VCU accepted July 15, 2004
Voluntary Compliance Undertaking of Servier Canada Inc. to the Patented Medicine Prices Review Board
1. Product Summary
1.1. Starnoc (zaleplon) is a patented medicine sold in Canada by Servier Canada Inc. (Servier). It is a new active substance (also referred to as a new chemical entity) and its ATC classification is N05CF03.
1.2. Starnoc is indicated for the short-term treatment and symptomatic relief of insomnia in patients who have difficulty falling asleep. The recommended dose of Starnoc for adults is 10 mg immediately before bedtime or after the patient has gone to bed and has had difficulty falling asleep. The 5 mg dose is reserved for elderly or debilitated patients. Treatment with Starnoc should not usually exceed seven to ten days of consecutive use.
1.3. Canadian Patent 1,270,825 pertaining to Starnoc was granted on June 26, 1990 to American Cyanamid Co. of the USA (now Wyeth Holdings Corporation of the USA) and will expire on June 26, 2007. Servier is a licensee of Wyeth-Ayerst USA with respect to this patent and is the patentee for the purposes of the Patented Medicine Prices Review Board (“PMPRB”).
1.4. Since the date of first sale in 2000, Starnoc has been sold at prices of $1.00 and $1.23 for the 5 mg and 10 mg capsules respectively. Starnoc is not reimbursed by any of the provincial or federal drug benefit programs.
2. Application of the Excessive Price Guidelines
2.1. In accordance with the PMPRB´s Excessive Price Guidelines (the “Guidelines”), Board Staff conducted the review of the prices of Starnoc. Starnoc was classified as a category 3 new medicine.
2.2. The Therapeutic Class Comparison (“TCC”) Test was conducted using Imovane (zopiclone) as the appropriate comparable medicine. For purposes of the TCC comparison, 5 mg per day of Starnoc was compared to 5 mg per day of Imovane and 10 mg per day of Starnoc was compared to 7.5 mg of Imovane per day.
2.3. The results of the TCC Test indicated that the price of Starnoc 5 mg of $1.0000 per capsule exceeded the maximum non-excessive (“MNE”) price of $0.2975 per capsule by 236.1%. The price of Starnoc 10 mg of $1.2300 per capsule exceeded the MNE price of $0.6816 per capsule by 80.5%.
2.4. At introduction Starnoc 5 mg and 10 mg were also sold in Germany, Italy, Sweden, Switzerland, the U.K. and the U.S. In compliance with the Guidelines, the prices in Canada did not exceed the range of prices in the other countries in which they were sold. The price of Starnoc 5 mg of $1.00 was higher than the median of the foreign prices ($0.4526) and the price of Starnoc 10 mg of $1.23 was higher than the median price ($0.5759).
2.5. In the subsequent reporting periods, the prices of Starnoc 5 mg and 10 mg continued to exceed their respective CPI-adjusted MNE price.
3. Terms of the Voluntary Compliance Undertaking
3.1. This Voluntary Compliance Undertaking ("VCU") constitutes no admission by Servier that the prices of Starnoc 5 mg and 10 mg capsules are or were excessive pursuant to the application of the patented medicines provisions of the Patent Act and the regulations.
3.2. In order to comply with the Guidelines, Servier undertakes the following:
3.2.1. To agree that the MNE price of Starnoc 5 mg capsule in Canada for 2000 and 2004 are $0.4526 and $0.4964, respectively;
3.2.2. To agree that the MNE price of Starnoc 10 mg capsule in Canada for 2000 and 2004 are $0.6816 and $0.7475, respectively;
3.2.3. To reduce the current prices of Starnoc 5 mg and 10 mg capsules to the 2004 MNE prices within 30 days of the acceptance of this VCU;
3.2.4. To ensure that the prices of Starnoc in 2004 are within the Guidelines;
3.2.5. To offset excess revenues received during the period from January 1, 2004 to June 30, 2004 by making a payment of $739,739.99 to Her Majesty the Queen in Right of Canada within 30 days of the acceptance of this VCU;
3.2.6. To offset the remaining excess revenues of $3,838,801.86 by maintaining the prices of all of its patented medicines at levels below the CPI-adjusted prices until the end of June 2006. In the event any excess revenues have not been offset by the end of June 2006, Servier shall make a payment to Her Majesty the Queen in Right of Canada by July 30, 2006 for such amount;
3.2.7. To file evidence with the PMPRB within 30 days of acceptance of the VCU that the average transaction price has been reduced in a manner consistent with the terms of this undertaking;
3.2.8. To ensure that the average transaction prices of Starnoc remain within the Guidelines in all future periods in which it remains under the Board's jurisdiction.
Servier Canada Inc.
Signature: Original signed by
Company Officer: Michael Sumpter
Position: General Manager
Date: July 7, 2004