Since 1990, spending on prescription overtook spending on doctors, and is only second behind spending on hospitals
2007, prescription bill was 22.5 Billion, increasing at a rate of 7-10%
How much consumers spend is determined by policy regarding their approval and monitoring, industry policy, intellectual rights and doctor’s knowledge.
The Drug Regulatory System
• Long relationship between pharma companies and Canadian government • The Canadian government’s Therapeutic Products Directorate (TPD) enforces regulations
of drug safety, quality, and efficacy, but does not have the resources to run the clinical trials. • TPD has a high degree of concentrated power but low degree of autonomy. • The association Rx&D represents nearly all the multinational drug companies operating in Canada. It has the authority to act and make agreements on behalf of its members. • Some of that is authority is relinquished to the Rx&D under a relationship called clientele pluralist – Where Rx&D operates in a way that is in broad agreement with TPD. • This leads to conflicts on what the prime function of drug regulatory body should be. • Pharma industry insists that the main function is to facilitate the development of new drugs and approve them as fast as possible. • Consumer and public health groups insist that it is to ensure a high standard of effectiveness and safety.
TPD: Changing Priorities?
• TPD should technically be on the side of the consumer groups. • However recent years, 1/3 of its funding now comes from the private sector. • Its recent Business Transformation Strategy has put a focus not only on safety but also
timely approval of bringing drugs to market. • Its focus on creating a “smart regulation” has placed emphasis on being business friendly. • At the same time, it is choosing to use a tactic of risk management, weighing pro’s and
con’s rather than being precautionary. • This means that unless the effect is serious, drugs that would not have passed under the
old criteria will now get through.
Timeliness of Drug Approvals
• TPD is devoting significant resources toward speeding up the approval process. • In 2003, $190Million was budgeted to speed up approval and clear the backlog of drugs
waiting to be approved. • The biggest benefactors are brand name drug companies who stand to make millions
from earlier approvals. • At the same time since TPD’s funding is connected to drug company revenue, it is not in
its own best interest to approve drugs faster • This is at the possible expense of other responsibilities such as drug safety monitoring.