Erbitux Withheld From Canadians

Bristol Myers Squibb Canada (BMS Canada) has taken the unusual step of not launching its colorectal cancer drug Erbitux after it could not agree on a price with Canada's Patented Medicine Prices Review Board (PMPRB). The drug was approved by Health Canada nine months ago, but the PMPRB refused to allow BMS Canada to charge its proposed price because, it said, that price was too high. The Cancer Advocacy Coalition of Canada estimates that the drug, which is used to treat advanced cases of colorectal cancer, costs about Cdn$56,000 for a standard course of therapy. The Ontario government has been spending large amounts to fund the treatment of 34 cancer patients who have applied for and been accepted to receive Erbitux in the United States. In the fiscal year 2005-2006, this cost was Cdn$3.6 million, or US$24,000 per patient every month, until completion of the therapy. According to the Canadian Cancer Society, this year an estimated 20,000 people in Canada will be diagnosed with colorectal cancer and about 8,500 are expected to die from the disease. In Europe, Erbitux sells for less than half the price charged in the United States – about €4,000 (or Cdn$5,677) per month. This is because Europe has a strict system of price controls and is prepared to force compulsory licensing. No doubt the European price would have affected what BMS Canada could charge for Erbitux because when a new drug is introduced in Canada, the PMPRB examines the prices being commanded in Germany, France, Italy, Sweden, Switzerland and the United Kingdom and compares these to the price being commanded in the United States. The price set for Canada cannot be the highest of these, and typically it must fall somewhere in the middle. Some observers have urged that, as a tactical move, Canada threaten compulsory licensing (since it has retained the power to do so under under existing legislation). In Canada, market forces alone tend to have little effect on the normal inducement of gaining incremental profit from selling more pharmaceuticals because of the relatively small size of the domestic Canadian market - being only about 2% of the world market. This controversy comes many months after the cross-border conflict over cheaper drugs from Canada entering the US via mail order and online pharmacies has appeared to die down (see E-TIPS®, "Drug Importation into the US from Canada – New developments", Vol 3, No 6, September 1, 2004). For the full text of relevant news articles, see: http://makeashorterlink.com/?F34221D5D; http://makeashorterlink.com/?Q16212D5D; and http://makeashorterlink.com/?E17221D5D Summary by: Heather Watts