1. Centre for H EALTH S ERVICES AND P OLICY R ESEARCH A Decade of Outcomes-Based Drug Coverage in British Columbia Steve Morgan, Ken Bassett, Barbara Mintzes, and Jim Wright University of British Columbia T H E C O M M O N W E A L T H F U N D

2. Centre for H EALTH S ERVICES AND P OLICY R ESEARCH Context: BC British Columbia –4.1 million residents (3 rd largest province) –Domestic Rx Industry generic & biotech Health Coverage –Universal, public insurance for medical and hospital care Rx Coverage: –Mix of private/public/uninsured

3. Centre for H EALTH S ERVICES AND P OLICY R ESEARCH Context: BC PharmaCare Tax-financed public drug benefit plan PharmaCare covered –Social Assistance Recipients –All Seniors –Residents with catastrophic costs –Residents with specific diseases (HIV, Cancer…)

4. Centre for H EALTH S ERVICES AND P OLICY R ESEARCH Context: Cost Crises of 80s and 90s Source: CIHI and Statistics Canada

5. Centre for H EALTH S ERVICES AND P OLICY R ESEARCH How Cost Crisis Played Out in BC 1993 review of PharmaCare Appointment of new Executive Director Management aware of: –Cost-sharing research from US –Cost-impact research done locally Decision: –Limit subsidy based on evidence –Establish process to review evidence

6. Centre for H EALTH S ERVICES AND P OLICY R ESEARCH The Therapeutics Initiative Multi-disciplinary group at UBC –Supported by 5-year grant from Ministry –Small core staff Mandate: –review all products for listing –promote rational drug therapy –advisors to Ministry staff

7. Centre for H EALTH S ERVICES AND P OLICY R ESEARCH Genesis of Coverage Framework 1994 review of nitrate drugs –$3.8M/yr spent on one SR product –Cost 10 times per dose as alternatives –no evidence to distinguish SR efficacy, effectiveness, compliance, or side effects Manufacturer Criticisms –Failed –Engage partners in dialogue

8. Centre for H EALTH S ERVICES AND P OLICY R ESEARCH Evidence Standards Evidence of high standard –Blinded RCTs –Comparative –Published Outcomes approach –Total morbidity/mortality impact –ADRs = part of outcomes –Surrogates must be rationalized –Amenities must yield outcome benefit

9. Centre for H EALTH S ERVICES AND P OLICY R ESEARCH Implementing Framework Reference Drug Program –Applied reference based subsidy to 7 classes –Regular reviews for new evidence of comparative outcome advantages –Generous exemptions + market freedom Rigorously Assessed –Data provided to external research teams –Savings > $12M annually

10. Centre for H EALTH S ERVICES AND P OLICY R ESEARCH Simple Econ of Outcomes Approach Worse Outcomes Better Outcomes Higher Cost Lower Cost Promote Savings Tough Choices Tough Choices Avoid Waste

11. Centre for H EALTH S ERVICES AND P OLICY R ESEARCH Critical Balance

12. Centre for H EALTH S ERVICES AND P OLICY R ESEARCH Key Ingredients Leadership: committed to EBDM Communication: ongoing, two-way Credibility: standards of evidence and standing of advisors Transparency: Communicating process, evidence, and rationale avoids backlash Necessity…

13. Centre for H EALTH S ERVICES AND P OLICY R ESEARCH Thank you