OutcomesBased Drug Coverage in British Columbia, Canada

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Outcomes-BasedDrug Coverage in British
Columbia, Canada

• Ciprian Jauca

ISDB General Assembly December 2008 Matagalpa,
Nicaragua
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Background

• Since 1994 the Therapeutics Initiative (TI) at
  the University of British Columbia has provided
  provincial decision makers with a system of
  evidentiary review and support.
• Coverage policies under B.C. PharmaCare are
  marked by the restriction of public subsidy until
  manufacturers provide valid evidence of a
  comparative health outcome advantage versus
  therapeutic alternatives.
• Implementing and maintaining such outcomes-based
  coverage policies has required a system of
  evidentiary review and support which the TI was
  able to provide.

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Policy Origins

• Outcomes-based coverage was introduced in BC in
  mid 1990s, when rapid cost growth threatened the
  tax-financed provincial drug benefit program,
  PharmaCare.
• PharmaCare costs were growing at a rate of 17
  per year, compared with only 7 growth per year
  in provincial GDP.
• Other jurisdictions felt similar cost pressures
  most responded with new co-payments and
  deductibles.
• PharmaCare instead began to pursue outcomes-based
  coverage policies.

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Role of the TI

• The TI is a university-based group of family
  physicians, specialists, academic researchers,
  clinical pharmacologists, pharmacists and
  epidemiologists.
• The mandate of the TI includes the evaluation of
  all drugs for which manufacturers seek public
  coverage.
• Other activities of the TI include the
  publication of the Therapeutics Letter and its
  dissemination to all prescribing physicians and
  pharmacists, as well as continuing education for
  physicians and pharmacists.
• The TI is also routinely called upon to offer
  decision-makers advice about clinical evidence
  related to often hotly contested coverage
  decisions.

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Reference Drug Program

• In 1995 PharmaCare subjected nitrates,
  H2-blockers, and NSAIDs to reference-based
  subsidy.
• ACE inhibitors and CCBs were added to the
  Reference Drug Program in 1997.
• For each drug class, the TI had already conducted
  a systematic review of the available evidence and
  had published this in the Therapeutics Letter.
  This included an analysis trying to answer the
  question whether scientifically-valid evidence
  indicated the superiority of any drug in terms of
  morbidity or mortality, and a cost comparison.

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Reference Drug Program

• Since the evidence for each of these drug classes
  indicated that no drug was superior, while there
  were considerable differences in cost, PharmaCare
  based its public subsidy on low-cost options
  within the class.
• Patients with clinical requirements for specific
  products received full subsidy through a special
  authority process.
• Any patient could top-up reference-based
  subsidy to the cost of his/her preferred drug.

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Reference Drug Program

• The application of the Reference Drug Program
  assigned the burden of proof to the
  manufacturers if a company wanted to have their
  drug subsidized at a higher rate than therapeutic
  alternatives were required to provide proof that
  their product had a scientifically established
  health outcome advantage.
• Opposition to RDP included legal challenges,
  negative media campaigns, and threats to cease
  drug industry funding of research in BC.

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Reference Drug Program

• Knowing that rigorous external assessment was
  appropriate to policy based on scientific
  evidence, PharmaCare provided data access to
  academic groups that sought to evaluate the
  program.
• Teams from Harvard, U of Washington and McMaster
  University evaluated the policy and found that it
  was successful at containing costs, ensuring
  on-going access and avoiding deleterious health
  and health system consequences.
• PharmaCare savings as a direct consequence of
  this program are conservatively estimated at 12
  million annually.

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COX-2 Inhibitors

• This is a case where BC decision-makers have
  learned that outcomes-based coverage can also be
  used to manage market entry.
• This is especially true in cases of intensely
  marketed new products for which there is little
  or no evidence upon which to base coverage
  decisions.

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COX-2 Inhibitors

• COX-2 inhibitors were first marketed in 1999 for
  the treatment of osteoarthritis and rheumatoid
  arthritis.
• COX-2 cost much more than older NSAIDs.
• The premium price was rationalized by claims of
  reduced adverse consequences from
  gastro-intestinal toxicity.
• Most drug plans in Canada and elsewhere provided
  coverage for COX-2s shortly after their launch.
• BC, however did not.

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COX-2 Inhibitors

• In 1999, at the time celecoxib (Celebrex) was
  launched, the TI undertook a review of the
  evidence for this new drug, which even before its
  introduction on the market was presented as a
  blockbuster. A Therapeutics Letter was produced
  and disseminated on this topic.
• There were yet no published RCTs of celecoxib,
  and reports of trials submitted to Health Canada
  for market approval were not made public.

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• Therapeutics Letter 31August-September 1999

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COX-2 Inhibitors

• This was the first time in TIs experience that a
  drug was licensed in Canada without any publicly
  available evidence.
• In the absence of evidence, TI concluded that
  celecoxibs relative efficacy and safety were
  unknown and warned physicians not to prescribe
  it.
• PharmaCare consequently restricted funding of
  COX-2 inhibitors until the manufacturer published
  valid evidence that COX-2s were indeed superior
  to older NSAIDs.

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COX-2 Inhibitors

• Maintenance of this policy, like other
  outcomes-based policies, required evaluation and
  re-evaluation of evidence submitted by
  manufacturers seeking coverage.
• The TI performed half a dozen reviews of COX-2s
  between 1999 and 2003.
• None would find valid evidence of a health
  outcome advantage, while evidence of potential
  serious harms started to emerge.

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COX-2 Inhibitors

• PharmaCares restrictions on COX-2 inhibitors has
  produced major savings to the public drug plan
  Ontario spent approx 50/senior on COX-2s and
  other NSAIDs in 2002, BC spent less than 7.
• This difference amounts to 23 million in annual
  savings for the people of BC.
• The use of COX-2s was considerably lower in BC,
  5.2 DDD/capita, compared to 12.9 DDD/capita in
  the rest of the country.
• To manufacturers, BCs lower COX-2 use represents
  a loss of approximately 40 million in annual
  sales.

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Lessons Learned

• An independent, academic group such as the TI,
  when working in tandem with decision-makers, made
  possible this unique approach of paying for
  proven health outcomes.
• The TI not only produced the systematic reviews
  of the evidence, but also disseminated them
  widely through the Therapeutics Letter, in a
  timely manner, while at the same time providing
  on-going advice to decision-makers.
• Although physicians, pharmacists and patients
  were heavily lobbied by the manufacturers, the
  policies were accepted because they were based on
  independent, valid science.

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Lessons Learned

• These outcomes-based policies appear to have
  created a further spillover effect on prescribing
  in the province, altering prescribing practices
  of physicians and therefore contributing to
  spending control for all residents of the
  province.
• This was accomplished without any adverse
  effects BC has the highest life-expectancy and
  the lowest overall morbidity in the country.
• In the last 15 years drug costs have risen more
  slowly in BC than in the rest of the country.

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Per capita spending on drugs
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Lessons Learned

• This arrangement offered a degree of transparency
  and separation of roles that cannot be achieved
  by the policy-makers through in-house scientific
  review.
• The TI is accountable only for the validity and
  timeliness of their scientific evaluations
  while the decision-makers are accountable for
  decisions made in light of that evidence.
• When this is achieved, outcomes-based drug
  coverage works to reduce costs while ensuring
  access to the valued output of pharmaceutical
  investment scientifically proven benefit to
  patients health.

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Thank you for your attention
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