"Cost-effectiveness" estimates result in flawed decision-making in listing drugs for reimbursement

Facing financial pressures, the provinces and territories have chosen to use "cost-effectiveness" for making decisions about drug listings. This study examines the scientific basis for the procedures used to determine cost-effectiveness in 5 Canadian provinces.

Questionnaires were mailed to key provincial informants asking about the respondent's expertise and role, the administrative and scientific basis for decision-making, organizational structures and other factors in the scientific evaluation and decision-making process, and the transparency of the process. There were also questions about the data required and received and their importance, the place of cost-effectiveness and other economic impact evaluations, the data sources for them, and the use of follow-up monitoring to evaluate the decisions made.

Information required by the provinces for decision-making about cost-effectiveness is not available to them at the time of their decisions about listing new medications. The primary sources of data on both efficacy and cost-effectiveness are pharmaceutical companies. Efficacy information is generated in a scientifically rigorous manner, whereas the effectiveness and cost data are estimates potentially subject to biases and evaluated by judgement (expert opinion) alone. Moreover, there is no collaboration in the assessment process between provinces. The outcomes are large differences between provinces in the decisions made and, hence, in the pharmaceuticals accessible to residents.

Current methods for making decisions about provincial drug listings are based on inadequate data, and the lack of consistency in the provinces' decisions suggest they may be scientifically flawed. We recommend establishing a single national scientific review committee, with re-evaluation of each drug's cost-effectiveness after a suitable period of monitored use.