This article originally appeared in the Financial Post.
By Nigel Rawson and John Adams, October 9, 2024
The federal government is creating yet another new agency, Health Emergency Readiness Canada (HERC), which will be “dedicated to protecting Canadians against future pandemics and delivering on Canada’s life sciences and medical countermeasures readiness objectives.” It’s only three years behind the European Union’s readiness initiative. And all we have so far is a press release.
This country was not prepared for the COVID-19 pandemic, which stressed our health system beyond its capacity. We had few vaccine production facilities and a federal government unwilling to collaborate with and invest in recognized vaccine developers.
Instead, the Liberals made a poor deal with a Chinese company, which promptly came undone, and then supported a vaccine, developed by Medicago, that only became available long after global biopharmaceutical giants had already supplied Canada and much of the world. They also invested nearly $130 million in a new facility in Montreal that has yet to produce any vaccines. Perhaps it’s not surprising that the government has not instituted a public inquiry into how it handled the pandemic, as the United Kingdom did.
When Ottawa declares that HERC will “serve as Canada’s focal point to help mobilize industry to respond in a coordinated approach to public health needs and to support the growth of a domestic life sciences sector,” a fair question is: how? How will the federal government “mobilize” an industry that predominantly consists of multinational organizations based in other countries?
Over decades federal actions have handcuffed the Canadian affiliates of these multinationals when they compete to attract investment from their head offices for research, manufacturing and the early launch of new medicines in Canada. Our lack of investment in COVID-19 vaccine R&D and manufacturing demonstrated this reality. Canada is well down multinational companies’ priority lists for launching innovative medicines and vaccines.
Canadian governments have created several agencies to gatekeep our health-care system. But their effect has often been to discourage R&D. One such agency, Canada’s Drug Agency, formerly the Canadian Agency for Drugs and Technologies in Health, performs health technology assessments, which take months if not years, and recommends whether or not new medicines should be reimbursed by the same governments that own and fund these agencies. Its recommendations are based on inadequate data, metrics and assumptions and use a threshold of cost-effectiveness that has not been updated since the 1990s. Recommendations for price reductions of 70 per cent or more are common.
The same governments have also created their own price-negotiating organization — the pan-Canadian Pharmaceutical Alliance (pCPA) — another gatekeeper whose actions further delay access for patients with unmet health needs. And even when new drugs do make it over these obstacles, government drug plans require further negotiations on price and other conditions before they will add new medicines to their coverage lists. Listing doesn’t mean all patients can access coverage. Criteria based on recommendations from health technology assessments are regularly imposed, limiting coverage only to patients who conform with the conditions.
Drug developers must also comply with the regulations of a third gatekeeper, the Patented Medicine Prices Review Board (PMPRB), whose role is to ensure that drug prices in Canada are not “excessive.” With price negotiations being performed by the pCPA and individual drug plans, the PMPRB is superfluous. Ottawa clearly knows this: it exempted COVID-19 vaccines and medicines from PMPRB scrutiny.
With these government-erected barriers still in place, it’s hard to see how HERC will mean “Canadians could get faster access to the most relevant and effective vaccines, therapeutics, diagnostics and other products, including when they need them the most.” Canadians have seen delays and denials of access to innovative medicines for too long to believe such happy-talk.
Only a radical change in Canada’s pharmaceutical environment can ensure our country both is prepared for the next pandemic when (not if) it occurs and is able to encourage developers to launch innovative medicines more quickly. One approach would be to allow Canadians to access new medicines and vaccines as soon as Health Canada approves them so they can take advantage of them while real-world and therefore more reliable evidence on their benefits, risks and costs is collected.
Without fundamental change that requires governments to be more collaborative with the biopharmaceutical industry and recognize the benefits of innovative medicines, HERC will be just smoke and mirrors. Let’s not confuse a press release with reality.
Nigel Rawson is a senior fellow with the Macdonald-Laurier Institute, as is John Adams, co-founder and CEO of Canadian PKU and Allied Disorders Inc.
