New Patented Medicine Regulations in Canada: Case Study of a Manufacturer’s Decision-Making

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Nigel SB Rawson, Ph.D.


The Canadian federal government has proposed sweeping changes for the price review guidelines of the Patented Medicine Prices Review Board (PMPRB), the quasi-judicial agency whose role is to ensure that the prices of patented medicines sold in Canada are not excessive.  The revisions are due to come into effect in 2019.


The objective of this article is to examine the proposed changes in the guidelines and to apply them to a hypothetical case study of the decision-making process that the pharmaceutical manufacturer of a new medication for a rare disorder is likely to go through when assessing whether to seek regulatory approval in Canada under the new PMPRB regulations.


The case study presented here demonstrates that the proposed changes in the PMPRB’s guidelines will create a high level of uncertainty among manufacturers of drugs for rare disorders. Manufacturers will be faced with a decision of whether to introduce a new product into Canada with limited flexibility on how it can be priced across different payers and Canadian health systems, limited visibility on market share, and no certainty regarding what an acceptable price in Canada will be.


The high level of uncertainty being generated by the proposed changes in the PMPRB’s guidelines will imperil the launch of all new medicines in Canada because it will significantly decrease the attractiveness of the country as a priority jurisdiction in which pharmaceutical companies seek regulatory approval for new products. The uncertainty will especially impact manufacturers of new specialty high-cost medications, but it will not be limited to them. The result will be long delays in patient access to important new therapies. In some cases, manufacturers may not seek regulatory approval in Canada if they decide that the Canadian market is not worth the risk of failing to secure a reasonable price in both Canada and other jurisdictions. This would eliminate access for all patients, even those with private insurance. Access to drugs for rare disorders with insurance coverage is already difficult, if not impossible, to obtain for many Canadian patients. The changes in the PMPRB’s regulations are likely to make the situation much worse.

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