Pushback from drug companies on Canada’s newest drug pricing regulations has led the country’s regulatory body to reconsider their implementation. Companies cite the push for cost-effectiveness as a reason for withdrawing drug approval applications, cutting jobs, or delaying launches, claiming the new pricing regulations will substantially reduce revenues. 


The original amendments to the Patented Medicines Regulations, so named the Forward Regulatory Plan 2019-2021, aims to modernise the way Canada regulates patented drug prices, constituting the first substantial updates to the country’s drug pricing legislation in over 20 years. The Patented Medicine Prices Review Board (PMPRB) proposed the amendments in late 2017 with the objective of alleviating financial pressure on the country’s healthcare system and driving cost savings for patients. (Source)


The new regulations base drug prices on those from a group of countries with lower prices than the benchmark group currently used to set price ceilings and give regulators the power to review new medicines based on cost-effectiveness. (Source)


Before the most recent version of the new regulations were passed in August, pharma firms lobbied heavily, warning of billions in lost revenue. Some went a step further, threatening to delay or withdraw treatments in response to uncertainty around pricing.  Swiss company Roche withdrew its breast cancer therapy Tecentriq from evaluation in response to the regulations. Merck & Co projected it would cut 145 jobs, amounting to 30 percent of its Canadian staff, due to the new pricing plan. AstraZeneca reported that it delayed treatments for leukaemia and for the genetic disorder neurofibromatosis.


However, PMPRB underscored that the pricing guidelines are still in draft and that the board is contemplating significant changes that could change how the guidelines are applied. Feedback from pharmacos and other stakeholders is being taken into consideration by the PMPRB, according to Executive Director Doug Clark, adding that companies would be given plenty of time to comply with the regulations and that the new measures may only be applied to specific treatments at risk of being excessively priced.