Reimbursement of Drugs for Rare Diseases in Canada: Do Treatment Cost and Cost-Effectiveness Ratio Correlate With Epidemiologic Factors?

OBJECTIVES: Most health economists agree that benchmarking annual treatment cost and cost-effectiveness of drugs for rare diseases (DRDs) versus non-DRD drugs is inappropriate. However, there is limited agreement regarding an acceptable level of premium for rarity to the annual cost per patient and incremental cost-effectiveness ratios (ICER) for the DRDs. This study aimed to evaluate whether annual drug costs and/or sponsor submitted ICERs for DRDs were correlated with epidemiologic factors, such as patient population size, and availability of treatment comparators using information from the Canadian Agency for Drugs and Technologies for Health (CADTH) reimbursement reviews database.

METHODS: We reviewed final CADTH recommendations from 2012–2022 for non-oncology DRDs (i.e., diseases with a prevalence rate of less than 50/100,000 population). Submitted annual drug costs, ICERs, prevalence rates, incidence rates, target age groups (adults, pediatrics, both), and comparators were extracted from the recommendations. Data were analyzed using R.

RESULTS: Recommendations were reviewed for 65 non-oncology DRDs. Median annual drug costs and median sponsor-submitted ICERs were positively correlated with disease rarity; the rarest diseases had the highest median per-patient annual drug cost and sponsor-submitted ICER. Among the reimbursed DRDs, every 10-fold decrease in prevalence was associated with an approximately CAD$300K/QALY increase in the median sponsor-submitted ICER. Drugs that are exclusive to treating the pediatric population tend to associate with higher annual treatment costs and ICERs compared to those exclusive to treating adults.

CONCLUSIONS: These results indicate that, even though CADTH has not established an official position on an acceptable ICER threshold for DRDs, sponsor submitted annual treatment costs and ICERs for DRDs, many of which have received a positive reimbursement recommendation, tend to correlate with disease rarity. Therefore, sponsors of DRDs should consider submitting request for public reimbursement in Canada even if their annual cost per patient and ICER are higher compared to non-DRD drugs.