Outcome 2 - Access to Pharmaceutical Services

prev page | TOC | next page

Access to cost-effective medicines, including through the Pharmaceutical Benefits Scheme and related subsidies, and assistance for medication management through industry partnerships

Major Achievements

• Listed 100 new PBS medicines or extensions to existing PBS listed medicines, with a total value of $545.6 million over five years.
• On 1 April 2012, the Expanded and Accelerated Price Disclosure initiative came into effect, which is the major component in delivering the $1.9 billion in savings as forecasted in the 2010 Further PBS Reforms Budget measure.
• 75% of community pharmacies participated in the Pharmacy Practice Incentives Program.
• Legislation and regulations in place by 1 July 2012 for the Supply and Claiming from a Medication Chart in Residential Aged Care Facilities, and the Continued Dispensing of PBS medicines in defined circumstances initiatives.
• The collection of under co-payment prescription data commenced on 1 April 2012.

Challenges

• No resolution of an appropriate treatment of Similar Biological Medicinal Products, otherwise known as ‘follow-on biologics’, in relation to their reimbursement under the PBS.
• The uptake of electronic prescriptions has been significantly less than expected.

Trends

Figure 2.1: Government PBS expenditure and cost per capita, 2007-08 to 2011-12

Text version of Figure 2.1

Figure 2.2: Urban and Rural Pharmacies 2007-08 to 2011-12

Text version of Figure 2.2

Outcome Strategy

Outcome 2 aims to provide reliable, timely and affordable access to cost-effective, sustainable and high quality pharmaceutical services and medicines.

Program 2.1: Community Pharmacy and Pharmaceutical Awareness

Program 2.1 aims to support timely access to medicines and professional pharmacy services through the implementation of the Fifth Community Pharmacy Agreement.

Fifth Community Pharmacy Agreement

The Department has continued to deliver programs and services under the Fifth Community Pharmacy Agreement. As part of this delivery, the Department has worked with a wide range of stakeholders such as the Consumers Health Forum, pharmacy peak bodies, medical bodies, and state and territory health departments ensure programs and services are of benefit to the community.

The Department has progressed the development of three key initiatives under the Fifth Agreement in preparation for their commencement in 2012-13, namely the Electronic Recording and Reporting of Controlled Drugs initiative, the Supply and Claiming from a Medication Chart in Residential Aged Care Facilities initiative, and the Continued Dispensing of PBS medicines in defined circumstances initiative. Combined, these initiatives will assist patients, pharmacists and doctors with medication management, resulting in better and safer quality use of medicines. The development of these initiatives has been challenging given the complex nature of the legislative, administrative and system changes that must be accommodated and coordinated across multiple health settings and across all jurisdictions.

The Department, in conjunction with the Pharmacy Guild of Australia, managed an evaluation of the MedsCheck and Diabetes MedsCheck (MedsCheck) Pilot. A MedsCheck service provides an in-pharmacy review of patients who are taking multiple medications, and/or have newly diagnosed or poorly controlled Type 2 diabetes. These reviews are aimed at enhancing the quality use of medicines and reducing the number of adverse drug events experienced by consumers. There is no cost to the consumer to receive either of the services.

The MedsCheck and Diabetes MedsCheck Pilot was completed and evaluated. Consultation throughout the Pilot and its evaluation took place with a range of stakeholders through the Programs Reference Group. The evaluation and consultation informed the national roll-out of the Program from 1 July 2012.

During 2011-12, 74,376 Home Medicines Reviews were undertaken.

Although this deliverable is measured against Home Medicines Reviews, it is worth noting that during the year, 125,172 Residential Medication Management Reviews were undertaken.

These medication management programs assisted consumers to access services that support them to better manage their medicines, reducing the risk of medicine related adverse events and hospitalisations.

The Department continued to provide support to rural communities through a number of pharmacy programs and services, including the Rural Pharmacy Locum Program, Continuing Professional Education Program for Rural Pharmacists, and the Rural Pharmacy Scholarship Scheme. The Department has fostered greater linkages between rural universities, rural pharmacists and rural communities through the implementation of the Regional Pharmacy Liaison Officer Program.

During 2011-12, programs supporting community pharmacy in rural and remote Australia were well accessed. The Rural Pharmacy Maintenance Allowance Program supported 89% (846 of 955) of pharmacies in rural and remote areas, based on their geographical classification under the Pharmacy Accessibility and Remoteness Index of Australia and script volume. The Program aims to ensure people in rural and remote areas can access PBS medicines through supporting access to Australia’s rural and remote pharmacy network. By providing income support to pharmacies in rural and remote areas, the Program recognises the additional financial and personal cost of operating in these areas.

The Rural Pharmacy Maintenance Allowance provided significant funding support to 846 rural and regional pharmacies to help maintain their viability.

Under the Rural Pharmacy Workforce Program, pharmacists in rural and remote Australia received assistance to access professional education, locum services, and pharmacist intern placements. The Aboriginal and Torres Strait Islander Workforce Program provided eligible Aboriginal and Torres Strait Islander students with access to 16 pharmacy assistant traineeships and five undergraduate or postgraduate pharmacy scholarships. The Program strengthened Aboriginal and Torres Strait Islander participation in the pharmacy workforce. In turn this provided improved, culturally appropriate, pharmacy services to better meet the needs of local Indigenous communities and patients.

The Department, in conjunction with the Pharmacy Guild of Australia and the National Aboriginal Community Controlled Health Organisation (NACCHO), has continued to deliver pharmacy programs and services to Aboriginal and Torres Strait Islander peoples across Australia. In March 2012, the Department, Pharmacy Guild and NACCHO hosted the Quality Use of Medicines Maximised for Aboriginal and Torres Strait Islander Peoples (QUMAX) and s100 Joint Forum. This forum brought together, for the first time, people who work and support use of medicines in Aboriginal Health Services from all parts of Australia – remote, rural and urban. This allowed for people to share their experiences and suggest improvements as to how pharmacy services could be better delivered to Aboriginal and Torres Strait Islander peoples.

Remote AHSs received support from pharmacists under the Fifth Agreement Section 100 Pharmacy Support Allowance Program for remote Aboriginal Health Services. Under the Program 22 pharmacists supported 122 AHSs.

The Pharmacy Practice Incentives Program commenced on 1 July 2011. This Program supports improved patient health outcomes by helping to ensure that pharmacy services are delivered to a defined accredited standard. It offers incentive payments to eligible community pharmacies that meet new accreditation requirements, including displaying and complying with the Community Pharmacy Service Charter (which outlines the quality of services a consumer can expect from their pharmacy). The Program also offers pharmacies incentive payments to deliver services that improve a consumer’s ability to manage their medication regimen, and through this, improve their health. The Department has worked with key stakeholders to provide ongoing education and training for pharmacists in implementing new services, such as Clinical Interventions, to identify, manage and document medicine-related problems, and a Staged Supply service where PBS medicines are delivered in instalments when requested by the prescriber.

From 1 July 2011, at least 75% of community pharmacies participated in one or more components of the Pharmacy Practice Incentives Program. The components are clinical interventions, dose administration aids, staged supply service, working with others, primary health care, and community services support.

From 1 July 2011, incentive payments have been made to eligible community pharmacies that meet new accreditation requirements. These requirements include displaying and complying with the Community Pharmacy Service Charter, which outlines the quality of services a consumer can expect from their pharmacy, and displaying a Customer Service Statement with information specific to each pharmacy, including its opening hours and what professional services are offered. In order to receive incentive payments, pharmacies must also demonstrate they have appropriate infrastructure, procedures and practices to deliver a range of professional services and demonstrate a minimum level of collaboration with other health professionals to improve patient outcomes.

The amended Pharmacy Location Rules, which took effect from 18 October 2011, provide Australians with increased access to PBS medicines by making it easier to establish new approved pharmacies in areas of community need. The amendments address the findings of an independent review of the previous Rules, conducted in 2010, and other issues identified through consultation with key stakeholders. They simplify the application process and provide more opportunities to establish a new pharmacy in areas of community need such as shopping centres, large medical centres, private hospitals, and in one pharmacy towns, where previously a relocation of an existing pharmacy was required.

The amended Rules came into effect on 18 October 2011. In 2011-12, due to the new rules, there was a significant increase in the number of new pharmacies recommended for approval, particularly in small shopping centres, large medical centres and in one pharmacy towns.

The Fourth Agreement reviews of professional programs and services have been used to strengthen Fifth Agreement programs and services. This has occurred in consultation with the Programs Reference Group and other key stakeholders.

Whole of Program Performance Information

Under the Fifth Community Pharmacy Agreement Research and Development Program the Department has arranged for research activities in six priority areas. These are: Professional Collaboration; Consumer Needs; Mental Health; Chronic Illness; Rural Pharmacy Workforce; and Health Literacy.

The Department held two Programs Reference Group meetings in 2011-12. This Group provides policy advice on Fifth Community Pharmacy Agreement programs and services. It represents a broad spectrum of people and interest groups, including consumers, pharmacy, health economics, and program evaluation. Summaries of meetings of this Group are publicly available on the Department’s website.

The Programs Reference Group also participated in the development and finalisation of the Evaluation Framework for the Fifth Community Pharmacy Agreement, which is publicly available on the Department’s website. The Evaluation Framework provides a consistent mechanism for the evaluation of programs and initiatives across the Fifth Agreement and outlines a strategy for the overall monitoring and review of the Agreement.

The Department has consulted widely with other jurisdictions, pharmacy peak bodies and the Australian Medical Association in relation to the development of the Electronic Recording and Reporting of Controlled Drugs initiative, the Supply and Claiming from a Medication Chart in Residential Aged Care Facilities initiative, and the Continued Dispensing of PBS medicines in defined circumstances initiative.

The Department released a public consultation paper on the development of a hospital-initiated referral pathway for Home Medicines Reviews, and held a further forum with interested stakeholders in relation to the development of an appropriate model for this referral pathway.

The Department has continued to engage with all stakeholders interested in the delivery of medicines and medicine related services to Aboriginal and Torres Strait Islander peoples. A key event for this in 2011-12 was the QUMAX and s100 Joint Forum.

During 2011-12, the Department also released on its website a summary of the consultations held in relation to the development and oversight of the Fifth Community Pharmacy Agreement programs and services.

During 2011-12, the Department managed Program 2.1 funds effectively and achieved a variance of 0.04%.

Program 2.2: Pharmaceuticals and Pharmaceutical Services

Program 2.2 aims to list cost-effective, innovative, clinically effective medicines on the PBS as well as improve health outcomes and the sustainability of the PBS by improving the evidence-base for prescribing decisions and assessing the effectiveness of PBS listed medicines.

Pharmaceutical Benefits Scheme

The PBS aims to provide Australians with timely access to a wide range of affordable and cost-effective medicines. In 2011-12, the PBS subsidised more than 750 medicines available in more than 1,930 forms and marketed as more than 4,200 differently branded items.

The estimate of the proportion of subsidised prescriptions listed on the Schedule of Pharmaceutical Benefits was 81% for the period 1 July 2011 to 28 February 2012. The remaining 19% of prescriptions were priced at or under the general co-payment level (currently $35.40) and dispensed to general, no-safety net patients.

194.5 million PBS prescriptions were subsidised, representing approximately 8.7 prescriptions per capita.

New Medicines Listings

A medicine cannot be included on the PBS unless the Pharmaceutical Benefits Advisory Committee (PBAC), an independent expert advisory body, recommends to the Government that it be listed. The PBAC assesses the therapeutic benefits and cost-effectiveness of medicines, including comparisons with other treatments. The PBAC membership includes medical specialists, general practitioners and other health professionals, and also consumer representation. The Department provides a wide range of support activities for the PBAC processes, including the secretariat for the PBAC and its subcommittees.

The Processes Leading to PBAC Consideration – Annual Report 2011-12 is included as an appendix to the departmental Annual Report (Appendix 1).

The Pharmaceutical Benefits Pricing Authority (PBPA) is an independent, non-statutory body established by the Minister for Health. As part of its responsibilities, the PBPA reviews prices of all brands of pharmaceutical items listed on the PBS at least once each year. The Pharmaceutical Benefits Pricing Authority Annual Report is included as an appendix to the departmental Annual Report (Appendix 2).

The PBAC met on three occasions during 2011-12. The PBAC recommendations were provided to product sponsors and the Minister for Health, and made publicly available in time frames consistent with long standing arrangements agreed with industry.

The PBAC, when considering the listing of a new medicine on the PBS, must take into account the requirements of the National Health Act 1953, that the treatment be clinically effective, and cost-effective. In 2011-12, PBAC considered 180 submissions, of which 79 were major submissions requiring cost-effectiveness analysis, and 101 were minor submissions which did not require a cost-effectiveness analysis.

In 2011-12, all submissions lodged with the secretariat of the PBAC, on or before the advertised cut-off date, were considered by the PBAC at its next scheduled meeting, within 17 weeks of lodgement.

In 2011-12, all Public Summary Documents, except for those submissions that were rejected for the first time by the PBAC, and those subject to parallel processing of PBAC/TGA evaluation provisions which did not have TGA’s delegate overview, were released 16 weeks after each meeting of PBAC. All Public Summary Documents for ‘first time rejections’ were released 18 weeks after the relevant meeting, as agreed under the Australian-United States Free Trade Agreement.

In 2011-12, all submissions lodged with the secretariat of the PBAC, on or before the advertised cut-off date, were published on the Department’s website to allow for public comment.

In 2011-12, there were 924 consumer submissions on matters before the PBAC, which was significantly higher than the 283 received in 2010-11. Consumer comments on medicines under consideration by the PBAC are summarised, provided to the medicine’s sponsor, and taken into account by the committee in its decision making process.

The Department has made further improvements to the PBS website⁵⁷ in consultation with key consumer stakeholders to improve the Department’s ability to benefit from the input of consumers. By improving the accessibility requirements for consumers, such as making the PBS Schedule available on tablet devices and smart phones, the Department is improving the availability of PBAC and PBS information to consumers and providing more avenues to comment.

The listing requirements for the 100 new medicines or extensions to existing PBS listed medicines listed on the PBS (after consideration by the PBAC and approval by the Government, against appropriate criteria such as quality, availability and price), were completed in a timely manner, taking into account that the Department must negotiate outcomes with sponsors.

Given the current fiscal environment, the Government decided in 2010-11 that all positive recommendations made by the PBAC and the PBPA for new or amended PBS listings and price increases which have a financial impact for Government, will be considered by Cabinet. Previously, Cabinet consideration was only required for the listing of high cost medicines with a cost greater than $10 million. Since the introduction of these arrangements, additions and changes to the PBS and Life Savings Drug Program recommended by the PBAC have been listed in accordance with established time frames under the revised approval process.

In accordance with the Memorandum of Understanding (MoU) with Medicines Australia, for those submissions requiring Cabinet approval, the Government has undertaken to use its best endeavours to implement a maximum time frame of six months for consideration and decision by Cabinet. The six months commences from the date of notification by the Department to the sponsor that pricing is agreed. This arrangement applies to submissions considered by the PBAC from its July 2010 meeting onward and will assist with more timely community access to new high cost medicines. All high cost medicines listed in 2011-12, subject to the provisions of the MoU, were considered by Cabinet within the six month time frame agreed under the MoU. The average time from the date of the pricing agreement to Cabinet consideration was approximately five months.

In 2011-12, 100 new medicines or extensions to existing PBS listed medicines were added to the PBS at a net cost of $545.6 million over five years. This included the listing of seven medicines on 1 December 2011 which were previously deferred by the Government in February 2011. The listing of the seven medicines followed the Government’s commitment (PBS Deferrals Statement of Principles of commitment between stakeholders), announced on 30 September 2011, that it will not defer the listing of any medicine on the PBS which will cost less than $10 million per year in each forward estimate year until 1 October 2012.

In 2011-12, the following high cost medicines were listed.

Table 2.1 High cost medicines listed in 2011-12

The Department is in ongoing discussions with the Consumers Health Forum, Generic Medicines Industry Association and Medicines Australia to work together to manage deferrals into the future.

Streamlined Listing Processes

Two new initiatives that commenced on 1 January 2011 aim to streamline the PBS listing process. These initiatives benefit patients by speeding up the time taken to list innovative medicines on the PBS.

Under the Parallel Processing Initiative, a submission to the PBAC may be lodged at any time from the date of lodgement of the Therapeutic Good Administration registration dossier. The implementation of parallel processes brings greater overlap between the two technical areas and streamlines the regulatory and reimbursements approvals. The PBAC considered the first submissions lodged under the new parallel processing arrangements at its July 2011 meeting. In 2011-12, of the 79 major submissions considered by the PBAC, 31 were submitted under the Parallel Processing Initiative.

The objective of the Managed Entry Scheme is to develop a mechanism under which the PBAC may recommend listing of a medicine at a price justified by existing evidence, pending submission of more conclusive evidence of cost-effectiveness which may justify a higher future price. The PBAC did not receive any submissions under this scheme in 2011-12.

PBS Cost Recovery Arrangements

Cost recovery arrangements for the listing of new medicines or vaccines, or to vary the listing of existing products, were introduced from 1 January 2010. Applying for a listing is a commercial decision of the product sponsor.

In 2011-12, the Department recovered $6.8 million. The shortfall in revenue was largely due to the number of applications being lower, and the numbers of waivers and exemptions being higher than forecast.

In accordance with Section 99YBC of the National Health Act 1953, an independent review into the impact of PBS cost recovery commenced in July 2011 and was completed by November 2011. The resultant report will be tabled in Parliament in due course.

PBS Cost Recovery is demand driven. Revenue depends on factors outside the control of the Department, such as the type and number of submissions, and the number of waivers and exemptions applicable.

Biological Medicinal Products

A number of regulatory and reimbursement issues also arose in relation to ‘follow-on biologics’. This term commonly used to refer to ‘generic’ versions of biological drugs (usually protein-based drugs which have a biological function in the body) made after patent expiry by companies other than the originator. In Australia these are referred to as ‘Similar Biological Medicinal Products (SBMPs)’, but they may also be referred to as ‘biosimilars’ or ‘biogenerics’.

The Department met with representatives from industry several times in 2011-12 to progress discussions on SBMPs. Various members of the industry sought to agree an approach to the reimbursement of SBMPs. While industry was able to find common ground on some aspects of reimbursement policy for SBMPs, an agreed policy position was not reached between all members, and the Pharmaceuticals Industry Council wrote to the Government to this effect on 30 May 2012.

This is a complex policy issue, with each sector of industry holding differing views. The Department, together with the Therapeutic Goods Administration and the PBAC, is working with industry to refine regulation and reimbursement processes. This will provide benefits to industry in terms of certainty. In the meantime, the National Health Act 1953 already contains provisions that provide for the pricing of biosimilar medicines. This provides a framework to ensure the continued consideration and listing of these medicines, if recommended by the PBAC.

Statins Review

Following a request by the Senate, the Department has commissioned a report to assess whether or not two medicines, rosuvastatin and atorvastatin, should be included in the existing statins therapeutic group. The PBAC provided advice on this matter at its July 2012 meeting.

National Medicines Policy

Australia’s National Medicines Policy is a cooperative endeavour to bring about better health outcomes for all Australians, focusing especially on people’s access to, and wise use of, medicines. The term ‘medicine’ includes prescription and non-prescription medicines, including complementary health care products. The Policy has four central objectives: timely access to the medicines that Australians need, at a cost individuals and the community can afford; medicines meeting appropriate standards of quality, safety and efficacy; quality use of medicines; and maintaining a responsible and viable medicines industry.

The MoU with Medicines Australia recognises the need to maintain efficiency and sustainability of the PBS as well as the need to provide some certainty in relation to pricing policy for the Australian pharmaceutical industry. The Access to Medicines Working Group has been tasked with implementing and monitoring the MoU.

The National Medicines Policy (NMP) advisory structure had responsibility for overseeing the Medication Management in Residential Aged Care Facilities Project. The project involved the development of revised Guiding Principles for Medication Management in Residential Aged Care Facilities and a Plain Language Summary for residents and carers. The project was completed on 30 March 2012 and the Department is currently finalising a strategy for implementation and distribution.

A review of the NMP advisory structure was undertaken to assess its future role, in the context of other stakeholder engagement mechanisms being utilised, to ensure advice on NMP issues are being generated in a strategic and coordinated way. Outcomes of this review will be used to ensure an appropriate NMP advisory structure can continue to address national medicines policy issues.

The collection of under co-payment prescription data commenced on 1 April 2012. Collection of this data will be a valuable additional tool for health policy planning, monitoring risk management protocols, collecting information on the adverse effects of medicines, and monitoring the quality use of medicines in the community.

The National Prescribing Service (NPS) and the National Return of Unwanted Medicines (NatRUM) program continue to implement and manage initiatives, aimed at improving the quality use of medicines and medical services by health professionals and consumers. These programs are supported by one of the 18 flexible Funds, namely the Quality Use of Diagnostics, Therapeutics, and Pathology Fund, and are discussed further in Outcome 10.

Pricing reforms agreed under the MoU, which built on the 2007 PBS Reforms, have been implemented following the passage of the amending legislation implementing statutory price reductions and the Expanded and Accelerated Price Disclosure Program, which has been applied from 1 April 2012.

Mechanisms under the MoU to reduce administrative burden and improve the timeliness of the PBS listing process, including the Managed Entry Scheme and Parallel Processing of Therapeutic Goods Administration applications and PBAC submissions, have also been implemented. Developing an understanding of trends in PBS expenditure is also on track for successful implementation.

The Government has also met a commitment for Cabinet to consider high cost drugs following pricing agreement within required time frames.

The Department established a framework during 2011-12 to systematically and rigorously review medicine use post-listing. These reviews are focusing on the appropriate use of medicines aimed at improving health outcomes and the quality use of medicines to help ensure the ongoing cost-effectiveness of listed medicines. Formal links have been established with many of the partners of Australia’s National Medicines Policy.

A variation to the existing NPS Better choices, Better health funding agreement was executed on 14 November 2011 and includes the requirement for ‘Medicineinsight’, a data collection program, to assist with post-market monitoring. The NPS is continuing to develop this program.

A Review of Anticoagulation Therapies in Atrial Fibrillation commenced to inform the Government on options for improving the health outcomes of patients treated with anticoagulation therapies, including optimising the use of currently available treatments in Australia as well as the future role of newer therapies for the treatment of atrial fibrillation. A review of PBS anti-dementia drugs to treat Alzheimer’s disease also commenced to ensure these medicines continue to be used appropriately and to ensure their ongoing cost-effectiveness as originally agreed by the PBAC. All reviews are being conducted transparently and include public consultation processes. Further work is also being undertaken to identify potential areas of need for review.

The National Medicines Policy (NMP) advisory structure provided timely and responsive advice as required to the Government on medicines policy issues. The NMP also provides the overarching guidelines for how the Government will ensure Australians have improved access to medicines and that those medicines are used safely and effectively.

The NMP advisory structure had responsibility for overseeing the Medication Management in Residential Aged Care Facilities Project. The project involved the development of revised Guiding Principles for Medication Management in Residential Aged Care Facilities and a Plain Language Summary for residents and carers. The project was completed on 30 March 2012 and the Department is currently finalising a strategy for implementation and distribution.

A review of the NMP advisory structure was undertaken to assess its future role, in the context of other stakeholder engagement mechanisms being utilised, to ensure advice on NMP issues are being generated in a strategic and coordinated way. Outcomes of this review will be used to ensure an appropriate NMP advisory structure can continue to address national medicines policy issues.

Price Disclosure

Price disclosure helps to ensure that Australian taxpayers benefit from discounts and incentives provided by manufacturers for medicines where there is more than one brand on the PBS.

Once the patent of an older medicine expires, it can be sold under a number of brand names. Manufacturers often sell these new brands at prices much lower than the Government approved price to compete for market share. Existing price disclosure brings the Government price in line with the market price, benefiting taxpayers and consumers.

The first rounds of price disclosure have resulted in price reductions for many brands of commonly used medicines on the first reduction day, which was 1 April 2012. This reduced the price paid by Government for many medicines, which helps to ensure the sustainability of the PBS. In some cases, consumers will also pay less for each PBS prescription.

100% of sponsors affected by outcomes from price disclosure calculations were notified in accordance with industry agreed time frames.

In total over 1,000 brands of 75 drugs took a price reduction on 1 April 2012, ensuring that the $1.9 billion in savings, negotiated as part of the Memorandum of Understanding between the Government and Medicines Australia, was realised.

All timelines under Expanded and Accelerated Price Disclosure have been met and price reductions were applied where applicable.

Price disclosure saved the Government $112.5m in 2011-12. Price disclosure-related price reductions are an adjustment of the prices the Commonwealth pays for heavily discounted drugs, to more closely reflect the prices at which the drugs are supplied to the pharmacist. Reductions occurring in 2011-12 ranged from 10.31% to 72.54%.

Further PBS Reform saved the Government $189.3m in 2011-12. This includes Expanded and Accelerated Price Disclosure, savings from the 2% and 5% reductions on 1 February 2011 in the prices of all medicines listed on the F2A and F2(T) formularies respectively on 11 October 2010; and savings from the 1 February 2011 increase from 12.5% to 16% in the statutory price reduction applied to all medicines when their first generic competitor lists on the PBS.

Whole of Program Performance Information

The Department continued to provide high quality advice in a timely manner on a range of issues.

Through the review of PBS medicine use post-listing, the Department continued to assess the quality use of medicines aimed at improving health outcomes and ensuring the sustainability of the PBS.

Throughout 2011-12 the Department assisted Government and other agencies with advice to inform the negotiations of various free trade agreements such as the Trans-Pacific Partnership Agreement (TPP). Advice provided by the Department was always within the time frame required to appropriately inform these negotiations.

The Department is also working with the generics industry to identify and resolve issues related to delays to market entry for generic medicines.

Regular meetings, both formal (including the Access to Medicines Working Group, the Generic Medicines Working Group and the Pharmaceutical Industry Working Group) and informal, have provided industry with an opportunity to discuss medicines and industry issues, including the uptake of generic medicines. Issues around the National Medicines Policy, particularly those relating to access and quality use of medicines issues, are part of an open and ongoing dialogue with all partners to Australia’s National Medicines Policy.

Through these forums, the Department worked with all stakeholders across a range of issues including the implementation of the MoU, which includes pricing policy designed to ensure the ongoing sustainability of the PBS while providing a period of certainty and sustainability for all industry members.

Several large demand driven programs are administered under Program 2.2 some of which have parameters that change throughout the year.

Program 2.3: Targeted Assistance – Pharmaceuticals

Program 2.3 aims to improve access to new and existing medicines for patients with life threatening conditions.

Access to Life Saving Medicines

The Life Saving Drugs Program provided 215 eligible patients with free access to expensive life saving medicines for very rare life-threatening conditions in 2011-12. During the year, nine medicines were funded through the program for the treatment of seven separate disorders including: imiglucerase (Cerezyme®) and miglustat (Zavesca®) to treat Gaucher disease; agalsidase alfa (Replagal®) and agalsidase beta (Fabrazyme®) for Fabry disease; laronidase (Aldurazyme®) for Mucopolysaccharidosis (MPS) Type I; idursulfase (Elaprase®) for MPS Type II; galsulfase (Naglazyme®) for MPS Type VI; alglucosidase alfa (Myozyme®) for infantile-onset Pompe disease; and eculizumab (Soliris®) for Paroxysmal Nocturnal Haemoglobinuria.

Each condition has separate eligibility guidelines, developed and administered with the advice of an expert disease advisory committee and any proposed amendments are submitted to the PBAC for consideration.

Global shortages of Fabrazyme® and Cerezyme® continued to have a significant impact on the availability of these medicines through the Life Saving Drugs Program for treating Fabry and Gaucher diseases. The Department worked with industry and clinical advisory committees to ensure the best outcome for patients receiving treatment through the program.

In 2012-13 the Department will work with industry to finalise Deeds of Agreement for terms of supply for all medicines supplied through the Life Saving Drugs Program, with risk share arrangements to effectively manage expenditure.

All applications are assessed, and all patients are reviewed every six months against the relevant eligibility criteria for the respective disease. Risk share arrangements are in place for the majority of suppliers to cap Commonwealth expenditure.

The guidelines are used by the disease advisory committees to assess patients’ initial and ongoing eligibility. This assessment process can lead to the identification of the need for appropriate changes to guidelines. All guidelines are submitted to the PBAC with the Life Saving Drugs Program (LSDP) Annual Report. No substantive changes were made to LSDP condition guidelines in 2011-12.

The Department provided assistance to 215 patients through the LSDP. All eligible patients who met the criteria for access to the Program were assisted in 2011-12. The lower than forecast number is a result of the demand-driven nature of the Program.

All applications were processed within 30 calendar days of receipt of the complete data package to support the application.

The Department provided fully subsidised medicines to eligible patients. However, due to global supply shortages of Fabrazyme® and Cerezyme®, the dose for some patients was reduced. This was managed in consultation with relevant clinical advisory committees and the doctors of affected patients.

Whole of Program Performance Information

The Department coordinated the second LSDP Annual Report which was accepted by the PBAC at its July 2012 meeting. The LSDP Annual Report includes patients’ responses to treatment and an analysis of significant events that impacted on the administration of the LSDP. This will assist policy makers with a better understanding of the operation of the Program.

The Department held 11 Disease Advisory Committee meetings in 2011-12, which resulted in advice on clinical management issues. The Department also formally consulted with external stakeholders on deed negotiations and informally as required.

Several large demand driven programs are administered under Program 2.3 some of which have parameters that change throughout the year.

Program 2.4: Targeted Assistance – Aids and Appliances

Program 2.4 aims to provide support for people with diabetes; continue to assist people with a stoma by providing free stoma related products; and ensure continued access to clinically appropriate dressings to improve the quality of life for people with Epidermolysis Bullosa.

National Diabetes Services Scheme

The Department successfully implemented a new five-year agreement with Diabetes Australia to continue to administer the National Diabetes Services Scheme (the Scheme). The Scheme aims to ensure that people with diabetes have access to subsidised products and services needed for the self-management of diabetes.

More than one million Australians will benefit from improved services and information as part of the new five-year agreement, with particular emphasis placed on increasing access for the newly diagnosed, children and their families, culturally and linguistically diverse communities, Aboriginal and Torres Strait Islander communities and disadvantaged communities.

The Department actively participated in a product supply and delivery review, product schedule review and registrant support services review being progressed by the Scheme administrator – Diabetes Australia. When the reviews are completed, their findings should help ensure the best outcomes for the Scheme and its registrants.

A new agreement with Diabetes Australia to deliver the Scheme commenced on 1 July 2011.

From 1 July 2011, people (with non-insulin dependent type 2 diabetes) prescribed an injectable blood glucose lowering medication have been able to access needles and syringes on the Scheme.

All eligible people with non-insulin dependent type 2 diabetes have been able to access needles and syringes through the scheme as required.

As at 30 June 2012 there were 1,037,621 people with diabetes registered on the National Diabetes Services Scheme. Of those, 660,458 directly benefited from accessing subsidised products through the Scheme. All people registered with the Scheme benefited from a range of educational and information services. The lower than forecasted number of people receiving benefit is a result of the demand-driven nature of the Scheme.

Type 1 Diabetes Insulin Pump Program

The Department continued to monitor the delivery of the Program to ensure it provides appropriate assistance to children with type 1 diabetes.

The Department, in conjunction with the Juvenile Diabetes Research Foundation which administers the Program, will conduct a review of the Program in 2012-13 to ensure that it continues to meet its objective of subsidising the cost of insulin pumps for families in financial need who have children with type 1 diabetes.

The number of insulin pump subsidies provided under the Program increased substantially because of the donation of the co-payment by third parties on behalf of participants who had difficulty in raising the required amount, during 2011-12.

All applicants that met the Program’s financial and clinical eligibility criteria received a subsidised insulin pump.

The Program is currently meeting its objective to provide subsidised insulin pumps to eligible people under the age of 18 years. The Department has worked collaboratively with the administrator of the Program to ensure ongoing stakeholder satisfaction.

Stoma Appliance Scheme

The Department continued to support the revised program pricing and listing framework for the Stoma Appliance Scheme, including listing 34 new products on the Scheme. These new products, while being cost neutral to the Scheme, have offered a wider choice of subsidised products.

The Stoma Appliance Scheme is a demand driven program and the number of people assisted varies according to surgeries performed.

The Department facilitated 3 meetings of the Stoma Product Assessment Panel in 2011-12.

All appliances recommended for listing on the Stoma Appliance Scheme were assessed by an expert panel with appropriately qualified health economists and clinicians.

In 2011-12 the Department listed 34 new products on the Stoma Appliance Scheme that were assessed as clinically and cost-effective by the Stoma Product Assessment Panel.

National Epidermolysis Bullosa Dressing Scheme

The Department has continued to provide access to clinically appropriate dressings for people with epidermolysis bullosa through the National Epidermolysis Bullosa Dressing Scheme. The Scheme continues to assist people with epidermolysis bullosa by reducing the financial burden associated with purchasing necessary dressings.

The Department continued to work closely with BrightSky Australia to ensure efficient administration of the Scheme during 2011-12.

During 2011-12, 81 people were eligible and 73 people accessed subsidised products through the Scheme. Patient numbers and access rates fluctuate based on need and progression of the individuals’ condition. All eligible patients who met the criteria for access to the program were assisted in 2011-12. The lower than forecast number is a result of the demand-driven nature of the program.

Quarterly reporting by the administrator of the Scheme indicates overall satisfaction and has identified that no negative feedback has been received from Scheme participants.

All patients who met the eligibility and compliance criteria received subsidised dressings in 2011-12.

Whole of Program Performance Information

Policy research provided in 2011-12 in relation to Program 2.4 was based on desk-based research, horizon scanning, consultation and expert opinion through a variety of avenues.

Specifically, in 2011-12 three comprehensive reviews commenced under the National Diabetes Services Scheme, namely a Product Schedule Review, a review of the Product Supply and Delivery arrangements, and a review of Registrant Support Services Provided under the Scheme. The reviews are due to be completed in 2012-13 and will ensure that future program delivery is evidence-based on policy research.

Recommendations to list products under the Stoma Appliance Scheme and the National Epidermolysis Bullosa Dressing Scheme were made in 2011-12 following evidence-based applications and submissions from suppliers, which are then assessed by relevant experts on the Stoma Product Assessment Panel and the National Epidermolysis Bullosa Dressing Scheme’s Clinical Advisory Committee respectively. These groups have also assessed evidence to inform ongoing policy improvements to the Schemes’ operations.

The National Diabetes Services Scheme (NDSS) has provided a range of formal and informal consultation avenues in line with the requirement of the NDSS Agreement which has enabled stakeholders to contribute to, and provide feedback on, new programs and initiatives to be delivered through the Scheme from 1 July 2012 to 30 June 2016.

Several large demand driven programs are administered under Program 2.4 some of which have parameters that change throughout the year.

Outcome 2 – Financial Resources Summary

1. Departmental appropriation combines ‘Ordinary annual services (Appropriation Bill 1)’ and ‘Revenue from independent sources (s31)’.
2. ‘Expenses not requiring appropriation in the current year’ is made up of depreciation expense, amortisation, make good expense and audit fees. This estimate also includes approved operating losses – please refer to the departmental financial statements for further information.

57. Available at: www.pbs.gov.au
58. Includes savings to both the Pharmaceutical Benefits Scheme and the Repatriation Pharmaceutical Benefits Scheme.
59. The LSDP is demand driven and patient numbers for all LSDP drugs are captured in the ‘Percentage of eligible patients with access to fully subsidised medicines through the Life Saving Drugs Program’.

prev page | TOC | next page