Meeting minutes - Technical Working Group October 12, 2018

8:30:00 a.m. to 4:15 p.m. EDT
Alt Hotel, Ottawa, ON

Participants: Dr Chris Cameron (Dalhousie University and Cornerstone Research Group), Dr Tammy Clifford (University of Ottawa and CADTH), Dr Doug Coyle (University of Ottawa), Marie-Claude Aubin (INESSS), Don Husereau (Institute of Health Economics), Dr Peter Jamieson (University of Calgary), Dr Frédérick Lavoie (Pfizer Canada), Dr Karen Lee (University of Ottawa and CADTH), Dr Christopher McCabe (University of Alberta and Institute of Health Economics), Dr Stuart Peacock (Simon Fraser University and BC Cancer Agency), Maureen Smith (Patient), Geoff Sprang (Amgen), Dr Tania Stafinski (University of Alberta)

Observers: Edward Burrows (Innovation, Science and Economic Development), Nicole Tuczynski (Health Canada)

PMPRB: Dr.Mitchell Levine, Doug Clark, Tanya Potashnik, Matthew Kellison, Isabel Jaen Raasch, Guillaume Couillard, Thy Dinh, Elena Lungu, Theresa Morrison, Barbara Jazewski

The PMPRB Working Group to Inform the Patented Medicine Prices Review Board (PMPRB) Steering Committee on Modernization of Price Review Process Guidelines (WG) met in Ottawa on October 12, 2018.

Following the WG meeting of September 25, 2018, the deadline to prepare the final draft WG report was extended to early 2019. As a result, members continued to discuss the questions in the Terms of Reference and possible recommendations. Summaries of these discussions are below.

Accounting for Uncertainty

The morning session began with a presentation by Dr. McCabe regarding accounting for uncertainty when using supply side cost effectiveness thresholds for setting a ceiling price. Members discussed the various sources of uncertainty and potential analytical methods to address it.

Consumer and Producer Surplus

Dr. Paulden gave a presentation entitled “Strategic Behaviour and the Cost-Effectiveness Threshold” based on his paper appended to the Institute of Health Economics March 2018 report “Theoretical models of the cost-effectiveness threshold, value assessment, and health care system sustainability”.

Next Steps for the Working Group

Members representing the pharmaceutical industry expressed concern with the challenges of implementing the economic factors in the proposed regulatory framework in a clear and transparent way. Members agreed that there is no simple model available to import and that a Canadian model that reflects the unique challenges of the Canadian healthcare system is necessary.

Members discussed that the starting point for such a model could be “K”, the point where consumer surplus is zero (a supply-side model threshold). A single value for K could be used, taking into consideration all payers, but any single choice of K would be based on different policy considerations.

Members agreed that supply-side cost effectiveness thresholds for Category 1 medicines would differ across provinces and payers and that empirical evidence is needed to determine any specific threshold. Members discussed the possibility of higher thresholds for some medicines according to what Canadians and/or payers value. It was mentioned that medicines for rare diseases often lack sufficient evidence to create a robust model and calculate a reliable ICER. It was also mentioned that new medicines could be introduced for rare diseases where treatment options already exist and there is not an unmet need.

Members discussed the implications of choosing a cost effective threshold. For example, if the highest threshold of all provinces were chosen, all but highest priced province would get negative consumer surplus. Alternatively, if the cost effective price from the lowest priced province was used, some provinces might not have access to the medicine. Additionally, it was discussed that when a medicine has multiple indications, none should have a price that results in negative health. In general, it was discussed that the approach used should be determined by the policy objectives of the federal government.

PMPRB representatives confirmed that the policy intent, as communicated in the Regulatory Impact Analysis Statement and the WG Terms of Reference, is to adopt the healthcare system perspective. The member representing patient groups voiced that in order to engage patients in a meaningful way, consultation materials should be drafted in lay language that explains the consumer protection mandate of the PMPRB from the perspective of sustainability of the public health care system.

Members discussed the necessity of having a point estimate instead of a range for the ICER, and where in the range the point estimate should fall. Members representing the pharmaceutical industry voiced concerns that a range of possible reference cases introduces uncertainty. Additionally, who should bear the burden of uncertainty (i.e., payer or manufacturer) was discussed.

It was discussed that a market size evalulation could be used to indentify cost-effective medicines that may have a large budget impact. The market size adjustment would be applied after the pharmacoeconomic evalulation and what is considered a large market size would be set in reference to a GDP threshold. It was noted that GDP is to some extent reflected in K. Another teleconference is needed for further discussion around market size and GDP.

Given that the deadline for the Working Group to produce final recommendations was extended, members raised the question of looking at that “real life” examples and case studies to further inform the discussion on the issues and possible recommendations. Development of case studies will require scoping out feasibility and clarifying objectives.

The next teleconference will be scheduled in November, 2018.