Life on hold – How Canada’s drug approval delays endanger patients: Nigel S.B. Rawson and John Adams
March 13, 2025
Canadians are trapped in a bureaucratic nightmare – waiting years for life-saving medicines that have already been approved and made available elsewhere.
Introduction
Health care across Canada is in crisis. In addition to known burdens of disease and therapies, Canada’s processes have become too bureaucratic and burdensome. With more barriers and layers of gatekeepers than any other country, Canadians are being forced to wait unacceptably long to access new and potentially lifesaving therapies.
There’s already significant shortages of doctors, nurses and hospital beds, several million Canadians have no family physician (Duong and Vogel 2023), emergency rooms are overrun with people who have nowhere else to turn for medical treatment (Kirkey 2024; Zafar 2024), and wait times to see a specialist and for surgery are far too long (Moir and Barua 2023) such that patients can die before seeing a health care provider.
Reasons include too many gatekeepers (well-paid administrators and politicians) poorly managing the “system” with perverse incentives, counterproductive billing codes, and insufficient health professionals where the rubber hits the road (Corbella 2022). An excessive number of gatekeepers negatively impacts the drug approval and pricing processes.
We are in a golden age of biotechnology and medicine. However, a key problem is our policies and practices get in the way. Increasingly, a drug prescribed by a physician who knows the patient and their condition is viewed by the insurance payer (public or private) as a suggestion to be second-guessed by prior authorizations and payment criteria, not a medical necessity. Medicines only work if patients can access and use them. Delays in access mean patients’ health and quality of life deteriorate and lives are lost prematurely. The time between a medicine’s development and patients’ ability to use it is a key metric. Four years can often elapse between the first government in the world paying for a new drug and when the first Canadian can get that drug via a government drug plan (CHPI 2024). This is deliberate rationing of access to treatment, which can be lethal to patients with aggressive conditions.
Properly prescribed and used, innovative medicines can cure or alleviate disease, slow, halt, or reverse the course of illnesses, and extend lives, providing a better quality of life and preventing the need for other more expensive medical services (Bobrovitz et al. 2018). However, instead of encouraging drug developers to launch these medicines in Canada, federal, provincial, and territorial governments have established gatekeeping processes using flawed evaluations of the benefits and costs of new drugs and controlling their prices. It is getting worse as more private payors wittingly or unwittingly borrow bad practices from governments and apply recommendations never intended to consider what is best to keep people healthy, working, and, as a result, paying taxes (Bailey 2024; Lepage 2024; Lepage and Eagan 2024). This situation plays a significant role in Canada’s lack of productivity
These flawed processes, in aggregate, can deter drug developers from bringing novel medicines to Canada (Rawson 2022). New medicines may be costly for drug budgets but can save money by preventing the need for more and more expensive health care services and maintaining worker productivity. Canada’s siloed health care gatekeepers and their masters fail to take a whole-of-society or even a whole-of-healthcare view for evaluating benefits of new medicines (Lau et al. 2024).
It’s important to understand how new medicines are approved and reviewed for coverage in government drug plans. There are five gatekeeping layers to get drugs to Canadians through government systems:
Submission to Health Canada for regulatory review before marketing a drug.
Submission for health technology assessment (HTA) by the institute national d’excellence en santé et services sociaux (INESSS) for the Quebec’s drug plans and Canada’s Drug Agency (CDA) for government drug plans in the rest of Canada.
Negotiations between drug developers and the pan-Canadian Pharmaceutical Alliance (pCPA), the federal, provincial, and territorial governments’ price-negotiating organization.
Negotiations between drug developers and individual government drug plans.
Assessment of whether a drug’s Canadian price is excessive compared with prices in a set of other countries by the federal tribunal called the Patented Medicine Prices Review Board’s (PMPRB).
No other country has so many layers of gatekeeping for biopharmaceutical health care.
Gatekeeper 1: Regulatory review by Health Canada
The first step towards launching a new medicine in Canada is to submit data about its benefit, safety, and manufacturing quality to Health Canada for approval to market the drug. If Health Canada grants priority status for a first-in-class drug for an unmet need, this step takes about six months. Otherwise, such evaluations take around a year (Rawson 2018).
New medicines are submitted to Health Canada typically about a year after submission to either the US Food and Drug Administration (FDA) or the European Medicines Agency (EMA), both of which are larger and better funded regulatory agencies than Canada’s. Both the FDA and EMA already analyze data submitted by drug developers, while Health Canada seems to repeat those reviews.
This initial delay could be due to several reasons, but two are particularly relevant. First, Canada’s population of 40 million is small when compared with the US population of over 330 million and the European Union’s almost 450 million. The other reason is barriers erected by Canadian governments that drug developers must overcome to get their medicines to Canadians.
Gatekeeper 2: Health technology assessment by Canada’s Drug Agency
The roots of Canada’s Drug Agency (CDA) extend back to 1989. It expanded in 2006 and became the Canadian Agency for Drugs and Technologies in Health. In 2024, the agency rebranded itself as CDA. Today, it is a large non-profit corporation with over 250 staff and a budget of $50 million in 2022–23 (latest statement available), with 83 per cent of its revenue coming from federal (81.5 per cent) and provincial (18.5 per cent) governments (KPMG 2023). Why federal taxpayers pay more than 80 per cent is worth asking, when CDA mostly serves provincial and territorial responsibilities for health care. This could be an item crying out for a cutback to help trim the federal deficit while respecting the primary responsibilities of provinces and territories for health care. They should pay more if they value its performance.
CDA does the work of and for governments but, despite its name, is not a government agency, which means freedom-of-information requests, independent ombudsperson appeals, and auditor-general performance reviews, let alone regular parliamentary scrutiny, are not available to examine its independence, transparency, or accountability (Rawson and Adams 2017).
The key role of CDA is to perform HTA reviews to try to evaluate the cost-effectiveness of new medicines and make recommendations about reimbursement to all government drug plans, except those in Quebec. HTA is a methodology – not a science (Hofmann 2013) – and, unfortunately, CDA HTAs are flawed in major ways. We count eight distinct defects in the function and performance of CDA.
The first flaw is that its evaluations are based on inadequate data because effectiveness is unavailable from premarketing clinical trials. Randomized clinical trials measure efficacy, which is the extent to which an intervention “produces a beneficial result under ideal conditions,” whereas effectiveness is the extent to which an intervention “when deployed in the field in routine circumstances, does what it is intended to do for a specified population” (Rawson 2001). HTAs are, therefore, predicting a drug’s benefit in regular clinical practice based on evidence from the experimental environment of premarketing clinical trials where patients carefully selected to have a precise diagnosis are vigilantly monitored to ensure the medicine is administered at the right dose at the correct time. In the real world, patients may not have the same diagnosis, not use the drug as directed, and aren’t supervised to the same extent.
A second limitation is the price used in CDA HTAs. Usually, it’s the drug’s list price, which is higher than the price negotiated by large purchasers, such as government drug plans. Consequently, no matter how sophisticated CDA analyses appear to be, they use inaccurate data to make predictions that affect whether patients should receive coverage by government drug plans.
A third questionable practice is that CDA HTAs are duplicating work done by Health Canada, which is especially concerning when CDA not only replicates the regulatory agency’s work but second-guesses Health Canada by questioning a drug’s clinical benefit.
The fourth area for error is about assumptions. Like most HTA agencies, CDA prefers cost-utility economic analyses, which use a metric known as quality-adjusted life-year (QALY) that attempts to include both quality and quantity of life lived in a single measure of disease burden. QALYs use a linear scale between zero representing death and one representing perfect health and are, therefore, a one-dimensional measure of an individual’s quality of health that, in reality, is a complex, multi-faceted and non-linear physical, psychological, and social state (Pettitt et al. 2016; Prieto and Sacristán 2003). The linear scale of QALYs is arbitrary and inconsistent with the real world and patient impact.
HTAs are based on modelling techniques requiring numerous assumptions. The use of QALYs adds a further layer of suppositions. Although experts have developed sophisticated methods to try to overcome these issues, they can never overcome problems caused by unrealistic or illogical assumptions and inadequate or inaccurate data. QALYs also fail to capture the social value of a medicine (Rowen et al. 2017) and are a deficient and inequitable measure of health quality for assessing the value of treatments for people with disabilities, chronic conditions, or rare disorders (National Council on Disability 2019; Richter et al. 2018).
A fifth flaw is the assumed value of a QALY. CDA compares QALYs with a willingness-to-pay threshold value to assess a “cost-effectiveness ratio.” In the past, the threshold for a QALY wasn’t explicitly stated, although commonly thought to be $50,000 but, in some cases such as drugs for cancer or rare disorders, it was $100,000 to $150,000 (Binder et al. 2022; Fashami et al. 2024). However, in the last five years, CDA has regularly used a willingness-to-pay threshold of $50,000 per QALY to assess cost-effectiveness, regardless of the type of medicine. The $50,000 threshold was first proposed in 1990 (Grosse 2008) and never adjusted for inflation, economic growth, severity or rarity of disease or the significant increase in research, production, and regulatory costs of innovative medicines in the last four decades.
The $50,000 threshold doesn’t work well for modern medicines, given increases in longevity and population health, and, consequently, HTA reports frequently include recommendations for price reductions of 70 per cent or higher to achieve $50,000 per QALY (Rawson 2021; Balijepalli et al. 2024). Calling for 99 per cent reductions is not unheard of, but the reality is CDA’s use of a $50,000 per QALY threshold dating from 1990 means its gatekeeping is not fit for purpose. Other approaches, such as the Standard of Living Valuation that considers the value of socioeconomic conditions in addition to health benefits (Pyenson et al. 2024), should be considered to replace current methodology.
The sixth area of concern is the tunnel vision of focusing predominantly on one type of evidence. The CDA version of HTA prioritizes evidence from pivotal trials – randomized, placebo-controlled, phase 3 clinical trials – in its HTAs; earlier trials and other study types are given less weight. Randomized phase 3 trials are not always possible for rare disorders or can be unethical if an earlier study demonstrates a drug has a beneficial impact on life-threatening or debilitating diseases. CDA has a documented pattern of less flexibility than HTA agencies in other countries when considering early trials, other types of studies, and real-world evidence.
Flaw seven is that, for any patient waiting desperately for a drug available outside Canada, HTAs take precious time to complete, despite CDA’s procedures manual stating its “typical timeline” for reviews is “≤180 calendar days” (CDA 2024). Few reviews achieve this performance metric (just 52 or 9.2 per cent out of 567 published in the past nine years with mention of the metric) and the percentage has decreased over the period, but most HTA reports state CDA achieved its “performance metric” (Figure 1). The CDA version of HTA reporting is self-serving. CDA reports don’t state what the metric is, but we assume it’s 180 days. The percentages shown in Figure 1 are consistent for both oncology and non-oncology medicines (Rawson and Stewart 2024). CDA regularly fails to meet its own standard for timely reports.
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