National Health Act 1953 - Amendment determination under section 84AF (No. PB 3 of 2008)

Administered by Department of Health, Disability and Ageing

Legislation au F2007L04465 Not in force Legislative Instrument

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EXPLANATORY STATEMENT

INSTRUMENT NUMBER PB 3 OF 2008

NATIONAL HEALTH ACT 1953

AMENDMENT DETERMINATION UNDER SECTION 84AF

 

 

Purpose and operation

Part VII of the National Health Act 1953 (the Act) is the legislative basis of the Pharmaceutical Benefits Scheme (PBS) by which the Commonwealth provides reliable, timely, and affordable access to a wide range of medicines for all Australians.

Subsection 85(1) provides that benefits are to be provided by the Commonwealth in accordance with Part VII in respect of pharmaceutical benefits.

Drugs and medicinal preparations to which Part VII applies are declared by the Minister by legislative instrument to be so under subsection 85(2). These are listed drugs as defined in subsection 84(1).  Part VII also applies to certain extemporaneously-prepared medicinal preparations as a result of declarations under paragraph 85(2)(b).

The Minister by legislative instrument can determine the form or forms of a listed drug by reference to strength, type of unit, size of unit or otherwise (subsection 85(3)); the manner of administration of the form of the listed drug so determined (subsection 85(5)); and a brand of the pharmaceutical item (defined in subsection 84(1)) that has the listed drug in that form with that manner of administration (subsection 85(6)).  These determinations govern (except for certain extemporaneously-prepared pharmaceutical benefits) what constitutes the pharmaceutical benefit (defined in subsection 84(1)) under Part VII of the Act.

Section 84AF empowers the Minister to determine that a person is the responsible person for a brand of a pharmaceutical item.  The Minister can do this if the person has notified the Minister that the person is or will be the supplier of the brand of the pharmaceutical item to wholesalers or, if not, to approved pharmacists directly.  The brand must be a listed brand (defined in subsection 84(1) as a brand in relation to which a determination under subsection 85(6) is in force), and there can be no determination in force that any other person is the responsible person for the brand of the pharmaceutical item or of any other pharmaceutical item.

A responsible person for a brand of pharmaceutical item has various responsibilities or functions under the Act.  These include those in relation to entering into price agreements under section 85AD, compliance with price disclosure requirements under Division 3B, and the requirement to supply certain brands of pharmaceutical item for a specified period under Division 3C.

This instrument determines the responsible persons for the brands of pharmaceutical items set out in Schedule 1 to the instrument.  These persons are bodies corporate and are identified in Schedule 1 by their company name and Australian Business Number (ABN).  The names of the responsible persons were notified before the commencement of section 84AF as permitted by subsection 84AF(2). 

This legislative instrument in giving effect to recommendations of the Pharmaceutical Benefits Advisory Committee (PBAC) amends the determination under section 84AF made by legislative instrument number PB 90 of 2007 which came into effect on 1 December 2007.  The amendments are set out in the items of Schedule 1 to the instrument.

A provision-by-provision description of the instrument is contained in the Attachment.

This instrument, expressed to commence on 1 January 2008, was made on 19 November 2007.

 


Consultations

This instrument affects pharmaceutical companies with medicines listed on the PBS. In relation to the introduction of the responsible person measure, pharmaceutical companies have been consulted during both the policy development and implementation phases.  This has occurred through meetings with both peak body organisations and individual companies.  Information on this measure has been disseminated through peak industry bodies and during regular meetings with a Stakeholder Reference Group. Particular information on the Responsible Person provisions has been provided by letter to those companies to whom the provisions will apply. Under section 84AF the Minister may only determine a person to be the responsible person for a brand of a pharmaceutical item if the person has notified the Minister that the person is or will be the supplier of the brand of the pharmaceutical item.  Each of the persons determined in the instrument to be responsible persons has given the required notification to the Minister.

The PBAC is an independent expert body established by section 100A which makes recommendations to the Minister about which drugs and medicinal preparations should be available as pharmaceutical benefits.  PBAC members are appointed following nomination by prescribed organisations and associations from consumers, health economists, practising community pharmacists, general practitioners, clinical pharmacologists and specialists, with at least one member selected from each of those interests or professions.  Remaining members are persons whom the Minister is satisfied have qualifications and experience in a field relevant to the functions of the PBAC, and that would enable them to contribute meaningfully to the deliberations of the PBAC.  When recommending the listing of a medicine on the PBS, the PBAC takes into account the medical conditions for which the medicine has been approved for use in Australia, its clinical effectiveness, safety and cost-effectiveness compared with other treatments.

ATTACHMENT

 

Paragraph 1: provides that this instrument commences on 1 January 2008.

Paragraph 2: provides that Schedule 1 amends PB 90 of 2007.

Schedule 1: provides for the following amendments:

 

SCHEDULE 1

 

Additions

 

Varenicline Box containing 11 tablets 0.5 mg (as tartrate) and 14 tablets 1 mg (as tartrate) in the first pack and 28 tablets 1 mg (as tartrate) in the second pack (Champix)

 

 Tablet 1 mg (as tartrate) (Champix)

 

 

 

Overview

The National Health Act 1953, as amended by the National Health Amendment (Pharmaceutical Benefits Scheme—Responsible Persons) Determination 2007, introduced mechanisms to enhance the management and oversight of the Pharmaceutical Benefits Scheme (PBS). The Act, overseen by the Australian Parliament, aims to ensure reliable, timely, and affordable access to a wide range of medicines for all Australians. The amendment, made under section 84AF of the Act, empowers the Minister to designate responsible persons for specific brands of pharmaceutical items. This legislative instrument, which came into effect on 1 January 2008, was designed to give effect to the recommendations of the Pharmaceutical Benefits Advisory Committee (PBAC). The PBAC, an independent expert body, evaluates drugs and medicinal preparations for inclusion in the PBS, considering factors such as clinical effectiveness, safety, and cost-effectiveness. The amendment ensures that only notified suppliers can be designated as responsible persons, thereby improving the accountability and efficiency of the PBS.

Scope and Application

The National Health Act 1953 Amendment Determination under section 84AF applies to pharmaceutical companies with medicines listed on the Pharmaceutical Benefits Scheme (PBS). The Act provides the legislative basis for the PBS, ensuring Australians have reliable, timely, and affordable access to a range of medicines. This particular amendment determines the responsible persons for specific brands of pharmaceutical items, who are identified as bodies corporate in Schedule 1 of the instrument by their company name and Australian Business Number (ABN). The responsible person is the entity that supplies the brand of pharmaceutical item to wholesalers or directly to approved pharmacists. These companies have various responsibilities under the Act, including entering into price agreements, complying with price disclosure requirements, and supplying certain brands for specified periods. The amendments set out in Schedule 1 of the instrument, which commenced on 1 January 2008, affect the determination of responsible persons for particular brands of pharmaceutical items, including Varenicline, as per the recommendations of the Pharmaceutical Benefits Advisory Committee (PBAC). The PBAC is an independent expert body that advises the Minister on which drugs and medicinal preparations should be available as pharmaceutical benefits. The PBAC considers factors such as the medical conditions for which the medicine has been approved, its clinical effectiveness, safety, and cost-effectiveness compared with other treatments when making its recommendations.

Key Provisions

The primary operative sections of the instrument, as per the F2007L04465 Explanatory Statement, focus on amending the Pharmaceutical Benefits Scheme (PBS) under the National Health Act 1953. Specifically, it pertains to the designation of responsible persons for certain brands of pharmaceutical items listed on the PBS, as mandated by subsection 84AF(1). This legislative instrument, which amends a previous determination under section 84AF (PB 90 of 2007), outlines the specific brands of pharmaceutical items and the companies designated as responsible persons for these brands. The responsible persons, identified by their company names and Australian Business Numbers (ABNs), are required to have notified the Minister of their intent to supply the specified brands either to wholesalers or directly to approved pharmacists. The Act imposes several obligations on the parties it governs, particularly those designated as responsible persons. These obligations include entering into price agreements as required under section 85AD, complying with price disclosure requirements under Division 3B, and ensuring the supply of certain brands of pharmaceutical items for a specified period under Division 3C. The responsible persons must ensure that the pharmaceutical items they supply meet the standards and criteria set out by the Minister, particularly with respect to the form, strength, and administration of the drugs. Furthermore, these companies must notify the Minister if they cease to be the supplier of the brand or if they intend to supply the brand directly to approved pharmacists. In terms of consequences for breach, the Act does not specify detailed penalties within the explanatory statement. However, generally, breaches of the National Health Act 1953 can lead to civil or criminal consequences. For civil breaches, the Minister may take action to enforce compliance, which could include fines or other corrective measures. Criminal offences, which may be prosecuted under the Act, can result in substantial fines and, in some cases, imprisonment. The specific penalties depend on the nature and severity of the breach but can include fines of up to $210,000 for individuals and $1,050,000 for bodies corporate, as well as potential imprisonment terms. The Minister's authority to enforce these penalties ensures that the provisions of the Act are upheld, maintaining the integrity and effectiveness of the PBS.

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