Expanded coverage for hepatitis C drugs

It was recently announced that the pan-Canadian Pharmaceutical Alliance (pCPA) had reached an agreement with several drug manufacturers regarding pricing arrangements for six high cost prescription drugs that treat hepatitis C. The pCPA negotiates drug prices on behalf of government health care programs and has successfully reduced the cost of many generic drugs over the past several years. Up to this point, these hepatitis C drugs have been approved through each province’s special access program, which allows provincial funding for drugs not covered under the regular formulary based on certain criteria. Coverage is currently limited to individuals with certain genotypes or severities of hepatitis C.

The Ontario and BC governments followed up on the agreement by announcing that they are expanding provincial coverage for these six specific hepatitis C drugs. Ontario confirmed that effective February 28, 2017, several hepatitis C drugs would be added to the Ontario Drug Benefit (ODB) Program for eligible ODB recipients as limited use benefits. In BC, the PharmaCare program expanded its criteria in March 2017 to provide coverage to more patients living with hepatitis C. Starting in 2018, BC will further expand coverage for any resident living with chronic hepatitis C, regardless of the type or severity of their disease.

BC and Ontario led the negotiations with the drug manufacturers on behalf of the pCPA and were the first two provinces to announce changes to coverage. In the 2017 provincial budget released in March, Saskatchewan announced a similar expansion of coverage effective April 1, 2017. It remains unclear if and when additional provinces and territories will follow suit.

In Quebec, private group insurance plans must cover hepatitis drugs under specific eligibility conditions since the end of 2015. This has already impacted the cost of private group insurance and pooling charges. The Quebec government has mentioned its intention to relax those eligibility conditions progressively in order to reduce the impact on private group insurance plans.

There are estimates that as many as 250,000 Canadians are infected with hepatitis C. Recent advancements in hepatitis C therapies have produced drug success rates of 95% or greater, with fewer side effects than previous options. However these advancements come at a cost, typically ranging from $45,000 to $100,000 per person. Following the release of these new hepatitis C drugs in recent years, many plan sponsors have experienced a significant increase in drug plan costs as well as upward pressure on the premiums required by insurers for pooling and stop loss protection.


Conclusion

The expansion of coverage for these drugs under several provincial health care programs is favourable news for plan sponsors, though it does not eliminate the risk or impact of claims hitting group plans up to the stop loss limit. In provinces other than Ontario, BC and Saskatchewan, several of these hepatitis C drugs remain available through provincial health care special access programs. Changes regarding prescription drugs occur frequently, underscoring the need for plan sponsors to regularly review their plan.


News & Views - April 2017 (PDF)