How Good Is Your Drug Insurance?

Canadian Health Policy 2014

1

Comparing Access to New Drugs in Canadas Federal and
Provincial Public Drug Plans



Author(s)
Canadian Health Policy
Institute (CHPI).


Publication Date
June 25, 2014.

Citation
CHPI (2014). Comparing
Access to New Drugs in
Canadas Federal and
Provincial Public Drug Plans.
Annual Series: How Good Is
Your Drug Insurance?
Canadian Health Policy, June
25, 2014. Toronto: Canadian
Health Policy Institute.

Copyright
All rights reserved.
Unauthorized reproduction
of this article in whole or in
part is strictly prohibited.



SUMMARY

Introduction
It is roughly estimated that as of 2012, 11.3 million Canadians were eligible for
coverage under public drug insurance programs, including 10.3 million provincial-
territorial residents and nearly 1 million federally insured aboriginal people. The
quality of coverage varies significantly between public drug plans. Some jurisdictions
provide much better benefits for their publicly insured populations than do other
jurisdictions. This study ranks the quality of coverage for new drugs under federal
and provincial public drug plans from best to worst.

Objective
To compare benefits under Canadas public drug programs in terms of the number of
new drugs approved for public insurance coverage, as well as the time that patients
must wait for publicly insured access to new drugs.

Data
The most recent data were obtained from Health Canada and IMS Brogan covering
the period from January 1, 2004 to December 1, 2013.
Results
Averaged across all public plans and across all years observed, of the 412 new drugs
approved for sale by Health Canada over the 9-year period from 2004-2012 only
23.1% were covered for full or partial public coverage as of December 1, 2013. Of
the new drugs that were eventually covered, it took on average 733 days for public
drug plans to list a new drug on their formularies.
The quality of insured access to new drugs varies significantly between public drug
plans. Some jurisdictions provide much better access for their publicly insured
populations than do other jurisdictions. Quebec and Ontario provide the highest
coverage rates for new drugs, while Manitoba, Alberta, British Columbia and the
federal NIHB provide the lowest coverage rates.
Quebec had the shortest delays to listing new drugs for reimbursement on its public
drug plan, while New Brunswick, PEI and Ontario had the longest delays to listing.
New Brunswick and Quebec had the highest number of new drugs listed for full
reimbursement, while Manitoba, British Columbia, the NIHB, Ontario and
Saskatchewan had the lowest number of full reimbursements.
Conclusions
Overall, Quebec appears to provide the best access to new drugs under its public
drug plan. However, it is important to put the performance of all public drug plans in
the context of benchmarks set by private sector insurance plans. Other CHPI
research confirms that all public drug plans in Canada provide much lower quality of
coverage for new drugs than do private sector drug insurance plans.
How Good Is Your Drug Insurance? Canadian Health Policy 2014

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HIGHLIGHTS

Who has the worst rate of publicly funded coverage for new drugs in Canada?
Chart 1. Percentage of new drugs* approved for sale by Health Canada from 2004 to 2012,
that were listed for federal/provincial public insurance coverage as of December 1, 2013.


*Drugs that are still awaiting insurance approval decisions are not counted and therefore, the actual results that will be
reported in the future will change as ongoing decisions are eventually completed. For this reason year-to-year comparisons are
less meaningful than comparisons within years or across the entire period. Data: Health Canada (2013); IMS Brogan (2013).
Calculations: CHPI (2014).








16.7% 17.0%
18.9% 18.9%
19.7%
20.9%
24.0%
25.2% 25.2%
29.6%
38.3%
100%
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Who waits longest for publicly funded coverage for new drugs in Canada?
Chart 2. Average wait (days) for federal/provincial public insurance coverage of new drugs
approved for sale by Health Canada from 2004 to 2012, as of December 1, 2013.

Data: Health Canada (2013); IMS Brogan (2013). Calculations: CHPI (2014).


NB
PEI
ON
BC
MB
AB
NL
NS
SK
NIHB
QC
1027
948
826
787
781
700
661
660
620
617
434
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Who has the best scope of publicly funded coverage for new drugs in Canada?
Chart 3. Number of new drugs approved by Health Canada from 2004 to 2012 that received
full versus partial* public drug coverage, as of December 1, 2013.
*Drugs with recorded data entries showing full AND partial coverage by a public plan over the observed period are recorded as
full coverage in order to avoid double-counting. Data: Health Canada (2013); IMS Brogan (2013). Calculations: CHPI (2014).

AB BC MB NB NIHB NL NS ON PEI QC SK
30
24 23
96
29 31
34
29
34
56
29
40 54
46
8
49
55
65
93
47
102
75
Full coverage Partial coverage
How Good Is Your Drug Insurance? Canadian Health Policy 2014

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INTRODUCTION
Publicly administered universal medicare
programs cover hospital and physician services
but exclude prescription drugs (except for drugs
administered in hospitals). The federal and
provincial-territorial governments operate
separate publicly funded programs on a non-
universal basis covering prescription drugs for
specially targeted segments of the population,
or on a universal basis but with large
deductibles that exclude most prescription drug
expenses from eligibility for public
reimbursement.

Nevertheless, a significant number of Canadians
depend largely (if not entirely) on publicly
funded drug coverage to access necessary
prescription medicines. Approximately 11.3
million Canadians are eligible to be insured
under public drug programs that pay for
necessary prescription drugs.
1
Over 23 million
Canadians have private drug insurance, mostly
as a benefit obtained through employment.
2
It
is estimated that an additional 700,000
Canadians have no insurance to pay for drugs.
3


Eligibility for public drug insurance coverage
varies by jurisdiction. The federal government
operates five separate public drug plans
covering over 1 million people including
military, RCMP, veterans, federal prison
inmates and aboriginal populations.
4
Aboriginal
peoples account for most of the federally
insured population and are covered under the
Non-insured Health Benefits (NIHB) program.
The provinces and territories separately operate
their own public drug plans for eligible residents
of their jurisdictions covering about 10.3 million

1
Calculation: total population of approx. 35 million
(Statistics Canada 2012, as of the end of year 2012), minus
privately insured population, minus uninsured population.
2
CLHIA (2012). Estimate from 2010.
3
Parliament of Canada (2002). Estimated 2% of total
population.
4
Health Canada (2012).
people in total, most of whom are seniors or
lower-income families.
5

This annual study compares access to new
drugs for patients covered under each of the 11
federal and provincial public drug programs
across Canada.

Good drug insurance should provide financial
protection from the unexpected and
unaffordable cost of accessing necessary drugs
should you or your family become ill.

This research shows that the quality of coverage
varies significantly between public drug plans.
Some jurisdictions provide much better benefits
for their publicly insured populations than do
other jurisdictions.

OBJECTIVE

To compare coverage for new drugs under
federal/provincial public drug plans in Canada
and rank the federal and provincial public drug
plans from best to worst.
DEFINITIONS

In this study, the quality of drug insurance
coverage is defined by:

1. The percentage of new drugs covered under
the drug plan.

2. The wait in days for new drugs to be covered
under the drug plan.

3. The scope of public drug coverage -
unrestricted/unconditional (categorized as
full) or restricted/conditional (categorized as
partial).






5
Calculation derived from above data.
How Good Is Your Drug Insurance? Canadian Health Policy 2014

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DATA

The two data sources used for this analysis
were Health Canada and IMS Brogan.

Health Canada data was used to identify the
total number of new drugs that were available
to be covered under public drug plans. The data
included all New Drug Submissions (NDSs)
6
that
received a Notice of Compliance (NOC)
7
from
Health Canada between 2004 and 2012. NDSs
are defined as an application made by a
manufacturer to Health Canada to authorize a
safe, efficacious, and high-quality drug (Health
Canada 2007a). They include any drug that has
not previously been approved by Health Canada
or a new combination of previously approved
drugs.

The public drug plan coverage analysis used all
available data from IMS Brogan (2013) on new
formulary listings in public drug plans in
Canada. IMS Brogans iMAM database provides
comprehensive data recording the date at
which new drugs are added to public drug plan
formularies for full or partial coverage (IMS
Brogan 2013).

All provincial public drug insurance plans were
included in addition to the federal Non-Insured
Health Benefits Plan (NIHB).
METHODS

Drug Coverage Rates

Drug plan coverage rates were calculated as the
total number of new drugs that received full or
partial insurance coverage recorded in each
public plan (as of December 1st, 2013), stated

6
This study includes pharmaceutical and biologic NDSs.
Pharmaceutical drugs are chemically synthesized products;
whereas biologic drugs are created using biologic
processes in living cells (BIOTECanada 2011).
7
Under the regulations of the Food and Drugs Act, each
new drug must be issued a NOC from Health Canada
before it can be sold in the Canadian market (Health
Canada 2007b).
as a percentage of the total number of new
drugs approved for sale by Health Canada in
each year from 2004 to 2012.
National averages across all jurisdictions are
reported as an average of the observed
coverage rates within each jurisdiction.

Drug Coverage Delays

The wait for coverage of new drugs was
calculated from the date that the new drug was
approved for sale by Health Canada (marked by
the issuance of a NOC) to the date at which the
drug was listed on a provincial/federal public
drug plan formulary.
Coverage delays are reported as an average
across all new drugs that have been partially or
fully covered by the public drug plans within
each jurisdiction, as of December 1, 2013.
Drugs that have not yet been recorded on a
public formulary listing were not included in the
analysis of delays.
National averages across all jurisdictions are
reported as an average of the observed average
delays within each jurisdiction.
Full vs. Partial Coverage

The scope of coverage was calculated as the
total number of new drugs that received full
coverage (unrestricted/unconditional) versus
those that received partial coverage
(restricted/conditional) for each of the
federal/provincial public drug plans, as of
December 1, 2013.

New drugs with reported data entries for full
AND partial coverage by a public plan over the
observed period are recorded as full coverage
in order to avoid double-counting.





How Good Is Your Drug Insurance? Canadian Health Policy 2014

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RESULTS

Drug Coverage Rates

The data show that overall federal/provincial
public drug plans refused to cover the vast
majority of new drugs approved by Health
Canada from 2004 to 2012. Table 1 shows the
annual coverage rates for new drugs by drug
plan over the entire period observed. A total for
the entire period is also shown for each
jurisdiction as well as for all jurisdictions
combined.

In summary, as of December 1, 2013, averaged
across all public drug plans:
22.2% of new drugs approved for sale by
Health Canada in 2004 were covered by
public plans.
19.2% of new drugs approved for sale by
Health Canada in 2005 were covered by
public plans.
32.7% of new drugs approved for sale by
Health Canada in 2006 were covered by
public plans.
29.1% of new drugs approved for sale by
Health Canada in 2007 were covered by
public plans.
31.4% of new drugs approved for sale by
Health Canada in 2008 were covered by
public plans.
25.1% of new drugs approved for sale by
Health Canada in 2009 were covered by
public plans.
15.9% of new drugs approved for sale by
Health Canada in 2010 were covered by
public plans.
24.2% of new drugs approved for sale by
Health Canada in 2011 were covered by
public plans.
8.2% of new drugs approved for sale by
Health Canada in 2012 were covered by
public plans.

The average insurance approval rate (averaged
across all public plans) for new drugs approved
by Health Canada over the entire period from
2004 to 2012 was 23.1%.

There are significant differences in the number
of new drugs approved for insurance coverage
between public drug plans. Chart 1 displays the
coverage rates by drug plan as a percentage of
all new drugs approved by Health Canada from
2004 to 2012.

In summary, as of December 1, 2013:

Quebecs public plans covered the highest
percentage of new drugs: 38.3%.

Manitobas public plans covered the lowest
percentage of new drugs: 16.7%.

Drug Coverage Delays

The data indicate that over the observed
period, patients waited a long time for insured
access to new drugs across all federal/provincial
public plans. Of the new drugs that were
eventually covered, it took on average 733 days
for public drug plans to list a new drug on their
formularies (Table 2).
The data also show that the delay to public
insurance coverage of new drugs varied
significantly between jurisdictions within years.
Table 2 displays the average time in days
between when new drugs were approved for
sale by Health Canada (from 2004 to 2012) and
coverage under public drug plans by year of
approval.

Chart 2 displays the average time in days
between when new drugs were approved for
sale by Health Canada and when the drugs were
listed for coverage under public drug plans.

In summary, as of December 1, 2013:
Quebec had the shortest average wait to
listing a new drug for coverage under the
public drug plan (434 days).
How Good Is Your Drug Insurance? Canadian Health Policy 2014

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New Brunswick had the longest average
wait to listing a new drug for coverage
under the public drug plan (1027 days).

Full vs. Partial Coverage

Table 3 and Chart 3 show that between public
drug plans there is a significant difference in the
scope of coverage (full vs. partial) for new
drugs.

In summary, as of December 1, 2013:

New Brunswick listed the highest number of
new drugs as full reimbursements (96).
8


Manitoba listed the lowest number of new
drugs as full reimbursements (23).

CONCLUSIONS

The quality of insured access to new drugs
varies significantly between public drug plans.
Some jurisdictions provide much better access
for their publicly insured populations than do
other jurisdictions.

Quebec and Ontario provide the highest
coverage rates for new drugs, while Manitoba,
Alberta, British Columbia and the federal NIHB
provide the lowest coverage rates.

Quebec had the shortest delays to listing new
drugs for reimbursement on its public drug
plan, while New Brunswick, PEI and Ontario had
the longest delays to listing.

New Brunswick and Quebec had the highest
number of new drugs listed for full
reimbursement, while Manitoba, British

8
On December 10
th
2013, the New Brunswick government
introduced the New Brunswick Drug Plan a publicly
funded prescription drug plan that will be fully
implemented on April 1, 2015. As the Plan was announced
on December 10, 2013 and will not be fully implemented
until April 1, 2015, the data included in this analysis does
not reflect the provinces current drug insurance reforms.
Columbia, the NIHB, Ontario and Saskatchewan
had the lowest number of full reimbursements.

Overall, Quebec appears to provide the best
access to new drugs under its public drug plan.

However, it is important to put the
performance of all public drug plans in the
context of benchmarks set by private sector
insurance plans. Other CHPI research confirms
that all public drug plans in Canada provide
much lower quality of coverage for new drugs
when compared to private sector drug
insurance plans.
9


REFERENCES

BIOTECanada (2011). Advocacy and Policy. URL:
http://www.biotech.ca/en/policy-matters/health-
bio/seb.aspx.

Health Canada (2002). Special Access Programme Drugs.
Drugs and Health Products.
URL: http://www.hc-sc.gc.ca/dhp-mps/acces/drugs-
drogues/index-eng.php. Updated: 2008-01-29.

Health Canada (2007a). Drugs and Health Products:
Glossary. Government of Canada. URL: http://www.hc-
sc.gc.ca/dhp-mps/homologation-licensing/gloss/index-
eng.php#n.

Health Canada (2007b). Drugs and Health Products: New
Drug Submission. Government of Canada. URL:
http://www.hc-sc.gc.ca/dhp-mps/homologation-
licensing/system/map-carte/nds-pdn_txt-eng.php.

Health Canada (2012). Access to insurance coverage for
prescription medicines. URL: http://www.hc-sc.gc.ca/hcs-
sss/pharma/acces/index-eng.php.

Health Canada (2013). Special Data Request.

IMS Brogan (2013). Special data request to iMAM
database.

9
CHPI (2014). Private versus public drug coverage in
Canada: Experience shows competition and choice are
better than government-run Pharmacare. Annual Series:
How Good Is Your Drug Insurance? Canadian Health Policy,
February 21, 2014. Toronto: Canadian Health Policy
Institute. URL:
http://www.canadianhealthpolicy.com/research/full-
text/private-versus-public-drug-coverage-in-canada.html.

How Good Is Your Drug Insurance? Canadian Health Policy 2014

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DATA TABLES

Table 1. New drugs approved for federal/provincial public insurance coverage (full or partial), as of
December 1, 2013.


2004 2005 2006 2007 2008 2009 2010 2011 2012 2004 - 2012

TOTAL NOCs
from Health
Canada
50 43 49 44 31 46 44 66 39 412
AB
Total covered 9 4 11 10 7 9 6 13 1 70
as a % of NOCs 18.0% 9.3% 22.4% 22.7% 22.6% 19.6% 13.6% 19.7% 2.6% 17.0%
BC
Total covered 8 3 9 11 9 13 7 17 1 78
as a % of NOCs 16.0% 7.0% 18.4% 25.0% 29.0% 28.3% 15.9% 25.8% 2.6% 18.9%
MB
Total covered 9 5 11 10 8 8 4 10 4 69
as a % of NOCs 18.0% 11.6% 22.4% 22.7% 25.8% 17.4% 9.1% 15.2% 10.3% 16.7%
NB
Total covered 11 12 20 15 11 10 6 17 2 104
as a % of NOCs 22.0% 27.9% 40.8% 34.1% 35.5% 21.7% 13.6% 25.8% 5.1% 25.2%
NIHB
Total covered 12 8 15 10 9 11 5 8 N/A 78
as a % of NOCs 24.0% 18.6% 30.6% 22.7% 29.0% 23.9% 11.4% 12.1% N/A 18.9%
NL
Total covered 10 8 18 13 11 7 6 11 2 86
as a % of NOCs 20.0% 18.6% 36.7% 29.5% 35.5% 15.2% 13.6% 16.7% 5.1% 20.9%
NS
Total covered 9 9 17 10 9 10 7 26 2 99
as a % of NOCs 18.0% 20.9% 34.7% 22.7% 29.0% 21.7% 15.9% 39.4% 5.1% 24.0%
ON
Total covered 11 9 20 16 10 19 11 20 6 122
as a % of NOCs 22.0% 20.9% 40.8% 36.4% 32.3% 41.3% 25.0% 30.3% 15.4% 29.6%
PEI
Total covered 12 9 17 13 8 8 4 9 1 81
as a % of NOCs 24.0% 20.9% 34.7% 29.5% 25.8% 17.4% 9.1% 13.6% 2.6% 19.7%
QC
Total covered 18 14 22 21 15 21 13 25 9 158
as a % of NOCs 36.0% 32.6% 44.9% 47.7% 48.4% 45.7% 29.5% 37.9% 23.1% 38.3%
SK
Total covered 13 10 16 12 10 11 8 20 4 104
as a % of NOCs 26.0% 23.3% 32.7% 27.3% 32.3% 23.9% 18.2% 30.3% 10.3% 25.2%
Average as a % of NOCs 22.2% 19.2% 32.7% 29.1% 31.4% 25.1% 15.9% 24.2% 8.2% 23.1%

Data: Health Canada (2013); IMS Brogan (2013). Calculations: CHPI.


How Good Is Your Drug Insurance? Canadian Health Policy 2014

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Table 2. The average wait (days) for federal/provincial public insurance coverage of new drugs, as of
December 1, 2013.


2004 2005 2006 2007 2008 2009 2010 2011 2012 2004 - 2012
AB 708 1374 832 1043 570 700 340 379 358 700
BC 701 1923 972 965 600 621 474 474 349 787
MB 587 934 1088 774 776 1107 773 585 403 781
NB 1405 1454 1360 1163 1065 1000 707 553 536 1027
NIHB 697 974 868 619 364 605 485 327 N/A 617
NL 1059 1023 666 766 563 620 395 329 528 661
NS 687 1234 769 628 632 614 516 482 383 660
ON 1419 1199 1085 958 561 794 612 440 366 826
PEI 1469 1001 1128 1105 954 850 1095 591 341 948
QC 520 656 514 327 363 537 323 349 316 434
SK 559 1081 716 881 377 727 466 448 326 620
Nation Average 892 1168 909 839 620 743 562 451 391 733

Note: It is very important to note that the data include only the drugs for which a positive insurance approval
decision has been finalized. Drugs that are rejected for insurance coverage are excluded. Drugs that are still
awaiting insurance approval decisions are not counted and therefore, the actual results that will be reported in the
future will change as ongoing decisions are eventually completed. For this reason year-to-year comparisons are
less meaningful than comparisons within years or across the entire period. Data: Health Canada (2013); IMS
Brogan (2013); calculations CHPI.























How Good Is Your Drug Insurance? Canadian Health Policy 2014

11


Table 3. Number of new drugs that received full v. partial public drug coverage under public drug
plans, as of December 1, 2013.


Coverage 2004 2005 2006 2007 2008 2009 2010 2011 2012 2004 - 2012
AB
Total covered 9 4 11 10 7 9 6 13 1 70
Full coverage 4 1 5 7 4 3 1 5 0 30
Partial coverage 5 3 6 3 3 6 5 8 1 40
BC
Total covered 8 3 9 11 9 13 7 17 1 78
Full coverage 3 2 5 5 2 4 1 2 0 24
Partial coverage 5 1 4 6 7 9 6 15 1 54
MB
Total covered 9 5 11 10 8 8 4 10 4 69
Full coverage 5 2 5 4 2 3 1 1 0 23
Partial coverage 4 3 6 6 6 5 3 9 4 46
NB
Total covered 11 12 20 15 11 10 6 17 2 104
Full coverage 9 11 19 15 11 10 6 15 0 96
Partial coverage 2 1 1 0 0 0 0 2 2 8
NIHB
Total covered 12 8 15 10 9 11 5 8 0 78
Full coverage 4 3 7 1 5 4 1 4 0 29
Partial coverage 8 5 8 9 4 7 4 4 0 49
NL
Total covered 10 8 18 13 11 7 6 11 2 86
Full coverage 6 5 7 3 4 3 1 1 1 31
Partial coverage 4 3 11 10 7 4 5 10 1 55
NS
Total covered 9 9 17 10 9 10 7 26 2 99
Full coverage 3 4 5 2 2 4 1 13 0 34
Partial coverage 6 5 12 8 7 6 6 13 2 65
ON
Total covered 11 9 20 16 10 19 11 20 6 122
Full coverage 4 3 4 7 3 5 0 3 0 29
Partial coverage 7 6 16 9 7 14 11 17 6 93
PEI
Total covered 12 9 17 13 8 8 4 9 1 81
Full coverage 5 5 7 6 3 4 1 3 0 34
Partial coverage 7 4 10 7 5 4 3 6 1 47
QC
Total covered 18 14 22 21 15 21 13 25 9 158
Full coverage 7 5 8 10 6 7 3 8 2 56
Partial coverage 11 9 14 11 9 14 10 17 7 102
SK
Total covered 13 10 16 12 10 11 8 20 4 104
Full coverage 4 3 5 6 4 3 1 2 1 29
Partial coverage 9 7 11 6 6 8 7 18 3 75

Data: Health Canada (2013); IMS Brogan (2013). Calculations: CHPI.