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How to cut Canada’s approval time for new drugs

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VANCOUVER — New medicines are a central component of modern medical care, treating illness effectively, providing more comfortable treatment regimes, extending life and reducing disability, and sometimes offering new treatment options where none previously existed. These benefits, however, come with the potential for harm, which is why governments around the world regulate access to new medicines.

Unfortunately for Canadians, the federal government takes an approach that is slower than others, unnecessarily costly for taxpayers, and is ultimately of questionable benefit to Canadians. Canadian approvals for market access to new drugs take longer than similar approvals in both Europe (under the European Medicines Agency) and the U.S. (under the FDA). Specifically, the median approval time was longer in Canada than in the other jurisdictions in four of the past five years, with median approval times differing by an average of 63 days and 49 days respectively over that period.

In fact, this is likely an underestimate of the drug approval lag Canadians endure. Drugs may not be submitted to Health Canada for approval at the same time as they are submitted to regulatory agencies in Europe and the U.S., or even in the same year. A recent study of access to new cancer drugs found that drugs were submitted to Canadian regulators for approval much later than they were submitted to U.S. or European regulators. The data used in that study show a median difference of 119 and 96 days respectively and with approximately one quarter of submissions in both cases coming more than six months later.

Why does this matter? Because of the benefits mentioned above and because new drugs can reduce (yes, reduce) health spending.

Numerous studies show that pharmaceutical spending and use of pharmaceuticals generally are related to reduced mortality, increased longevity, and decreased disability, none of which should be surprising to survivors of critical illness or those whose chronic or potentially fatal condition is being controlled through prescriptions.

Prof. Frank Lichtenberg of Columbia University took this one step further and found that using newer drugs rather than older ones increased prescription costs by $18 per patient in the U.S. but reduced non-drug health spending (primarily hospital and physician spending) by $129. Put differently, the benefits of new drugs come at increased cost but ultimately may be a more cost effective approach than sticking with older (and less expensive) drugs.

But would faster approval of new drugs expose us to greater risk? Perhaps.

For example, there can be little doubt that later approvals in Canada afford regulators the time to observe post-market experiences in other nations before Canadians are permitted access to new drugs. This may allow regulators to deny market access to those drugs that are found to be associated with serious negative events.

Good drug policy is all about balance. In this case, balancing the rights of Canadians to access (and benefit) from new medicines against the potential for harm associated with them. There is a straightforward solution Canada might pursue that will strike a better balance between these competing factors than the one we have today.

Canada could adopt a system where U.S. and European drug approvals were considered sufficient for market access in Canada rather than the current approach of mandatory Health Canada approval. This would both speed access to new drugs in Canada (and reduce the costs of compliance with Canadian regulations), while maintaining a strict regime for drug approvals undertaken by well-resourced agencies.

Such a reform could free up considerable resources at Health Canada. Some of these resources could be put towards funding and supporting better communication of the risks associated with certain drugs so that physicians and patients can make more informed decisions about their use of drugs and about the risk/benefit trade-off they are facing when choosing a particular treatment option. This is particularly important when more and more complex products are being approved. Critically, this leaves more control of the risk/benefit trade-off in the hands of those directly exposed to it rather than to risk-averse regulators who have strong incentives to minimize risk at the expense of lost benefit.

Canada unnecessarily duplicates approval processes undertaken in the U.S. and Europe. A smarter approach to drug regulation would be to accept the decisions of these agencies (who review new medicines in a more timely fashion and are ultimately responsible for the safety of much larger populations) while saving money and/or providing more and better information to consumers. The end result would be better and likely safer and more informed access to new medical advances for Canadians.


Nadeem Esmail is the director of health policy research at the Fraser Institute.

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