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© 2017 Joule Inc. or its licensors CMAJ | FEBRUARY 27, 2017 | VOLUME 189 | ISSUE 8 E295 U niversal access to safe, affordable and appropriately prescribed medicines is an important goal of national health care systems. 1 Canadians benefit from universal public coverage of physicians’ services and hospital care; how ­ ever, an estimated 20% of Canadians are uninsured or under­ insured for the cost of prescription drugs used outside hospi­ tals. 2,3 This makes Canada an outlier as the only advanced economy with a universal health care system that excludes uni­ versal coverage of prescription drugs. Although the Canada Health Act ensures universal coverage of medicines used in hospitals, Canada has no national standards for the coverage of prescription drugs used in the community. The federal government provides drug coverage for select populations that account for 2% of prescription drug expenditures in the coun­ try. 4 Provincial and territorial governments offer various public drug plans for people of specific ages, incomes or health statuses that finance between 25% and 41% of prescription drug expendi­ tures in their jurisdictions. 4 Private drug plans — typically obtained through work­related extended health benefits — account for 35% of prescription drug expenditures in Canada. 4 Patients finance 22% of total Canadian prescription drug expenditures out of pocket. 4 Canada’s patchwork of private and public financing of medi­ cines creates clinical and economic problems. About 10% of Canadians report that they cannot afford to take medications as prescribed because of out­of­pocket costs. 5 Such access barriers have been shown to result in worse health outcomes and in­ creased costs elsewhere in the health care system. 6–9 The multi­ payer system for medicines also increases administration costs, creates silo budgeting within the health system and reduces RESEARCH Estimated effects of adding universal public coverage of an essential medicines list to existing public drug plans in Canada Steven G. Morgan PhD, Winny Li MSc, Brandon Yau BSc, Nav Persaud MD MSc n Cite as: CMAJ 2017 February 27;189:E295­302. doi: 10.1503/cmaj.161082 CMAJ Podcasts: author interview at https://soundcloud.com/cmajpodcasts/161082­res See related article at www.cmajopen.ca/content/5/1/E137 ABSTRACT BACKGROUND: Canada’s universal health care system does not include uni­ versal coverage of prescription drugs.

We sought to estimate the effects of adding universal public coverage of an essential medicines list to existing pub­ lic drug plans in Canada. METHODS: We used administrative and market research data to estimate the 2015 shares of the volume and cost of prescriptions filled in the community setting that were for 117 drugs on a model list of essential medicines for Canada. We compared prices of these essential medicines in Canada with prices in the United States, Sweden and New Zealand. We estimated the cost of adding universal public drug coverage of these essential medicines based on anticipated effects on medication use and pricing. RESULTS: The 117 essential medicines on the model list accounted for 44% of  all prescriptions and 30% of total prescription drug expenditures in 2015.

Average prices of generic essential medicines were 47% lower in the US, 60% lower in Sweden and 84% lower in  New Zealand; brand ­name drugs were priced 43% lower in the US. Esti ­ mated savings from universal public coverage of these essential medicines was $4.27  billion per year (range $2.72  billion to $5.83  billion; 28% reduction) for patients and private drug plan sponsors, at an incremental government cost of $1.23 billion per year (range $373  million to $1.98 bil­ lion; 11% reduction). INTERPRETATION: Our analysis showed that adding universal public coverage of essential medicines to the existing pub­ lic drug plans in Canada could address most of Canadians’ pharmaceutical needs and save billions of dollars annu­ ally. Doing so may be a pragmatic step forward while more comprehensive pharmacare reforms are planned. E296 CMAJ | FEBRUARY 27, 2017 | VOLUME 189 | ISSUE 8 Cana da’s purchasing power in the global pharmaceutical mar­ ket. 10 As a result, pharmaceutical prices and total per capita ex­ penditures on pharmaceuticals are higher in Canada than in de­ veloped countries with comparable health care systems. 10–13 Universal public coverage of prescription drugs was recom­ mended by the 1964 Royal Commission on Health Services (Hall Commission), the 1997 National Forum on Health and the 2002 Royal Commission on the Future of Health Care in Canada (Romanow Commission). 14 These commissions, and more recent bodies of evi­ dence, suggest that implementing universal public drug coverage that is both comprehensive and evidence based would be the best way to ensure the accessibility, affordability and appropriateness of medicine use in Canada. 15 But a variety of factors have stalled prog­ ress toward such universal pharmacare. 16 Practical considerations are among obstacles to reform. Imple­ menting a comprehensive pharmacare program involves a number of logistical challenges: a national, evidence­based formulary needs to be delineated; prices and supply contracts need to be negotiated; and a greater share of total pharmaceutical expenditure needs to flow through the public program. Although these challenges are not insurmountable, it may be prudent to “start small” by adding uni­ versal public coverage of a carefully selected list of essential medica­ tions to the existing complement of public drug plans in Canada. A similar step toward comprehensive drug coverage for all Canadians was recommended by the 2002 Romanow Commission and the 2016 Citizens’ Reference Panel on Pharmacare in Canada. 17,18 The World Health Organization (WHO) maintains a model list of essential medicines that is meant to be adapted by countries to meet the medicine needs of their populations. 19,20 Medicines on resulting national lists are ones governments commit to mak­ ing accessible because of their importance to patient and public health. 21,22 International evidence suggests that encouraging access to drugs on essential medicine lists can improve patient outcomes and lower costs. 22–28 We sought to estimate the 2015 volume and cost of prescrip­ tions filled in Canada for medicines on, or similar to medicines on, a Canadian adaptation of the World Health Organization’s model list of essential medicines. We also sought to compare the prices of these essential medicines in Canada with their prices within single­payer systems for pharmaceutical coverage that publish data on drug pricing: the US Department of Veterans Affairs, and the national drug coverage systems of Sweden and New Zealand. Finally, we sought to estimate the financial impli­ cations of adding universal public drug coverage of the essential medicines on the model list to the existing complement of public drug plans in Canada. Methods This is a secondary analysis of administrative and market research databases pertaining to the volume and costs of pre­ scriptions for the calendar year 2015.

Selection and classification of medicines The essential medicines list used in our study is the CLEAN Meds list, an adaptation of the WHO model list of essential medicines for primary health care in Canada. 29 Our analysis focused on 117 of the CLEAN Meds drugs (hereafter “the essential medicines”) that are available and sold as prescription­only medicines in Canada (Appendix 1, available at www.cmaj.ca/lookup/suppl/ doi:10.1503/cmaj.161082/­/DC1). Although predominantly target­ ing primary health care needs, some medicines on the list are often prescribed by specialists (e.g., treatments for hepatitis and HIV infection, and a biologic drug for inflammatory conditions). We used WHO’s Anatomic Therapeutic Chemical (ATC) Classifi­ cation System to assign medicines to mutually exclusive groups. 30 This allowed us to identify other drugs for which the essential medi­ cines may be suitable substitutes for some patients. We used the chemical subgroups of the ATC system to define relatively close substitutes (e.g., A02BC = “proton pump inhibitors”) and the phar­ macologic/therapeutic subclasses of the ATC system to define broader ranges of substitutes (e.g., A02B = “drugs for peptic ulcer and gastro­oesophageal reflux disease”). We further grouped medi­ cines into 47 broad therapeutic categories for reporting purposes.

31 Data sources We used data from multiple sources, each described in greater detail in Appendix 2 (available at www.cmaj.ca/lookup/suppl/ doi:10.1503/cmaj.161082/­ /DC1). From IMS Health, we obtained product­level data describing the number of and total expendi­ ture on all prescriptions dispensed at retail pharmacies in each province during 2015. From the National Prescription Drug Utili­ zation Information System database of the Canadian Institute for Health Information (CIHI), we obtained 2015 data on the number of and total expenditure on prescriptions that were paid, in whole or in part, by public drug plans in all provinces except Quebec.

Because the IMS Health data included Quebec but the CIHI data did not, we estimated the public shares of prescription costs for Quebec based on average public shares for the same drug types in all other provinces combined. This may overstate the public proportion of expenditures in Quebec by 7% (Appendix 2). Using methods described in Appendix 2, we obtained prices for the most common dosage forms of each generic drug on the essential medicines list from public formularies in Canada, the United States (US Department of Veterans Affairs), Sweden and New Zealand. Because prices of brand­name drugs listed on national formularies do not include confidential manufacturers’ rebates, we obtained from the US Department of Veterans Affairs a weighted average of net prices of essential medicines available only from brand­name manufacturers in Canada. We converted foreign prices for generic and brand­name drugs to Canadian dollars using 2 methods: exchange rates and gross domestic product (GDP) purchasing power parities.

Statistical analysis To measure the baseline volume of prescriptions used, we com­ puted the total number and cost of prescriptions for the essential medicines and all other medicines in 2015. To gauge the poten­ tial scope of clinical needs that the essential medicines may be suitable for, we calculated the number and cost of prescriptions in the same ATC chemical subgroups and the same ATC pharma­ cologic subclasses as 1 or more of the essential medicines.

RESEARCH CMAJ | FEBRUARY 27, 2017 | VOLUME 189 | ISSUE 8 E297 We used economic modelling to estimate the total cost of prescriptions (stratified by province, therapeutic category and source of financing) under a scenario wherein universal public coverage of the essential medicines is added to the existing com­ plement of public drug plans in Canada. The models were based on economic frameworks developed for analyses of the determi­ nants of prescription drug expenditure as a function of the vol­ ume of purchases made, products selected and prices paid for selected products. 32,33 The economic models involved a number of pricing and utili­ zation parameters that we chose on the basis of Canadian and international evidence, as described in Appendix 2 and summa­ rized in Table 1. We report results for scenarios with all model parameters set to base­case scenario values, all parameters set Table 1: Summary of parameters chosen for the economic models of the cost of adding universal public coverage of an essential medicines list to the existing complement of public drug plans in Canada* Parameter ExplanationBase-case scenarioBest-case scenarioWorst-case scenario Direct change in the use of the essential medicines Increased accessibility of essential medicines to Canadians who are currently uninsured or underinsured 34 30% increase in utilization 12% increase in utilization39% increase in utilization Indirect change in the use of the essential medicines Expected product substitutions among patients currently filling prescriptions for drugs similar to the essential medicines 35 Average of 37% of such patients switch Average of 66% of such patients switchAverage of 7% of such patients switch Changes in prices of generic versions of the essential medicines Expected reductions achieved with tendering and other generic pricing tools, gauged on the basis of prices in comparable single ­payer systems: United States (US Department of Veterans Affairs), Sweden and New Zealand 36,37 Median comparator prices Best comparator pricesWorst comparator prices Changes in net prices of brand­name essential medicines Expected price reductions achieved with universal application of negotiated rebates, gauged on the basis of published estimates of prices and rebates, and average net price information for the US Department of Veterans Affairs 38–40 15% lower net prices 20% lower net prices10% lower net prices Changes in prices of drugs not on the essential medicines list Expected changes in the price of drugs not on the essential medicines list No change No changeNo change Standard co ­payment per prescription for the essential medicines Expected co ­payment for standard beneficiaries, set as a maximum dispensing fee that could be lowered if pharmacies competed on price to patient $11 or less, depending on pharmacy $11 or less, depending on pharmacy$11 or less, depending on pharmacy Percentage of prescriptions filled by patients exempted from co ­payments for essential medicines Expected co ­payment exemptions for vulnerable populations (e.g., older people, low­income people, children) as a share of all prescriptions filled for the essential medicines 30% 30%30% Other changes in existing public drug plans in Canada Expected changes in public coverage of drugs not on the essential medicines list None NoneNone Patient savings from shopping at pharmacies with lower dispensing fees Expected patient savings arising from pharmacies competing for business by lowering dispensing fees Not included in estimates Not included in estimatesNot included in estimates Indirect reduction in government cost of extended health benefits for public sector employees Expected government savings from reduced cost of private insurance for public sector employees, which would be equal to about 20% of total private sector savings 41 Not included as government savings in estimates Not included as government savings in estimatesNot included as government savings in estimates Health care system savings from increased adherence to essential medications Expected savings to the broader health care system resulting from increased adherence to essential medicines 6–9 Not included in estimates Not included in estimatesNot included in estimates *Complete details concerning the rationale and data sources for model pa\ rameters are provided in Appendix 2 (available at www.cmaj.ca/lookup/suppl/doi:10.1503/cmaj.161082/­/DC1).

RESEARCH E298 CMAJ | FEBRUARY 27, 2017 | VOLUME 189 | ISSUE 8 to best­case scenario values and all parameters set to worst­case scenario values.

Results Baseline volume and cost of prescriptions In 2015, Canadians filled an estimated 568.4 million prescriptions at retail pharmacies, at a total cost of $26.2 billion (Table 2). A to­ tal of 377.5 million of the prescriptions were publicly paid, at a total cost of $10.8 billion. The essential medicines accounted for 44% of all prescriptions and 30% of the total cost. They ac­ counted for a slightly higher share (50%) of publicly paid pre­ scriptions and an approximately equal share (31%) of the total expenditure on publicly paid prescriptions.

The essential medicines accounted for 50% or more of pre­ scriptions from 15 broad therapeutic categories, including high­prescription­volume drug classes (e.g., drugs for chronic obstructive pulmonary disease and asthma, drugs for ulcers and gastroesophageal reflux disease, noninsulin diabetes medi­ cations and antibiotics). (Results by drug category are available in Appendix 1.) There were no essential medicines listed for 7  treatment categories: hepatitis C, bladder control, infertility, macular degeneration and receptor­positive cancers (endo­ crine therapies).

Greater shares of prescription volumes and expenditures were accounted for by the essential medicines combined with drugs that were either chemically or pharmacologically similar to them.

Medicines from ATC chemical subclasses that had 1 or more of the essential medicines within them accounted for 77% of total pre­ scriptions filled and 63% of total prescription expenditures. Medi­ cines from ATC pharmacologic subclasses with 1 or more of the essential medicines within them accounted for 90% of total pre­ scriptions filled and 83% of total prescription expenditures. Foreign prices of essential medicines Table 3 summarizes our comparison of the relative price of generic versions of the essential medicines in Canada and in comparable countries. We were able to find comparator generic Table 2: Shares of prescription volume and expenditure accounted for by the essential medicines and other drugs in the same chemical and pharmacologic subgroups in 2015, by province* Variable Province; share of prescription volume or expenditure, %† All BCAB SKMB ON QCNBNSPEI NL Total prescriptions, millions 568.449.941.7 14.915.2 186.8 225.911.412.2 1.98.5 Essential medicines 444843 4344 44 434443 47 43 Essential medicines and other drugs in same chemical subgroups 77 7774 7676 76 797575 78 76 Essential medicines and other drugs in same pharmacologic subgroups 90 8988 8889 91 918888 90 89 Publicly paid prescriptions, millions 377.531.814.0 7.07.2147.9 155.6 5.24.3 0.9 3.7 Essential medicines 505350 4749 52 485048 55 46 Essential medicines and other drugs in same chemical subgroups 83 8278 7980 82 867879 84 78 Essential medicines and other drugs in same pharmacologic subgroups 94 9488 9192 94 969090 93 89 Total expenditure, $ billions 26.22.62.6 0.70.8 10.1 7.40.70.8 0.1 0.4 Essential medicines 303331 3531 28 293232 36 32 Essential medicines and other drugs in same chemical subgroups 63 6563 7066 60 646567 72 68 Essential medicines and other drugs in same pharmacologic subgroups 83 8783 8785 82 828286 86 84 Public expenditure, $ billions 10.81.00.8 0.30.3 4.8 3.00.20.2 0.0 0.1 Essential medicines 313331 3428 30 303635 46 35 Essential medicines and other drugs in same chemical subgroups 61 6561 7065 59 626669 80 70 Essential medicines and other drugs in same pharmacologic subgroups 82 9178 8784 81 828286 89 83 Note: AB = Alberta, BC = British Columbia, MB = Manitoba, NB = New Brunswick, NL = Newfoundland and Labrador, NS = Nova Scotia, ON = Ontario, PEI = Prince Edward Island, QC = Quebec, SK = Saskatchewan.

*Calculations are based on data from IMS Health and the National Prescription Drug Utilization Information System database of the Canadian Institute for Health Information (see Appendix 2 for details, available at www.cmaj.ca/lookup/suppl/doi:10.1503/cmaj.161082/­/DC1).

†Unless stated otherwise.

RESEARCH CMAJ | FEBRUARY 27, 2017 | VOLUME 189 | ISSUE 8 E299 prices for matching dosage forms of 63 of the essential medicines (Appendix 3, available at www.cmaj.ca/lookup/suppl/doi:10 .1503/cmaj.161082/­/DC1). Using 5­year average exchange rates to convert currencies, and weighting products according to Canadian sales volumes, we found that generic versions of the essential medicines were priced 47% lower in the US, 60% lower in Sweden and 84% lower in New Zealand. Results were similar when we used GDP purchasing power parity to convert curren­ cies: 53% lower in the US, 56% lower in Sweden and 84% lower in New Zealand. Several high­volume medicines (including atorva­ statin, pantoprazole, amlodipine, amoxicillin and clopidogrel) were priced at least 70% below Canadian prices in 2 or more comparator countries (Appendix 3). From the US Department of Veterans Affairs, we obtained a weighted­average of relative prices for 16 brand­name drugs that accounted for 91% of Canadian expenditures on all of the essential medicines available only from brand­name manufacturers in Can­ ada. Net of manufacturer rebates, brand­name drugs in the US were priced 43% below Canadian list prices using exchange rate conversions and 49% below Canadian list prices using purchasing power parities. We nevertheless used more conservative estimates of price changes in our economic models (Table 1 and Appendix 2). Cost of universal coverage of the essential medicines For Canada and each province separately, Table 4 lists the esti­ mated change in total (private and public) expenditure on all prescriptions filled in retail pharmacies under our scenarios for adding universal public coverage of the essential medicines to the existing complement of public drug plans in Canada.

We estimated that the total expenditure on prescription drugs in Canada would fall by $3.04 billion (range $743 million to $5.46  billion; 12% reduction) under such an expansion of public Table 3: Expenditure-weighted averages of the relative price of generic versions of the essential medicines in Canada and specified comparator countries, May–July 2016 Variable United StatesSwedenNew Zealand Total no. of essential medicines with 1 or more generic equivalent in Canada and comparator country 55 2951 Total expenditure on prescriptions for brand­name and generic versions of essential medicines with 1 or more generic equivalent in Canada and comparator country, Can$ billions 2.98 2.513.22 Expenditure ­weighted average relative price of generic versions of essential medicines, comparator country relative to Canada, % Using 5­year average exchange rates to convert currencies 534016 Using GDP purchasing power parities to convert currencies 474416 Note: GDP = gross domestic product.

Table 4: Estimated change in total (private and public) expenditure on all prescriptions filled in retail pharmacies with the addition of universal public coverage of essential medicines on model list, by province Province Population in 2015, millions Actual expenditure in 2015, $ millions Estimated change in expenditure with addition of universal public coverage of essential medicines, $ millions (%) All model parameters set to base-case scenario values All model parameters set to best-case scenario values All model parameters set to worst-case scenario values All 35.726 204 –3043 (–12) –5458 (–21) –743 (–3) British Columbia 4.72649 –320 (–12) –562 (–21) –93 (–4) Alberta 4.22580 –238 (–9) –456 (–18) –35 (–1) Saskatchewan 1.1728 –75 (–10) –134 (–18) –20 (–3) Manitoba 1.3775 –90 (–12) –162 (–21) –22 (–3) Ontario 13.810 148 –1282 (–13) –2238 (–22) –359 (–4) Quebec 8.37364 –804 (–11) –1482 (–20) –158 (–2) New Brunswick 0.8662 –84 (–13) –141 (–21) –30 (–4) Nova Scotia 0.9762 –87 (–11) –153 (–20) –25 (–3) Prince Edward Island 0.296–12 (–12) –20 (–21) –4 (–4) Newfoundland and Labrador 0.5440 –47 (–11) –86 (–19) –10 (–2) RESEARCH E300 CMAJ | FEBRUARY 27, 2017 | VOLUME 189 | ISSUE 8 coverage. The percentage reduction in total expenditure was about equal across the provinces: ranging in the base scenario from a 9% reduction in Alberta to a 13% reduction in Ontario and New Brunswick. All economic scenarios included a total of more than $6  billion in pharmacy dispensing fees, equivalent to more than $210 000 per pharmacist practising in the community set­ ting in Canada. 42 For Canada as a whole, Table 5 summarizes our estimates of the change in public and private expenditures on all prescrip­ tions filled in retail pharmacies under our scenarios with the addition of universal public coverage of the essential medicines.

We estimated that the incremental government cost of adding universal public coverage of the essential medicines would be $1.23  billion per year (range $373 million to $1.98  billion; 11% reduction). The incremental private sector savings from such coverage was estimated at $4.27 billion per year (range $2.72 bil­ lion to $5.83 billion; 28% reduction). Total public expenditure on the essential medicines was estimated at $6.14  billion (range $5.6 billion to $6.6 billion); total public expenditure on medicines not on the essential medicines list, yet currently covered under existing public drug plans, was estimated at $5.85  billion (range $5.53 billion to $6.13 billion). Almost half of the estimated total national savings from add­ ing universal public coverage of the essential medicines ($1.50  billion) came from 7 therapeutic categories of medicine commonly prescribed in primary care: acid­reducing drugs, cholesterol medicines, antihypertensives, antipsychotics, anti­ biotics, antidepressants, and gabapentin and related drugs (Appendix 1). In contrast, about half ($628  million) of the incre­ mental cost to government of covering the essential medicines stemmed from increased public expenditure on just 1 drug:

adalimumab (Humira). Interpretation We found that nearly half (44%) of all prescriptions filled at re­ tail pharmacies in Canada in 2015 were for 117 drugs on a model essential medicines list for Canada (the CLEAN Meds list 29). An additional 33% of prescriptions filled were for drugs from the same chemical subclasses as 1 or more medicine from the essential medicines list. We estimated that adding universal public coverage of the essential medicines to the ex­ isting complement of public drug plans in Canada would save patients and private drug plan sponsors $4.27 billion per year (range $2.72 to $5.83  billion; 28% reduction). The incremental government cost of adding such coverage was estimated at $1.23  billion per year (range $373  million to $1.98 billion; 11% reduction). These estimates do not include indirect govern­ ment savings from reduced cost of private drug coverage for public sector employees, patient savings from shopping at pharmacies with low dispensing fees, or reduced demands on  the health system stemming from increased adherence to essential therapies.

Our modelling produced financial results similar to those found in the actual implementation of a limited formulary in Sweden. Adherence to the Swedish “Wise List” in Stockholm pri­ mary care sites saved 28% annually (€10 million or Can$14.5 mil­ lion). 43 If our economic models were set up to exclude the cost impact of increases in utilization resulting from insuring previ­ ously under­ and uninsured people (which was not a factor under Sweden’s universal system of drug coverage), they would pro­ duce estimated net savings of 23% ($3.7 billion) within the drug classes directly affected by the essential medicines list modelled for Canada. Our findings are also consistent with a previous study that estimated a comprehensive public drug plan could reduce total annual pharmaceutical expenditure in Canada by $7.3 billion using data from the 2012/13 fiscal year. 41 If our results were scaled to include savings for drugs not on the essential medi­ cines list, the base­case scenario estimates of total annual sav­ ings would be between $6.9 billion and $10.1 billion using data for the calendar year 2015. Reflecting the incremental approach to policy development modelled here, our present estimates of the public cost of adding universal public coverage of essential medicines to the existing complement of public drug plans in Canada are lower than the previous estimates of the public cost of a universal, comprehen­ sive public drug plan. The estimated gross cost to governments (excluding indirect savings on public sector employee benefits) is $1.2 billion for coverage of essential medicines in 2015, as com­ pared with the estimated $3.4 billion for comprehensive public drug coverage in 2012/13. 41 Limitations As a simulation study, our analysis is necessarily based on assumptions concerning changes in drug utilization, product Table 5: Estimated change in public and private expenditure on all prescriptions filled in retail pharmacies with the addition of universal public coverage of essential medicines Source of finance Actual expenditure in 2015, $ millions Estimated change in expenditure on all medicines with universal public coverage of essential medicines, $ millions (%) All model parameters set to base-case scenario values All model parameters set to best-case scenario values All model parameters set to worst-case scenario values Public 10 7601229 (11) 373 (3)1979 (18) Private 15 444–4272 (–28) –5831 (–38)–2721 (–18) Tota l 26 204–3043 (–12) –5458 (–21) –743 (–3) RESEARCH CMAJ | FEBRUARY 27, 2017 | VOLUME 189 | ISSUE 8 E301 substitutions and prices. We have based our assumptions on available evidence and direct price comparisons described in the Appendix 2. To account for the range of possible outcomes, we present results with all parameters set to best­case scenario values and all parameters set to worst­case scenario values.

We were unable to compare net­of­rebate prices in Canada with those in each of the comparator countries in this study.

However, from the US Department of Veterans Affairs, we obtained an estimate of the weighted­average net­of­rebate prices for essential medicines available only from brand­name manufacturers in Canada. Those prices were 43% lower than Canadian list prices, which suggests that our assumptions about possible changes in net brand­name prices for the essential med­ icines are conservative (Appendix 2). Finally, we modelled the implications of just one example of an essential medicines list that could be used as a first stage of pharmacare reform for Canada. Changes in the number and type of drugs included on the list will affect financial impacts of expanding drug coverage in this way. Provided that the list in­ cludes 1 or more generic drugs from the high­volume chemical subclasses of medicines that account for most medication use in Canada today (as the CLEAN Meds list does), the financial im­ pacts of coverage of such treatment types will be similar to those modelled here. Expanding coverage to include additional therapeutic categories will broaden the extent of needs met and savings potential from the universal public system, but it will also increase the incremental costs to government of such a program, which would bring this incremental approach to phar­ macare development closer to the comprehensive approach modelled previously. 41 Conclusion Commissions on the Canadian health care system have repeat ­ edly concluded that universal, comprehensive public pharma­ care is the most equitable and efficient means of achieving access to appropriate and affordable care for all Canadians. Our study showed that adding universal public coverage of a model list of essential medicines to the existing complement of public drug plans in Canada could address most of Canadians’ pharma­ ceutical needs and save billions of dollars annually. Doing so may be a pragmatic step forward while more comprehensive pharma­ care reforms are planned.

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Competing interests: None declared.

This article has been peer reviewed.

Affiliations: School of Population and Public Health (Morgan), University of British Colum­ bia, Vancouver, BC; Faculty of Medicine (Li), University of Toronto, Toronto, Ont.; Faculty of Medicine (Yau), University of British Colum­ bia, Vancouver, BC; Department of Family and Community Medicine (Persaud), University of Toronto, Toronto, Ont.

Contributors: Steven Morgan and Nav Per­ saud conceived of the study. All of the authors contributed to the study design. Nav Persaud and Winny Li obtained research data. Winny Li, Brandon Yau and Steven Morgan con ­ducted the analysis. All of the authors contrib­ uted to the interpretation of results. Steven Morgan and Nav Persaud drafted the paper.

All of the authors revised the manuscript for important intellectual content, approved the final version to be published and agreed to act as guarantors of the work.

Funding: This study was funded in part by a PSI Graham Farquharson Knowledge Transla­ tion Fellowship from the Physicians Services Incorporated Foundation, by an IMPACT Award from the Ontario SPOR Support Unit and by an operating grant from the Canadian Institutes of Health Research (grant no. DCO150GP).

Funding agencies had no role in the study design, analysis or preparation of the paper. Acknowledgement:

This study is based in part on CompuScript data (January through December 2015) obtained under license from IMS Health Canada Inc. The statements, find­ ings, conclusions, views and opinions con­ tained and expressed herein are not necessar­ ily those of IMS Health Canada Inc. or any of its affiliated or subsidiary entities.

Disclaimer: Nav Persaud is an associate editor for CMAJ and was not involved in the editorial decision­making process for this article.

Accepted: Jan. 13, 2017 Correspondence to: Steven Morgan, [email protected] RESEARCH