Government spending on prescription drugs grew by 7 per cent across the country last year, an increase driven by the high prices of some medications and by Ontario’s decision to briefly expand public coverage for everyone under 25.
Ontario’s OHIP+ plan, which covered all children and youth before it was scrapped last spring, accounted for half of the total increase in Canada’s public drug spending in 2018, according to a new report from the Canadian Institute for Health Information, the country’s official health-care statistics agency.
Jordan Hunt, CIHI’s manager of pharmaceuticals, said OHIP+ moved the national spending needle so dramatically because nearly 2.3 million patients made at least one claim under the program in 2018.
“Although these were, on average, folks with much lower drug costs," he said, "it was just the sheer volume of individuals that were moved to the public drug program that had such a big impact.”
CIHI’s analysis of $14.5-billion in public drug spending in 2018, released Tuesday, comes as Prime Minister Justin Trudeau’s re-elected minority Liberal government tries to build some form of national pharmacare.
In his mandate letter for new federal Health Minister Patty Hajdu, Mr. Trudeau listed implementing a “national universal pharmacare” program as a top priority, beginning with the creation of a new Canada Drug Agency, a national “formulary,” or list of drugs to be covered for all, and a strategy for rare-disease drugs.
The federal Liberals campaigned on implementing pharmacare guided by the report of a national advisory council led by Eric Hoskins, the physician and former Ontario health minister who created the OHIP+ program.
“OHIP+ was a universal program where everything was transitioned to the public sector," said Michael Law, a University of British Columbia professor who holds a Canada Research Chair in Access to Medicines. “It’s a bit of preview for, I think, the debate to come over the next year or two about what shape national pharmacare takes.”
When the Ontario Progressive Conservatives, led by Doug Ford, swept the Ontario Liberals from office in June, 2018, the new government made reversing OHIP+ one of its first acts. Mr. Ford’s government said it would continue to cover prescription drug costs for people 24 and younger only if they do not have private insurance.
The CIHI report found that, in 2018, Ontario spent $638.7-million on prescription drugs for children and youth not previously covered by a public plan – 37 per cent more than the $465-million a year the Ontario Liberals predicted the OHIP+ program would cost when they unveiled it in 2017.
Dr. Law pointed out that even pharmacare’s biggest boosters acknowledge that creating a universal, single-payer national program – as Dr. Hoskins’s group recommended in June – would necessitate a large increase in public spending.
But pharmacare advocates argue that total spending by all payers, including workplace benefit plans and individual patients, would drop, thanks in part to the negotiating power of a single government buyer, he said.
Regardless of what happens on the federal front, provincial governments still have to keep their public drug plans solvent at a time when high-priced drugs taken by relatively few patients are eating up more and more of their budgets.
Last year, Canadians with annual drug bills of $10,000 or more accounted for 38.8 per cent of all public drug spending, up from 36.6 per cent the year before, despite such patients accounting for just 2 per cent of beneficiaries.
The top high-priced drug in terms of public spending was a Hepatitis C treatment called sofosbuvir and velpatasvir, sold under the brand Epclusa.
Epclusa carries a sticker price of nearly $55,000 for a three-month course of treatment that almost always cures patients of the liver-destroying virus. (The real price is almost certainly lower, thanks to confidential discount deals between provinces and the drug company.)
For the seventh year in a row, anti-TNF drugs, a category of biologic drugs that treat rheumatoid arthritis, Crohn’s disease and other autoimmune conditions, accounted for the largest proportion of public drug program spending, at 8.3 per cent of the total.
The category includes Remicade and Enbrel, both of which are off-patent and are facing competition from less-expensive near copies called biosimilars.
Alberta announced last week that it would be joining British Columbia in switching patients with government-sponsored drug coverage to biosimilars.
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