United States were much higher than prices in Canada or any other comparator country.

Program 1.1: Patented Medicine Price Regulation Program

Description

The PMPRB is an independent quasi-judicial body that is responsible for ensuring that the prices that patentees charge for patented medicines sold in Canada are not excessive based on the price review factors in the Act. To make this determination the Board must consider each of the following factors: prices at which the medicine and other medicines in the same therapeutic class have been sold in Canada and in the seven comparator countries listed in the Regulations; changes in the Consumer Price Index (CPI); and in accordance with the Act, such other factors as may be specified in any regulations made for the purposes of the price review. Under the Act, and as per the Regulations, patentees are required to file price and sales information for each patented medicine sold in Canada, for the duration of the patent(s). Board Staff reviews the introductory and ongoing information filed by patentees, for all patented medicines sold in Canada. When it finds that the price of a patented medicine appears to be excessive, Board Staff will conduct an investigation into the price. An investigation could result in: its closure where it is concluded that the price was non-excessive; a Voluntary Compliance Undertaking (VCU) by the patentee to reduce the price and offset excess revenues obtained as a result of excessive prices through a payment and/or a price reduction of another patented drug product; or a public hearing to determine if the price is excessive, including any remedial order determined by the Board. In the event that the Board Hearing Panel finds, after a public hearing, that a price is or was excessive, it may order the patentee to reduce the price and take measures to offset any excess revenues. This program, by reviewing the prices charged by patentees for patented medicines sold in Canada, protects Canadians and the health care system from excessive prices.

Performance Analysis and Lessons Learned

Patentees are to ensure that the prices of their patented drug products are within the Board’s Guidelines during all periods in which the drug products are under the PMPRB's jurisdiction.

Under the Guidelines, patentees are given an opportunity to submit a VCU when Board Staff concludes, following an investigation, that the price for a patented drug product sold in Canada appears to have exceeded the Guidelines. A VCU can also be submitted by a patentee after a Notice of Hearing is issued. A VCU is a written undertaking by a patentee to adjust its price to conform to the Board’s Guidelines.

In 2013, Board Staff completed price reviews of 1,341 of the 1,343 new and existing patented medicines sold in Canada for human use reported to the PMPRB. As at March 31, 2014, two patented medicines were still under review. Of the total patented medicines reported to the PMPRB, 1,098 were priced within the Guidelines and 164 were priced at a price which did not trigger the investigation criteria – 94.0% of the patented medicines were voluntarily priced within the Guidelines or at a price which did not trigger the investigation criteria. This is slightly higher than the 92.5% reported last year in the DPR.

Since the implementation of the new Guidelines in January 2010, the percentage of patented medicines voluntarily priced within in the Guidelines or at a price which does not trigger the investigation criteria has been over 90%: 91.1% in 2010; 94.6% in 2011; 92.5% in 2012; and, 94.0% in 2013.

In its 2012 Annual Report, the PMPRB began reporting the number of VCUs accepted by the Chairperson in the Status of Price Reviews table.

When the number of VCUs is included as part of the calculation of the percentage of all patented medicines reported to the PMPRB that are voluntarily priced within the Guidelines or at a price which does not trigger the investigation criteria the percentage of voluntary compliance moves from 92.5% to 94.9% in 2012, and from 94.0% to 94.9% for 2013

Program 1.2: Pharmaceutical Trends Program

Description

The PMPRB reports annually to Parliament through the Minister of Health on its price review activities, the prices of patented medicines and price trends for all drugs, and R&D expenditures as reported by pharmaceutical patentees. In supporting this requirement, the Pharmaceutical Trends Program provides complete and accurate information on trends in manufacturers’ prices of patented medicines sold in Canada and on patentees’ research-and-development expenditures to interested stakeholders including: industry (i.e., brand-name, biotech, generic); F/P/T governments; consumer and patient advocacy groups; third party payers; and others. This information also provides assurance to Canadians that the prices of patented medicines are not excessive. In addition, as a result of the establishment of the NPDUIS by F/P/T ministers of health, the Minister of Health requested that the PMPRB conduct analysis of price, utilization and cost trends for prescription drugs so that Canada’s health system has comprehensive, accurate information on how prescriptions drugs are being used and on the sources of cost increases. The PMPRB publishes specific NPDUIS reports based on the research and reporting priorities identified by the NPDUIS Steering Committee.

Performance Analysis and Lessons Learned

Patentees are required under the Regulations to submit detailed information on their sales of patented drug products, including quantities sold and net revenues received for each product by class of customer in each province/territory. The PMPRB uses this information to analyze trends in sales, prices and utilization of patented drug products. (Additional information on key statistical results from this analysis can be found in the PMPRB’s 2013 Annual Report which is posted on its website.)

In addition, the Act mandates the PMPRB to monitor and report on pharmaceutical research and development (R&D) spending, while giving the PMPRB no regulatory authority to consider the amount or type of patentees’ research spending in the context of its pricing regulations. (Additional information relating to key statistics on the current state of pharmaceutical research investment in Canada can be found in the PMPRB’s 2013 Annual Report which is posted on its website.)

In 2013-14, the PMPRB did not achieve its target of a 5% increase in the number website hits. However, it has seen a steady increase (59% from April 2013 to March 2014) in the number of followers to its Twitter.

All PMPRB publications, including studies, Board decisions and reference documents, are available on the PMPRB website.

In 2013-14, the PMPRB organized numerous meetings with stakeholders in order to consult on its research projects and promote the results of its studies, including the Canadian Generic Pharmaceutical Association, the Canadian Pharmacist Association, the Canadian Agency for Drugs and Technologies in Health (CADTH), the Canadian Diabetes Association and the Canadian Life and Health Insurance Association. In addition, the PMPRB participated in 26 external events and presented on various topics at 8 of these events. The events addressed a variety of audiences, including the PMPRB’s main stakeholders: patentees, provinces, third-party payers and patient advocacy groups.

The PMPRB continues to use new mediums, such as videoconference and webinar, to reach a greater number of stakeholders. In April 2013, the PMPRB hosted 6 webinars for the dissemination of the results of its NPDUIS study, The Use of Blood Glucose Test Strips in Select Public Drug Plans, 2008.

The National Prescription Drug Utilization Information System (NPDUIS) is a research initiative established by F/P/T Ministers of Health in September 2001. Its purpose is to provide policy makers and public drug plan managers with critical analyses of price, utilization and cost trends, so that Canada’s health care system has more comprehensive and accurate information on how prescription drugs are being used and on sources of cost increases.

The NPDUIS Advisory Committee, composed of representatives from public drug plans in British Columbia, Alberta, Saskatchewan, Manitoba, Ontario, New Brunswick, Nova Scotia, Prince Edward Island, Newfoundland and Labrador, Yukon, and Health Canada, advises the PMPRB on its research agenda and on individual studies. The Committee also includes observers from Canadian Institute for Health Information (CIHI) and Canadian Agency for Drugs and Technologies in Health (CADTH).

The PMPRB published five NPDUIS reports in 2013-14:

• New Drug Pipeline Monitor – 5^th Edition (December 2013)
• The Drivers of Prescription Drug Expenditures – A Methodological Report (December 2013)
• Analytical Snapshot: International Generic Price Comparison, Early 2011 (August 2013)
• The Use of Blood Glucose Test Strips in Select Public Drug Plans, 2008 (April 2013)
• New Drug Pipeline Monitor – 4^th Edition (April 2013)

Other NPDUIS studies are currently under development and are summarized in the NPDUIS Research Agenda^xvii.

Internal Services

Description

Internal Services are groups of related activities and resources that are administered to support the needs of programs and other corporate obligations of an organization. These groups are: Management and Oversight Services; Communications Services; Legal Services; Human Resources Management Services; Financial Management Services; Information Management Services; Information Technology Services; Real Property Services; Materiel Services; Acquisition Services; and Other Administrative Services. Internal Services include only those activities and resources that apply across an organization and not to those provided specifically to a program.

Performance Analysis and Lessons Learned

In 2013-14, the PMPRB published its Code of Conduct which is a statement of the fundamental principles and related standards of conduct applicable to all its employees. By committing to these values and adhering to the expected behaviours, the PMPRB strengthens the ethical culture of the public sector, and contributes to public confidence in the integrity of all public institutions.

In addition, the PMPRB revised and received Ministerial approval of its Delegation of Financial Signing Authorities instrument. The primary purpose of this instrument is to document the PMPRB’s delegated financial and procurement authorities and to satisfy the Minister’s legal requirement that the delegations be formally made in writing. The PMPRB also made significant progress on its electronic document and records management system (named Records and Information Management System – RIMS). In support of this initiative it also offered all employees training sessions on “Duty to Delete” and the “Care and Custody” of information holdings. Furthermore, all employees of the PMPRB are required to take the on-line course Recordkeeping for Public Servants offered by the Canada School of the Public Service.

Section III: Supplementary Information

Financial Statements Highlights

Total Liabilities

Total liabilities were $1,112,115 as at the end of 2013-14, a decrease of $116,523 from the previous year. The decrease in liabilities was as follows:

• Accounts payable and accrued liabilities increased by $32, 444.
• Vacation pay and compensatory leave decreased by $7,340.
• Employee future benefits decreased by $141,627.

Total Assets

Total assets were $644,947 at the end of 2013-14, an increase of $53,106 from the previous year. The variances in assets were as follows:

• Increase in Due from the Consolidated Revenue Fund of $29,214.
• Increase in Accounts receivable and advances of $16,499.
• Increase in Tangible capital assets of $7,393.

Financial Statements

The financial highlights presented within this Departmental Performance Report are intended to serve as a general overview of the PMPRB’s financial position and operations. The PMPRB’s Financial Statements^xviii can be found on its website.

Supplementary Information Tables

The supplementary information tables^xix listed in the 2013–14 Departmental Performance Report can be found on the Patented Medicine Price’s Review Board’s website.

• Departmental Sustainable Development Strategy;
• Internal Audits and Evaluations;
• Sources of Respendable and Non-Respendable Revenue (optional);

Tax Expenditures and Evaluations

The tax system can be used to achieve public policy objectives through the application of special measures such as low tax rates, exemptions, deductions, deferrals and credits. The Department of Finance Canada publishes cost estimates and projections for these measures annually in the Tax Expenditures and Evaluations^xx publication. The tax measures presented in the Tax Expenditures and Evaluations publication are the sole responsibility of the Minister of Finance.

Section IV: Organizational Contact Information

The Patented Medicine Prices Review Board
Box L40
Standard Life Centre
333 Laurier Avenue West
Suite 1400
Ottawa, Ontario K1P 1C1
Telephone: (613) 952-7360
Toll-free no.: 1-877-861-2350
Facsimile: (613) 952-7626
TTY: (613) 957-4373

Email: pmprb@pmprb-cepmb.gc.ca

Website: www.pmprb-cepmb.gc.ca

Appendix: Definitions

appropriation: Any authority of Parliament to pay money out of the Consolidated Revenue Fund.

budgetary expenditures: Include operating and capital expenditures; transfer payments to other levels of government, organizations or individuals; and payments to Crown corporations.

Departmental Performance Report: Reports on an appropriated organization’s actual accomplishments against the plans, priorities and expected results set out in the corresponding Reports on Plans and Priorities. These reports are tabled in Parliament in the fall.

full-time equivalent: Is a measure of the extent to which an employee represents a full person-year charge against a departmental budget. Full-time equivalents are calculated as a ratio of assigned hours of work to scheduled hours of work. Scheduled hours of work are set out in collective agreements.

Government of Canada outcomes: A set of 16 high-level objectives defined for the government as a whole, grouped in four spending areas: economic affairs, social affairs, international affairs and government affairs.

Management, Resources and Results Structure: A comprehensive framework that consists of an organization’s inventory of programs, resources, results, performance indicators and governance information. Programs and results are depicted in their hierarchical relationship to each other and to the Strategic Outcome(s) to which they contribute. The Management, Resources and Results Structure is developed from the Program Alignment Architecture.

non-budgetary expenditures: Include net outlays and receipts related to loans, investments and advances, which change the composition of the financial assets of the Government of Canada.

performance: What an organization did with its resources to achieve its results, how well those results compare to what the organization intended to achieve and how well lessons learned have been identified.

performance indicator: A qualitative or quantitative means of measuring an output or outcome, with the intention of gauging the performance of an organization, program, policy or initiative respecting expected results.

performance reporting: The process of communicating evidence-based performance information. Performance reporting supports decision making, accountability and transparency.

planned spending: For Reports on Plans and Priorities (RPPs) and Departmental Performance Reports (DPRs), planned spending refers to those amounts that receive Treasury Board approval by February 1. Therefore, planned spending may include amounts incremental to planned expenditures presented in the Main Estimates.

A department is expected to be aware of the authorities that it has sought and received. The determination of planned spending is a departmental responsibility, and departments must be able to defend the expenditure and accrual numbers presented in their RPPs and DPRs.

plans: The articulation of strategic choices, which provides information on how an organization intends to achieve its priorities and associated results. Generally a plan will explain the logic behind the strategies chosen and tend to focus on actions that lead up to the expected result.

priorities: Plans or projects that an organization has chosen to focus and report on during the planning period. Priorities represent the things that are most important or what must be done first to support the achievement of the desired Strategic Outcome(s).

program: A group of related resource inputs and activities that are managed to meet specific needs and to achieve intended results and that are treated as a budgetary unit.

results: An external consequence attributed, in part, to an organization, policy, program or initiative. Results are not within the control of a single organization, policy, program or initiative; instead they are within the area of the organization’s influence.

Program Alignment Architecture: A structured inventory of an organization’s programs depicting the hierarchical relationship between programs and the Strategic Outcome(s) to which they contribute.

Report on Plans and Priorities: Provides information on the plans and expected performance of appropriated organizations over a three-year period. These reports are tabled in Parliament each spring.

Strategic Outcome: A long-term and enduring benefit to Canadians that is linked to the organization’s mandate, vision and core functions.

sunset program: A time-limited program that does not have an ongoing funding and policy authority. When the program is set to expire, a decision must be made whether to continue the program. In the case of a renewal, the decision specifies the scope, funding level and duration.

target: A measurable performance or success level that an organization, program or initiative plans to achieve within a specified time period. Targets can be either quantitative or qualitative.

whole-of-government framework: Maps the financial contributions of federal organizations receiving appropriations by aligning their Programs to a set of 16 government-wide, high-level outcome areas, grouped under four spending areas.

Endnotes

i. Additional information on the amendments to the Patented Medicines Regulations can be found on the PMPRB website: http://www.pmprb-cepmb.gc.ca/view.asp?ccid=786

ii. Patent Act: http://laws-lois.justice.gc.ca/eng/acts/P-4/index.html

iii. Patented Medicines Regulations: http://laws.justice.gc.ca/en/P-4/SOR-94-688/index.html

iv. Additional information on the National Prescription Drug Utilization Information System can be found on the PMPRB website: http://www.pmprb-cepmb.gc.ca/en/npduis/about-npduis

v. Service standard for the scientific review of new patented drug products: http://www.pmprb-cepmb.gc.ca/view.asp?ccid=499

vi. Service standard for the price review of new patented drug products: http://www.pmprb-cepmb.gc.ca/view.asp?ccid=500

vii. Service standard for the price review of existing patented drug products: http://www.pmprb-cepmb.gc.ca/view.asp?ccid=501

viii. New Drug Pipeline Monitor, April 2013: http://www.pmprb-cepmb.gc.ca/view.asp?ccid=942

ix. The Use of Glucose Test Strips in Select Public Drug Plans, 2008, April 2013: http://www.pmprb-cepmb.gc.ca/view.asp?ccid=941

x. Analytical Snapshot: International Generic Price Comparison, Early 2011, August 2013: http://www.pmprb-cepmb.gc.ca/view.asp?ccid=487

xi. The Drivers of Prescription Drug Expenditure – A Methodological Report, December 2013: http://www.pmprb-cepmb.gc.ca/view.asp?ccid=887

xii. New Drug Pipeline Monitor, December 2013: http://www.pmprb-cepmb.gc.ca/view.asp?ccid=483

xiii. Monitoring and Evaluation Plan for Major Changes to the Guidelines, 2013: http://www.pmprb-cepmb.gc.ca/view.asp?ccid=493

xiv. Additional information on the CPI Adjustment Methodology consultations and changes can be found on the PMPRB website: http://www.pmprb-cepmb.gc.ca/view.asp?ccid=783

xv. Whole-of-government framework, http://www.tbs-sct.gc.ca/ppg-cpr/frame-cadre-eng.aspx

xvi. Public Accounts of Canada 2014, http://www.tpsgc-pwgsc.gc.ca/recgen/cpc-pac/index-eng.html

xvii. The NPDUIS Research Agenda can be found on the PMPRB website: http://www.pmprb-cepmb.gc.ca/en/npduis/research-agenda

xviii. The Financial Statements can be found on the PMPRB’s website: http://www.pmprb-cepmb.gc.ca/view.asp?ccid=1111

xix. The supplementary information tables listed in the 2013–14 Departmental Performance Report can be found on the Patented Medicine Price’s Review Board’s website: http://www.pmprb-cepmb.gc.ca/view.asp?ccid=890

xx. Tax Expenditures and Evaluations publication, http://www.fin.gc.ca/purl/taxexp-eng.asp