Impact of reference-based pricing of nitrates on the use and costs of anti-anginal drugs

Background: Reference-based pricing limits reimbursement for a group of dru gs that are deemed therapeutically equivalent to the cost of the lowest-pri ced product within that group. We estimated the effect of reference-based p ricing of nitrate drugs used for long-term prophylaxis on prescribing of an d expenditures on nitrates and other anti-anginal drugs dispensed to senior citizens in British Columbia. Methods: We assessed trends in the monthly volume of prescriptions of antia nginal drugs and the associated drug ingredient cost paid by the province's publicly funded drug subsidy program, Pharmacare, and by the patients them selves for the period April 1994 to May 1999. Trends in monthly rates of ni trate expenditures per 100 000 senior citizens before the introduction of r eference-based pricing were extrapolated to infer what expenditures would h ave been without the policy. Results: During the 3 1/2 years after reference-based pricing was introduce d, Pharmacare expenditures on nitrates prescribed to senior citizens declin ed by $14.9 million (95% confidence interval $10.7 to $19.1 million). Most of these savings were due to the lower prices that Pharmacare paid for sust ained-release nitroglycerin tablets and the nitroglycerin patch, which were the 2 most frequently prescribed nitrates before the introduction of refer ence-based pricing; $1.2 million (8%) of the savings represented expenditur es by senior citizens who purchased drugs that were only partially reimburs ed. There were no compensatory increases in expenditures for other anti-ang inal drugs. Use of sublingual nitroglycerin - a marker for deteriorating he alth in patients with angina did not increase after the introduction of ref erence-based pricing. The nitroglycerin patch is now the most frequently pr escribed nitrate, owing to the fact that Pharmacare resumed the provision o f full subsidies for the drug after its manufacturers voluntarily reduced r etail prices. Interpretation: Evidence to date suggests that reference-based pricing of n itrates has achieved its primary goal of reducing drug expenditures. The ef fects of this policy on patient health, associated health care costs and ad ministrative costs remain to be investigated.