Drug pricing and reimbursement: Overview of the approval process in Canada

This video is the second in a series of four which will explain the legal framework of the health care system, and regulation of drugs and drug pricing, in Canada at the federal and provincial levels. The series is based on the Global Legal Insights publication “Pricing & Reimbursement 2020-Canada”. The third video in the series will be published next week.

Regulatory classification

Health Canada and provincial regulators

Pharmaceuticals are regulated federally by Canada’s Food and Drugs Act (F&DA), Food and Drug Regulations (FDR), and various other legislation, by Health Canada (the equivalent of the United States Food and Drug Administration). Provincial governments have oversight for the professional practice of pharmacy and the operation of pharmacies. There is also a professional college of pharmacists in each province responsible for licensing, pharmacist disciplinary actions, standards of practice, codes of ethics and other policies and guidelines.

Prescription pharmaceuticals include medicinal ingredients listed on the Prescription Drug List under the F&DA or Controlled Drugs and Substances Act (CDSA) Schedules, maintained by Health Canada. In addition to Health Canada classification, the National Association of Pharmacy Regulatory Authorities (NAPRA) implements additional guidelines relating to location of sale of pharmaceuticals in pharmacies.

Marketing approval and process

A marketing authorisation for a prescription drug in Canada is known as a Notice of Compliance (NOC) and is issued in accordance with the requirements of the FDR. In order to obtain an authorisation for sale of a drug in Canada, a drug manufacturer files a New Drug Submission (NDS) with Health Canada.

If a manufacturer wishes to include a new indication in the label of a drug or to change the strength or format/dosage form of the drug, then the manufacturer must file a Supplemental New Drug Submission (SNDS) seeking approval for this change. A new NOC is issued each time that an SNDS is reviewed and approved by Health Canada.

Generic drugs are approved via an Abbreviated New Drug Submission (ANDS) where the ANDS references data previously submitted to Health Canada by an innovator drug (known as the “reference drug”) under an NDS. Any line extensions/new indications for a generic drug are approved via a Supplemental Abbreviated New Drug Submission (SANDS). Each ANDS and SANDS receives a NOC once reviewed and approved by Health Canada.

Biosimilar products are approved via the NDS pathway, but the NDS submitted for a biosimilar is condensed as a biosimilar manufacturer can provide evidence of similarity to a previously approved biologic in order to reduce the necessary data requirements for approval.

Along with a NOC, a Drug Identification Number (DIN) is also issued for each a drug. The DIN must appear on the label of each pharmaceutical and is issued to or held in the name of the “regulatory” manufacturer—i.e., the name of the entity identified on the drug label. Over-the-counter (OTC) drugs are approved for sale following the review of a DIN submission—this is a less robust submission given the nature of the product.

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This publication is a general discussion of certain legal and related developments and should not be relied upon as legal advice. If you require legal advice, we would be pleased to discuss the issues in this publication with you, in the context of your particular circumstances.

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