Understanding Public Drug Plan Management - Finding Common

Ground with Private Plans

Dr. Eric Lun, BSc., BSc. Pharm, ACPR, PharmDExecutive Director, Drug Intelligence and Optimization Branch, MBPSD, Ministry of Health

May 9, 2014

Health Spending in Canada – Who pays?

Source: CIHI NHEX 2013

Drugs = 17%$34.5 Bn

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Outline

I. Pharmaceutical Management at PharmaCare

II. Trends and Observations

III. Common Ground & Opportunities

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Pharmaceutical Management isComplex

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Formulary

cb a

Drug Plans

Policies

Provider

Prescriber

Pharmacy

Law / LegislationRegulations

Product Owner

ManufacturerDistributor

Supply Chain

Info Systems

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BC Health System Priorities & Strategies

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Ministry Service Plan

Evidence-informed access to clinically effective and cost-effective pharmaceuticals.

Key Actions: Deliver an accessible, responsive, evidence-informed, sustainable drug

program. Develop opportunities for pharmacists and physicians to work together

to improve the optimal use of drugs for best patient outcomes. Leverage programs such as Lowest Cost Alternative and Reference

Drug Program to achieve the best therapeutic value and price for publicly funded pharmaceuticals.

Engage in the Council of the Federation’s Pan-Canadian Pricing Alliance for brand and generic drugs.

BC Budget from Health Service Plan (released Feb 18, 2014)http://www.bcbudget.gov.bc.ca/2014/sp/pdf/ministry/hlth.pdf

% Total(in $ millions) 13/14 14/15 E 15/16E 16/17E 14/15 E

Regional Services $11,121 $11,524 $11,882 $12,227 68%% Chg 3.6% 3.1% 2.9%$ Chg $402 $359 $345

Medical Services Plan $3,982 $4,062 $4,143 $4,226 24%% Chg 2.0% 2.0% 2.0%$ Chg $80 $81 $83

PharmaCare $1,179 $1,079 $1,103 $1,125 6%% Chg ‐8.5% 2.2% 2.0%$ Chg ‐$100 $24 $22

Other $268 $271 $274 $278 2%% Chg 1.1% 1.2% 1.2%$ Chg $3 $3 $3

Total Expenses $16,551 $16,936 $17,402 $17,855 100%% Chg 2.3% 2.8% 2.6%$ Chg $385 $466 $453

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Medical Beneficiary & Pharmaceutical Services Division

Mission: Lead, innovate and manage the Province’s drug and medical beneficiary programs to improve health outcomes

Branch RoleDrug Intelligence andOptimization (DIO)

The best drugs — decides which drugs PharmaCare will cover, making sure that each drug supports better health and offers good value for taxpayers.

The best prescribing —promotes wise drug use through education and through drug use evaluations

Policy, Outcomes, Evaluation and Research (POER)

The best policies — researches, reviews and analyzes policy options to offer B.C. residents the best coverage. It also keeps residents informed of current policy.

Business Management, Supplier Relations, Systems (BMSRS)

The best deals—develops strategies to get good value for our investment.

Medical BeneficiaryDevelops policy and operational components of the Medical Services Plan for beneficiaries.

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Drug Review -In Search of Value-Add Products

I. II. CDR III. BC Drug Review

(CADTH) Process

Drug Benefit Council

(DBC)

NOC or NOC/c

Efficacy vs. placeboSafetyQuality of manufacture

Health Canada

Ministry of Health

Services

Drug Submission

Drug Review Resource Committee (DRRC)

Drug Benefit Council (DBC) Recommendation

& Reasons

Review Team Reports

Drug File Allocations

DRUG REVIEW RESOURCE TEAMS (DRRT)

MoHSDecision

DRRC Secretariat

PatientInput

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Enhanced Drug Review Process - Updates

DBC: 3 public, 9 professional members

Increased input from stakeholders, including practicing physicians and patients

Created rosters of expert drug review teams

Set target drug review time (6 or 9 or 12m)

Added opportunities for sponsor engagement

Increased transparency of process & decisions

CDR “do not lists” are not re-reviewed at DBC

2013 Drug Review Decisions

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Benefits Non-Benefits

tocilizumabfingolimodrituxumab*rivaroxaban (DVT)*indacaterolapixaban (AF)glycopyrroniumasenapine (bipolar)epinephrine **oseltamivir **alfacalcidol **5-aminosalicylic acid **

ustekinumab **transdermal estradiol gelteleprevir*boceprevir*apixiban (VTE)botox*

colesevelamexenatidefampridinetolvaptanlurasidoneprucalopridedexamethasone intravitrealbelimumabasenapine(schizophrenia)escitalopram **PlerixaforIsotretinoin (Epuris)grass pollen extractpalenosetron

http://www.health.gov.bc.ca/pharmacare/decision.html* criteria modification **line extension

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Prior Authorization -Special Authority Program

>1,400 unique drugs approved for sale in Canada

Facilitates appropriate use of first-line drugs, program sustainability and positive patient outcomes

Non Benefit, Regular Benefit, or Limited Coverage Benefit

Limited Coverage Benefits:

~175 drugs are listed as Limited Coverage

Adjudication by staff, pharmacists, physicians teams

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Therapeutic Reviews & Practice Support InitiativesPractice support initiatives to support the optimal use of

drugs

Therapeutic reviews – evidential reviews of drugs in a related therapeutic area

Supports BC Guidelines

Knowledge translation activities on optimal drug useInform and/or educate prescribers and health professionals (e.g., PAD service), patients and public

BC PharmaCare Patented vs. Generics

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55%36%

9%

PharmaCare Expenditure FY2012/2013: Product Costs

Generic Drugs: 

$269.75 M

Brand Drugs: $414.97 M

Other: $64.24 M

Total:  $748.95 M

Low Cost Alternative (LCA) Program

LCA prices are set at the maximum accepted list price (MALP) for generic drugs in an LCA category

Pharmaceutical Services Act and Regulations (2012)

Drug Price Regulation (2013) Sets limits or conditions on the amount that will be paid for a

particular drug, device, substance or related service that is a benefit

25% of brand on April 1, 2013

20% of brand on April 1, 2014

Section 14 – designation of provisional drugs (i.e. single source generics; drug shortages)

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Reference Drug Program (RDP)

■ Introduced in October 1995.

■ Encourages the use of most cost effective option(s) within the same drug class where therapeutic benefits and risks are similar

■ Coverage is based on the cost of the reference drug(s) in a therapeutic category:

H2 Blockers Nitrates NSAIDs ACE Inhibitors Dihydropyridine CCB

Pan-Canadian Initiatives

Pan-Canadian Pricing Alliance (PCPA) for patented drugs Completes price negotiations for drugs after

CDR and pCODR

Pan-Canadian Price Initiative for Generic Drugs

Pan-Canadian Pricing Initiatives - Generics

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Effective April 1, 2013

EffectiveApril 1, 2014

amlodipine citalopram 

atorvastatin pantoprazolesodium

omeprazole rosuvastatin

rabeprazole simvastatin 

ramipril

venlafaxine

New price point - 18% of brand price

CIHI 2013 Public Drug Spending Growth

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Public forecast = 0%Private forecast = 3.4%

PharmaCare FY 12/13 Trends Report

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Trends: BC PharmaCare Compared to Private

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Total ($M)

% y/y chg

Pt # (M)

$/PtTotal ($M)

% y/y chg

Pt # (M)

$/Pt

FY2008/09 $2,343 $897 0.77     $1,161 $1,446 2.43 $594FY2009/10 $2,477 $931 4% 0.78     $1,194 $1,547 7% 2.50 $618FY2010/11 $2,570 $963 3% 0.79     $1,219 $1,608 4% 2.50 $643FY2011/12 $2,616 $971 1% 0.82     $1,190 $1,645 2% 2.49 $660FY2012/13 $2,617 $960 ‐1% 0.79     $1,211 $1,657 1% 2.55 $649Note: Total PharmaCare paid amount include PharmaCare expenditure on drug ingredient costs and professional fees only.

BC PharmaCare PrivateTotal BC ($M)

FY

Top 10 Claims: BC compared to PharmaCare

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TC4 BC (M) TC4 PC (M)METHADONE 2.50 METHADONE 2.15LEVOTHYROXINE 1.66 QUETIAPINE  1.04RAMIPRIL 1.57 RAMIPRIL 0.93ATORVASTATIN 1.26 LEVOTHYROXINE 0.92QUETIAPINE  1.18 ATORVASTATIN 0.76METFORMIN 1.17 METFORMIN 0.73ZOPICLONE 1.15 FUROSEMIDE 0.65HCTZ 1.03 CITALOPRAM  0.61COD 30 / ACET 300‐325‐375 1.00 HCTZ 0.54ROSUVASTATIN 0.88 METOPROLOL 0.52

Top 10 Spend: BC compared to PharmaCare

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TC4 BC ($M) TC4 PC ($M)INFLIXIMAB $73.2 INFLIXIMAB $50.9ATORVASTATIN $60.6 ADALIMUMAB $35.6ADALIMUMAB $48.0 METHADONE $26.4ROSUVASTATIN $48.0 ETANERCEPT $23.3RAMIPRIL $45.5 ATORVASTATIN $20.1ESCITALOPRAM $43.4 QUETIAPINE $19.1SALMETEROL/FLUTIC. $35.3 ESCITALOPRAM  $15.5METHADONE $34.2 RAMIPRIL $15.3ETANERCEPT $33.6 GABAPENTIN $14.6ESTROGEN/PROGESTIN $33.2 SALMETEROL/FLUTIC. $14.4

Biologics BC Trends

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$M% 

Total% y/y Chg

$/Pt $M% y/y Chg

$/Pt

FY2008/09 $90.4 $50.7 56% $13,630 $39.6 $12,565FY2009/10 $114.2 $69.1 61% 36% $15,011 $45.1 14% $14,944FY2010/11 $144.4 $86.7 60% 25% $15,425 $57.7 28% $14,620FY2011/12 $174.2 $107.8 62% 24% $15,436 $66.5 15% $12,194FY2012/13 $202.9 $129.8 64% 20% $15,627 $73.1 10% $10,363

PrivatePharmaCareFY BC ($M)

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Common Ground & Opportunities w/Private Drug Plans1. Part of same healthcare system

Improve engagement & dialog Independent systems

2. Fiscal Sustainability & Value Generics, biologics & SEBs Emerging drugs – EDRD, HCV

3. Care Continuity PharmaCare tie-in arrangements, data

4. Public health matters Problematic prescription drug use