November 10, 2020
The Patented Medicines Prices Review Board (“PMPRB”) has released its final Guidelines, which come into effect on January 1, 2021 (the “Guidelines”). The Guidelines give effect to the amended Patented Medicines Regulations which come into force on January 1, 2021.
A summary of these changes is described below.
Reassessment for Grandfathered and Line Extension medicines limited to highest international price (“HIP”)
The list price ceiling for Grandfathered and Line Extension medicines is set at the lower of:
the HIP for the PMPRB11 countries; or
the patented medicine’s ceiling price under the prior Guidelines.
The “extra reassessment provision” has been removed. This provision would have required these medicines to further reduce their prices to the median international price (“MIP”) if, in two consecutive subsequent periods, the prevailing MIP was lower than the list price ceiling by more than 10%.
Vaccines to be subject to the same complaints-based investigation criteria as patented biosimilars and generics
The final Guidelines provide that vaccines shall be subject to the same investigation criteria as patented biosimilars and patented generics. Therefore, new patented vaccines will only be subject to a price review and investigation if a complaint is received by the PMPRB.
Maximum Rebated Price (“MRP”) not a trigger to investigation
Pending the Federal Court of Appeal’s ruling on IMC’s appeal of the decision of Justice Manson of the Federal Court (2020 FC 725), absent a complaint being filed, the PMPRB will only commence an investigation into the price of a Category I medicine where it appears that the patentee has failed to comply with the Maximum List Price (“MLP”). The MRP may be a relevant consideration in an investigation at a hearing before the PMPRB.
Allowing for increases in the Maximum Rebated Price for Category I new medicines to the Maximum List Price level
The final Guidelines allow the MRP to be adjusted both downwards and upwards. Therefore, it is possible for the MRP to increase back to the MLP if sales fall to $12 million or less for High Cost medicines, or to $50 million or less for High Market size medicines. The June 2020 Draft guidelines only provided for downward adjustment to the MRP.
Reduction in the Pharmacoeconomic Value Threshold (“PVT”) for Therapeutic Criteria Level IV
The PVT for Therapeutic Criteria Level (“TCL”) IV is $100,000/QALY, as opposed to the $150,000/QALY proposed in the June 2020 Draft guidelines. Therefore, the PVT thresholds are as follows:
$200,000/QALY for TCL I
$150,000/QALY for TCL II and III
$100,000/QALY for TCL IV
Guidelines Monitoring and Evaluation Plan (GMEP)
The PMPRB is developing and implementing a comprehensive Guidelines Monitoring and Evaluation Plan (“GMEP”) to “assess the impact of the Guidelines and inform any future adjustments required to ensure that they are working as intended”.