Spiralling Medical Costs: Why Canada Needs NICE Medicine

Abstract

Healthcare spending in Canada has grown rapidly in recent years, especially for drugs. This paper discusses the causes of the problem and makes policy proposals. Conflicts of interest (COIs) are a frequent occurrence in medical research and lead to bias. Published studies, especially in the area of clinical trials on drugs, are much more likely to produce findings favourable to the drug when funded by the manufacturer. Bias can occur by various means, including inappropriate study design (such as giving a placebo to control subjects rather than an existing drug) and selective publication of results. COIs also frequently occur with clinical practice guidelines. High-priced (particularly new) drugs are often marketed by inappropriate means. Drug costs in Canada could be greatly reduced if doctors prescribed lower-cost alternatives where appropriate (therapeutic substitution). Proposals are made for changes in the regulatory agencies responsible for the approval of drugs, drug marketing and post-marketing surveillance. In addition, a new regulatory agency is proposed that would examine the value of drugs and medical devices in terms of clinical effectiveness and cost-effectiveness. Such an agency would set the rules for therapeutic substitution and would determine which medical interventions can be used based on agreed cost-effectiveness criteria.