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The Patented Medicine Prices Review Board has accused the maker of the rare-disease drug Procysbi of charging an excessive for price for the drug, which costs about 65 times more per year than competitor Cystagon, pictured.Fred Lum/The Globe and Mail

Canada’s drug-pricing regulator is accusing an Irish pharmaceutical company of charging an excessive price for a rare-disease drug that sells for nearly $325,000 a year – about 65 times more than an older pill that contains the same medicinal ingredient and treats the same disease.

Staff at the Patented Medicine Prices Review Board say that Horizon Pharma should dramatically slash the price of Procysbi and pay Ottawa as much as $3.15-million to account for the “excess” revenue the company has collected since it began selling the drug in Canada in September, 2017.

“There is no reason why two products which contain the same medicinal ingredient and are indicated for the same condition in the same population should be priced differently,” the board’s staff wrote in a statement of allegations against Horizon released this week.

The Procysbi case is now expected to proceed to a quasi-judicial public hearing, a rare turn of events for a regulator that usually resolves excessive-pricing complaints through voluntary agreements with drug companies.

The allegations against Horizon also come at a critical juncture for the Patented Medicine Prices Review Board (PMPRB) itself.

The Trudeau government promised nearly two years ago to overhaul the regulator so that it could better control Canada’s sky-high drug prices, but the plan has stalled in the face of fierce opposition from the pharmaceutical industry. Changes that were supposed to kick in Jan. 1 have been postponed indefinitely.

Doug Clark, the executive director of the PMPRB, said the government has not told him anything explicit about the fate of the proposed regulations that would have modernized the organization he leads.

“We’re as much in the dark as anybody else,” Mr. Clark said in an interview Thursday. "I don’t think it’s any secret that the [pharmaceutical] industry is very much opposed to these changes and is lobbying vigorously to that effect.”

A Health Canada spokesman said in an e-mail that the department “is taking the time required to carefully consider the comments received during consultations," while a spokesman for Health Minister Ginette Petitpas Taylor reiterated the government’s commitment to bringing drug prices down.

Procysbi is the brand name of a delayed-release version of a drug called cysteamine bitartrate that treats cystinosis, an inherited metabolic disorder that is believed to afflict about 100 people in Canada.

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Erin Little and her daughter Olivia, 8, are photographed in their Port Elgin home on Nov. 21, 2018. Olivia is taking cystagon to treat her cystinosis.Fred Lum

The drug prevents an amino acid called cystine from accumulating in the bodies of cystinosis patients. Left unchecked, cystine crystals cause progressive and lethal damage to organs, beginning with the kidneys.

For decades, Canadian cystinosis patients have had access to an older version of cysteamine bitartrate through Health Canada’s Special Access Programme, which allows unapproved drugs for life-threatening diseases into the country when there are no alternatives available. No company has applied to market the older version, called Cystagon, in Canada because it would be hard to turn a profit on a drug that sells for about $5,000 a year to so few patients.

Once Health Canada approved Procysbi, the Special Access Programme refused to allow Cystagon in, except when doctors successfully argued their patients could not take Procysbi for medical reasons.

The only difference between Procysbi – whose Canadian sticker price works out to about $325,000 a year for an average-sized adult – and Cystagon is that Procsybi has a patented coating that allows patients to take the drug every 12 hours instead of every six.

Horizon argues the twice-a-day dosing schedule makes a significant difference to the lives of patients and their caregivers, who otherwise have to wake up in the middle of the night, every night, to take the cheaper version.

The company has reached confidential pricing deals with every province where cystinosis patients live, and says it offers a financial support program that ensures everyone who needs the drug can get it, regardless of ability to pay.

“PMPRB rejected Horizon’s proposed list price, ignoring its own guidelines and demanding a price reduction that would bring the Canadian price of Procysbi to a small fraction of the lowest price in the world,” Matt Flesch, Horizon’s executive director for product communications, said in an e-mail.

Erin Little, a Port Elgin, Ont., mother whose nine-year-old daughter, Olivia, is still receiving cheaper Cystagon through the Special Access Programme, said Thursday that she was glad to see the drug-pricing regulator take on Horizon over the price of Procysbi – even though the Ontario government would fully cover the cost of either drug for Olivia.

“As a taxpayer, I find it frustrating," Ms. Little said. "If it’s happening in my child’s disease, it’s happening in other diseases.”

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