WHY DOCTORS CARE ABOUT PHARMACARE. Alissa Von Bargen Canadian Doctors for Medicare October 29, 2013

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1 WHY DOCTORS CARE ABOUT PHARMACARE Alissa Von Bargen Canadian Doctors for Medicare October 29, 2013

2 Why physicians care Patients can t afford medications Results in complications and worsening conditions Docs resort to patchwork solutions Patients wind up back in doctors offices or in emergency departments

3 Affordability out of reach In Canada, 1 out of 10 people can t afford their prescriptions, and that s 1 in 4 if you re uninsured. There is a growing segment of our population without insurance 1/5 Canadians don t have supplementary health insurance and one in three Canadians or their family members have gone without care Evidence shows that providing medically necessary medications at no cost to the patient improves outcomes. Law, M. et al The effect of cost on adherence to prescription medications in Canada. CMAJ 184(3): Statistics Canada. Workplace and Employee Survey: Compendium June Ottawa: Statistics Canada. Canadian Medical Association. Gaps in medicare affect one-third of Canadians, poll shows. Choudry, NK, Javorn et al Full Coverage for Preventive Medications after Myocardial Infarction. New England Journal of Medicine 365(22):

4 Utilization In 2009 Canadian physicians wrote 80% more prescriptions than they did only a decade earlier 1 New drugs are often introduced at higher prices than older versions of very similar drugs 2 Two-thirds of Canadians 65+ are taking five or more medications 2 Biggest increases in drugs for cardiovascular, cholesterol reduction and depression 2 1 Decisions, Decisions: Family Doctors as Gatekeepers to Prescription Drugs and Diagnostic Imaging in Canada. Health Council of Canada, Research Synthesis on Cost Drivers in the Health Sector and Proposed Policy Options. Canadian Health Sciences Research Foundation, 2011.

5 Higher costs for Canada Canada has the lowest rates of public drug coverage in the OECD Not only do Canadians pay out of pocket for prescription drugs, but Canada allows unusually high prices for drugs. We re paying 30% more for prescriptions than the OECD average. Canada pays 62.5 cents compared to the United States 6.9 cents for simvastatin, a drug used to lower cholesterol. Canada spent $26.1 billion in $4.6 billion out-of-pocket costs Canada s annual growth in spending on drugs over the past decade was 7% - more than double OECD average Gagnon, Marc-Andre The Economic Case for Universal Pharmacare. Canadian Centre for Policy Alternatives (Ottawa) and the Institut de recherche et d information (Montreal). Law M. Money Left on the Table: Generic Drug Prices in Canada. Healthcare Policy. 2013;8(3):25.

6 Why do we pay so much? Not a free market - patents in pharma Legal and reg framework that results in some people being covered and some not covered Multi-payer system Less efficient Drug assessment and pricing policies Our specific framework results in higher prices

7 Private drug insurance Limited incentives to curb costs - private plans pay $383 million more a year for generics than public plans. Insurance market not perfectly competitive Our private insurance market less regulated than US system under Obamacare Private insurance companies also receive tax subsidies relative to their expenditures - about 10% or $933 million per year. Private administration of insurance has higher administrative costs - 8% relative to the public system's 2%. Mix of public and private plans dilutes economies of scale - can t bulk purchase as effectively. Pricing policies for patented drugs are based on an average of 7 industrial countries, 4 of which pay the highest prices. Gagnon, M-A. The Economic Case for Universal Pharmacare: Costs and Benefits of Publicly Funded Drug Coverage for All Canadians.

8 Drug assessment and pricing policies Public formularies tend to use robust processes not all private insurers do. Incentives are currently focused on creating imitations of existing drugs that sell well, not innovation 85-90% of new products provide few new benefits Promotion is up to 80% of increase in drug costs. Fewer and fewer breakthrough drugs, higher and higher prices Insulin breakthrough drug expensive to produce in 1920s But in last decade, there are new insulins that are marginally better, but much more expensive. Gagnon, M-A. The Economic Case for Universal Pharmacare: Costs and Benefits of Publicly Funded Drug Coverage for All Canadians. Light, Donald and Lexchin, Joel Pharmaceutical research and development: what do we get for all that money? BMJ 2012;345:e4348.

9 Elements of a model 1) Universal coverage 2) Accessible first-dollar or very low co-pays 3) Efficient Single payer more efficient than mulit-payer Evidence-based bulk-buying Reduce subsidies for private insurance companies

10 Covered by Canada Health Act? Universal Accessible Comprehensive Portable Publicly Administered

11 It s time for national Pharmacare Canada is the only developed country with a universal health care system that doesn t include Pharmacare. We would be healthier, have lower long-term system costs, and reduce drug prices if provinces and territories worked together to create a national Pharmacare program.

12 THANK YOU!

Response to the New Brunswick Government Consultation on a Prescription Drug Plan for Uninsured New Brunswickers

Response to the New Brunswick Government Consultation on a Prescription Drug Plan for Uninsured New Brunswickers Brief submitted by The New Brunswick Nurses Union April 2012 Background The New Brunswick