In this article, we explain the different processes through which governing bodies approve medications for coverage under public drug plans in Canada. This is a simplification of the approval pathway, which includes reviews and negotiations. There are variations to this pathway for drugs covered under private insurance, or when you have no drug coverage, and for drugs administered via hospitals, but we have not described them here. This summary outlines the many areas in which the GI Society advocates for medication coverage on your behalf.


Health Canada

  • considers evidence from clinical trials submitted by pharmaceutical manufacturers to decide if a drug or biologic is safe and effective for sale
  • if so, it issues a Notice of Compliance and the manufacturer can sell the drug in Canada
  • monitors therapies post-approval for ongoing safety and effectiveness


Patented Medicine Prices Review Board

  • operates under the Patent Act and is an independent quasi-judicial federal body with a dual mandate: Regulatory: to ensure that prices charged by patentees for patented medicines sold in Canada are not excessive, and Reporting: to report on pharmaceutical trends of all medicines and on research
  • compares the price to the median price set in the ‘basket’ of these 7 comparator countries: France, Germany, Italy, Sweden, Switzerland, the UK, and the US
  • prices set by PMPRB are the ‘retail’ price, which might then be subject to negotiations between manufacturers and public and private drug plans; those who are not covered or private drug plans pay this PMPRB price directly at the pharmacy
  • does not review generics


Health Technology Assessment (HTA)

  • primary HTA body is the Canadian Agency for Drugs and Technology in Health (CADTH), which conducts reviews in two streams: the Common Drug Review (CDR) and the pan-Canadian Oncology Drug Review (pCODR). CADTH is an independent, not-for-profit organization responsible for providing health care decision-makers with objective evidence to help make informed decisions about the optimal use of health technologies, including drugs, diagnostic tests, and medical, dental, and surgical devices and procedures. In addition to evidence, it also provides advice, recommendations, and tools.
  • CDR program for non-cancer drugs considers patient input and clinical and economic evidence
  • pCODR program for oncology drugs considers clinical, economic, patient input, and ease of implementation ‘equally’ as its deliberative framework
  • CDR and pCODR each decide the ‘value’ of the drug relative to others available and relative to opportunity costs of funding this drug versus other drugs, then recommend a yes, a yes with conditions – usually a pricing reduction – or no to provincial funding bodies in health ministries
  • Quebec has L’Institut national d’excellence en santé et en service sociaux (INESSS) for HTA


pan-Canadian Pharmaceutical Alliance

  • pCPA is a joint provincial/territorial/federal body that manages the process of private negotiations with manufacturers to find acceptable, undisclosed, drug prices, eligibility criteria, and risk sharing arrangements (rebates, expenditure caps, etc.)
  • claims to have saved the public programs $712 million per year as of April 1, 2016, on brand and generic products
  • as of January 31, 2017, it has 38 products under active negotiation, 133 products completed (i.e., a signed Letter of Intent or unable to agree), 49 products not being negotiated at any level, and 13 products being negotiated individually by public plans
  • challenges include:
    • there is not a way for patients to have the drugs covered while negotiations are ongoing, unless the manufacturers provide it under a compassionate program
    • there is no time limit for negotiations, and
    • once negotiated, the provinces or territories still need to determine whether they will add it to their formulary


Provincial, Territorial, and Federal Public Plans

  • once a pCPA negotiation is complete, each provincial, territorial, or federal public drug plan makes a decision on whether to include the drug in its list of covered medications (formulary)
  • each jurisdiction is responsible to its own government for fiscal restraints and so drug formularies across the country vary drastically, meaning that coverage for Canadians is not consistent, and it is very much a case of coverage depending on postal code
  • the various jurisdictions have a myriad of cost-reduction strategies that range from generic products to substituting one type of medication for another, and refining eligibility criteria

First published in the Inside Tract® newsletter issue 201 – 2017
Photo by ChristianeFe. photography from Pexels