The Ontario Ministry of Health and Long-Term Care (the Ministry) has amended Regulations made under the Ontario Drug Benefit Act (ODBA) and the Ontario Drug Interchangeability and Dispensing Fee Act (DIDFA). The new Regulations are substantially similar to those originally proposed (as we reported). The intended effect of the amendments is to reduce technical requirements for listing a product on the Ontario formulary and align policies with industry standards and other provinces.
Key changes to the Regulations include:
- Remove the requirement for the Drug Notification Form (DNF) from formulary drug submissions. A DNF is a form submitted to Health Canada as proof of a “first sale” of the drug and indicates that the manufacturer has supply of the drug. Currently, in Ontario, the absence of this form is one of the most frequent reasons why a submission for listing is deemed incomplete. The Ministry advises that the removal of the DNF requirement will ease burden on industry and enable earlier formulary submissions. This change comes into force January 1, 2020.
- Reduce requirements for biosimilar drug submissions. Health Canada has an approval method for biosimilar drug products that assesses whether there are clinically meaningful differences between the biosimilar product and the reference biologic product. The amendments are intended to allow the Ministry to rely upon Health Canada’s approval, and eliminate the requirement that the manufacturer submit clinical evidence of efficacy and safety, along with evidence of the pharmacoeconomic benefit of the product. According to the Ministry, eliminating these submission requirements will enable biosimilar products to be funded more quickly. This change comes into force January 1, 2020.
- Permit generic drug price adjustments. Pricing of interchangeable generic drugs changes depending on the number of market competitors with the lowest price typically achieved with three or more generics in the market. The changes are intended to reduce the regulatory burden on the generic industry since manufacturers would no longer need to apply for price adjustments when the number of competitors change. This change is deemed to have come into force April 1, 2018.
- Streamline drug submission requirements for generic line extension. The changes simplify the submission requirements if Health Canada has approved a generic line extension for sale in Canada (for example, a dosage strength or formulation that is different from what the brand is offering). Under the Regulations, manufacturers will no longer be required to submit clinical evidence of the product’s efficacy and safety, or evidence demonstrating the product’s pharmacoeconomic benefit to have their line extensions listed on the Ontario Formulary. This change comes into force January 1, 2020.
- Revoke provisions authorizing Ontario to conduct price review of certain single source generic products. This pricing assessment is already conducted through the current pan-Canadian generic pricing framework. The Ministry characterizes this change as a “housekeeping change that removes out-dated clauses”. This change comes into force January 1, 2020.
- Permit short-term funding by exempting certain submission requirements in the event of drug shortages. Where there is a shortage of a listed drug product and it is in the public’s interest, a manufacturer will no longer be required to submit to the Ministry evidence of a Health Canada approval for sale, clinical evidence of the product’s efficacy and safety, or evidence of the product’s pharmacoeconomic benefit in order to be listed. Following consultation, the Regulations were also amended so that manufacturers will no longer be required to submit evidence of ability to supply the drug product at the proposed drug benefit price. This provision would only apply to drug products that have the same or similar active ingredients or therapeutic uses as the drug product subject to the shortage. This change is deemed to have come into force November 1, 2019.
- Reduce the Ministry’s payments to pharmacies. The new Regulations will reduce payments made by the Ministry to pharmacies for dispensing drug benefits for Ontario Drug Benefit program recipients, other than long-term care home residents. The Ministry will now deduct a percentage from the sum of the dispensing fee and mark-up paid for all drug claims. The reconciliation adjustment is two-tiered, with adjustments based on the cost of the drug: Tier 1: Maximum of 16% for drug costs equal to or over $1,000; and Tier 2: Maximum of 4% for drug cost under $1,000. The Regulations implementing this change can be accessed here.