Department of Health submission to the Senate Inquiry on the availability of new, innovative and specialised cancer drugs in Australia

Despite having very high rates of cancer, Australia’s cancer survival outcomes are equivalent to the best in the world. Australia’s one year survival rate for all cancers combined is 81%, and overall five year relative cancer survival rates are now more than 66%.

Page last updated: 14 April 2015

Dept of Health submission - Senate Inquiry into cancer medicines for website (Word 1867 KB)
Dept of Health submission - Senate Inquiry into cancer medicines for website (PDF 1766 KB)

Despite having very high rates of cancer, Australia’s cancer survival outcomes are equivalent to the best in the world. Australia’s one year survival rate for all cancers combined is 81%, and overall five year relative cancer survival rates are now more than 66%.

This success is not due to one sole aspect of Australia’s world class health system, but to the system working effectively across the continuum of cancer care – from excellent screening programmes, to affordable access to the medical specialists and high quality care that all cancer patients require to have the best chance of good outcomes.

Access to effective cancer medicines is an important component of that system insofar as it further improves health outcomes for cancer patients. Australia has a very good record on providing subsidised access to cancer medicines. There are over 100 medicines for the treatment of cancer on the Pharmaceutical Benefits Scheme (PBS). Expenditure for currently listed medicines was close to $1.5 billion in 2013 14; that is one in every six dollars expended through the PBS. This is up from one in eight dollars in 2012-13 and this proportion is likely to increase. At their March 2015 meeting alone, the Pharmaceutical Benefits Advisory Committee (PBAC) will be considering 11 major submissions for cancer medicines, with a potential total cost of $589 million if they are recommended for PBS listing.
Access to medicines ultimately depends on their affordability for patients. The PBS ensures that although the cost of most new cancer therapies can run to many thousands of dollars, Australian patients pay no more than the co payment. On average over the last five financial years, the patient co-payment funded between 2 3% of the total cost of cancer medicines, compared to 15% for non-cancer medicines. The taxpayer funds the remainder.

PBAC processes have been evolving over the years to include changes such as the Managed Entry Scheme and “pay for performance” pricing arrangements. These changes are slowly being taken up by companies as their value is recognised. Notwithstanding Australia’s successes, there is always room for improvement and changes to PBAC processes can be considered, to ensure they continue to provide the optimal circumstances for all cost effective new medicines to make successful submissions. Community interests will also continue to be served. For example, improving transparency by making the majority of the documents publically available and allowing an effective discussion in the community of the real benefits, harms and cost of the products, as well as reducing the number of re submissions, is in everyone’s interest.

In line with the National Medicines Policy, industry must also play its part in any PBS reform. The availability of new medicines is dependent on the timing of submissions to the PBAC, which is in the hands of pharmaceutical companies. The pricing of new cancer therapies should also be more closely aligned to their patient outcomes. There have been few ‘transformative’ cancer medicines in recent years and there is a risk to innovation if business models continue to focus on the financial rewards associated with ‘me-too’ medicines, and not significant innovation.
Australia’s challenges with access to expensive new medicines, including cancer medicines, are not an isolated experience. Expenditure on cancer medicines has increased worldwide (up to an estimated $91 billion in 2013) and the pipeline for new medicines is strong. Almost 1,000 anti cancer medicines are currently in various phases of pre-approval testing; more than the number for heart disease, stroke, and mental illness combined.[1] There are real challenges in establishing the evidence to support the high costs for many of these medicines, especially when benefits are incremental. Many clinicians, as well as third party payers, have expressed serious concern for future health expenditure if systems don’t evolve to meet these challenges.

Moreover, there are opportunity costs to patients of resourcing cancer medicines at the expense of other aspects of the cancer care continuum. A focus on cancer medicines can also affect access to new medicines for patients with other diseases, such as hepatitis C or cardiovascular disease. It is important that all partners in the operation of the PBS take responsibility for achieving timely access to medicines and value for money, and to ensure that cost-effectiveness is not lost to the expectation of quicker access to medicines of marginal or unproven benefit.