Pharmaceutical Utilization and costs in Canada Flashcards
Drug costs in canada
- Important issue in canada
- Many health care costs are staying the same or declining while drug costs are going up
- Hospitals are 25.1%, drugs 13.9%, physicians 13.5% of spending
How is drug cost determined
- Price x quanitiy
- Drug type
What is drug utilization
- Refers to bot the amount and types of medicines that are prescribed and consumed
- A number of factors affect the prescription and non prescription drugs which are selected by prescribers and patients which are: medical social or economic
What are different drug types referring to
- Drug class
- Drug type
- Brand vs generic version
What is utilization affect by
- Demographic changes
- Disease patterns
- Availability of drug therapy
- Perceived cost (access to funding)
- Prescribing patterns
- Patient expectations
Demographic changes
- Increase or decrease in population
- Can also be age distribution shift as older people tend to use more drugs and we are beginning to get more of a shift to this demographic
- However there is an increase in the number of those over 65 the health care spending for this demographic has remained relatively the same
Disease patterns
- Changes in the rates of diseases that require drug therapy
- Can also be due to the aging population and diseases that are associated with aging but also societal and cultural changes (less bad habits)
Availability of drug therapy
- Drugs can be the easy way out and replace other types of intervention
- Drugs are often picked as the other type of intervention may be more invasive, prolonged, less convenient
Perceived cost (access to funding)
- Those with higher incomes (or insurance) are more likely to want and use medications, access new and more expensive drugs even if it is not better
Prescribing patterns
- People tend to persist with, or rely on a drug or treatment
- Supported by status quo bias (do what were comfortable with)
a) Status quo bias is due to - Stability preference (like things the same)
- Selection difficulty (don’t know what to select and if they pick something that has adverse effects its their fault)
- Cost of change (the prescriber has to learn and use a time to get more knowledge)
- Anticipated regret
b) Tend to replace older drugs (cheaper) with newer drugs (expensive)
c) There is not ideal choices among prescribers due to - Not enough training and knowledge of pharmaceutics
- Reliance of promotional information
- Follow the practices of influential colleagues
- Supported by status quo bias (do what were comfortable with)
Patient expectations
- We perceive risks much more then the benefits usually
- There is direct to consumer advertising (a practice which is used by pharmaceutical manufactures that goes through HCP to promote their drug products to the patients directly)
- Patients expect to be prescribed something for their issues
What is the role of the federal government (three federal jurisdictions)
- Specific policy areas that affect the pharmaceutical sector
- Three federal jurisdictions that affect the availability of pharmaceutics are
a) Food and drug act: - Ensures efficacy and safety
- The drug approval process
- Drug promotion
b) Patent act: - Encourages and rewards innovation
c) Patent medicine price review board: - Seeks value and prevents exploitation but still allow the drug company to make money
- Three federal jurisdictions that affect the availability of pharmaceutics are
The food and drugs act
1.
a) Files a new drug submission
- This all includes results of trials
- All of the details of production, packaging and labelling
- Therapeutic value
- Indications and adverse effects
b) Drugs which are approved get a NOC and a DIN
- NOC: notice of compliance allows you to sell a drug in canada
- Drug identification number allows you to bill insurance for it which can lower the perceived cost
2. Regulating drug promotion
- Section 9.1 of food and drug act: advertising cant include info that is false, misleading or deceptive
- Authority and responsibility for regulating drug promotion is within health canada through the food and drugs act: the authority for monitoring is mostly with the pharmaceutical industry
- HC reviews all complaints about DTCA
3. The patent act
- Patent are critical
- Changed over time but now there is drug patents and trade agreements
- Bill C-22 conformed patent laws extended protection to 20 years and eliminated compulsory licensing
- R&D investment: increased but then lowered
Drug patents and trade agreements
- CETA
- Canada- european trade agreement
- Patent extension up to 2 years if it was not given early enough
- Supplementary protection
2. CPTPP - Comprehensive and prgressive agreement for trans pacific partnership
- No patent extensions
3. Canada united states mexico - Nafta 2.0
- No patent extensions
Patent medicine price review board
- 1987 started
- Monitors the prices of patent medicines
- Non patented or ones drugs patent ran out are not regulated and they are influenced by competition, hospital P and T committees, and formularies
a) PMPRB pricing criteria - First of a class (breakthrough)
- The intro price will be a median price of many other companies that are around the same economic and size of canada
- Also based on how much improvement the drug gives
- It dropped USA and switzerland from the median price as they both have very large drug development companies which sell to other countries and allows them to sell at a high price
