Stephen Frank (Canadian Life and Health Insurance Association): Managing Value for Sponsors and Users in Public and Private Drug Plans
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Canadian Expert Patients in Health Technology Conference Nov 7 – 8, 2016: Day 2
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Stephen Frank (Canadian Life and Health Insurance Association): Managing Value for Sponsors and Users in Public and Private Drug Plans
- 1. 1 Canadian Expert Pa.ents in HTA Managing Value for Sponsors and Users in Private Drug plans November 8, 2016 Stephen Frank Senior Vice President, Policy 1
- 2. Agenda • Context • Employer responses • Insurance company responses • Thoughts on orphan drugs – greater collaboraGon is needed • Summary 2
- 3. PrescripGon Drugs: costs are rising again • 2012 – 14 cost growth – while at historical lows – remained higher for private payers than provinces • But, we are through the patent cliff now and costs are rising back to more of the historical average – Specialty drugs driving much of this and pose serious concern – New challenge: mass market + high costs = budget buster – Coming Challenge: Orphan Drugs • PotenGal for fundamental pharmacare reform is growing – PMPRB, PCPA, HoC Health CommiVee, Council of FederaGon etc. 3
- 4. Employer Responses: • Employers want aggressive cost management • Impact on employees is a key factor that impacts types of controls they will consider • Openness to change is growing however, and more management of plans is a trend in the market • Employers also asking for more aggressive interpretaGons of coordinaGon rules with government plans
- 5. Insurance Company Responses: • All carriers are acGvely promoGng numerous drug plan management soluGons to clients. For example: – Promote / require generic subsGtuGon and managed formulary designs – Preferred Provider Networks – Cost controls at point of service – maximum drug pricing, limitaGons in mark-‐up, frequency of dispensing (90 day for generic) – Pharmacy agreements – Prior authorizaGon -‐ right drug, right Gme – Case management – including health coaching • In April 2012, industry launched a Canada wide drug pooling soluGon for all fully insured plans 5
- 6. Thoughts on Orphan Drugs – need greater collaboraGon • The net impact of proposed orphan drug regime is expected to be: – An increase in the number of orphan drugs on the Canadian market, – Approvals for new drugs earlier in the development stage when clinical data may not yet be conclusive – Growing fiscal impact from ultra-‐rare drugs • The rarity and cost of orphan drugs means suggests much greater collaboraGon between public and private payers is needed – Both on HTA and pricing negoGaGons 6
- 7. In summary • PotenGal for fundamental changes to the market • AcceleraGng cost pressures on all payers as more rare(ish) high cost drugs come to market • Employers are warming to more management of formularies and insurers are responding • Best approach will be greater collaboraGon between public and private payers 7