National Health Act 1953 - Amendment Determination under section 84AH (2011) (No. 5) (No. PB 91 of 2011)

Administered by Department of Health, Disability and Ageing

Legislation au F2011L02497 Not in force Legislative Instrument

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 EXPLANATORY STATEMENT

 

INSTRUMENT NUMBER PB 91 OF 2011

 

NATIONAL HEALTH ACT 1953

 

AMENDMENT DETERMINATION UNDER SECTION 84AH OF THE NATIONAL HEALTH ACT 1953 (2011) (No.5)

 

Purpose

 

The purpose of this legislative instrument, made under section 84AH of the National Health Act 1953 (“the Act”), is to amend the legislative instrument titled Determination under section 84AH of the National Health Act 1953 (as amended) (“PB 58 of 2007”) to make changes to the pharmaceutical items that are determined to be exempt items.

 

Background

 

Part VII of 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.

 

Drugs and medicinal preparations to which Part VII applies are declared as such by the Minister, by legislative instrument under subsection 85(2) of the Act. These are listed drugs (as defined in subsection 84(1)). The Minister may also determine by legislative instrument the form or forms of a listed drug by reference to strength, type of unit, size of unit or otherwise (subsection 85(3)) and the manner of administration of the form of the listed drug so determined (subsection 85(5)). If a drug has a declaration under subsection 85(2) in force in respect of it and determinations under subsections 85(3) and 85(5) in force in respect of it, then that declared drug in that determined form with that determined manner of administration is a pharmaceutical item. The Minister may also determine, by legislative instrument, brands of pharmaceutical items (subsection 85(6)).

 

Section 84AH empowers the Minister to determine, by legislative instrument, that a pharmaceutical item is an ‘exempt item’ if the pharmaceutical item satisfies the criteria in section 84AH. The criteria in section 84AH are as follows:

(a)   that there is only one listed brand of the relevant pharmaceutical item; and

(b)   there are no listed brands of other pharmaceutical items that are bioequivalent or biosimilar to the one listed brand of the relevant pharmaceutical item; and

(c)   there is at least one other pharmaceutical item that has the same listed drug as the relevant pharmaceutical item; and

(d)   the Minister is satisfied (having regard to advice, if any, from the Pharmaceutical Benefits Advisory Committee (“PBAC”)) that:

  1. the listed drug in the relevant pharmaceutical item represents suitable therapy for a particular patient population; and
  2. the relevant pharmaceutical item is suitable for use by a particular subgroup of that population because of either or both of the form and manner of administration; and
  3. no other pharmaceutical item that has that drug is suitable for use by the subgroup because of either or both of the form and manner of administration of the drug in that other item.

 

The effect of a pharmaceutical item being determined to be an exempt item is that the listed brand of that pharmaceutical item is excluded from statutory price reductions and price disclosure requirements under Division 3A and 3B of Part VII of the Act. The intention is to encourage the availability of certain pharmaceutical items with particular formulations of drugs that are used by a demographic subgroup (eg. children or geriatric patients) for whom other formulations of the drug are not suitable.

 

Changes to PB 58 of 2007 made by this instrument

 

This instrument makes the following changes to PB 58 of 2007:

  • one pharmaceutical item (listed drug = Lacosamide, form = Oral solution 15 mg per mL, 200 mL, manner of administration = Oral) is deleted from the list of exempt items following the manufacturer’s inability to supply.

Consultation

This instrument affects pharmaceutical companies with medicines listed on the PBS.  In relation to the introduction of the exempt items measure, which commenced on                      1 August 2007, pharmaceutical companies have been consulted during both the policy development and implementation phases.

The Pharmaceutical Benefits Advisory Committee (PBAC) was also consulted in relation to issues relevant to this determination.  The Pharmaceutical Benefits Advisory Committee (PBAC) is the independent expert body, established by section 100A of the Act, which makes recommendations to the Minister for Health and Ageing about which drugs and medicinal preparations should be available as pharmaceutical benefits and about other matters as required under the Act.  Under subsection 101(4AB) of the Act PBAC provides advice to the Minister if it is satisfied of certain matters concerning suitability of pharmaceutical items for use by particular sub-groups.  Consideration given by PBAC, under section 101(4AB), to the pharmaceutical items affected by the instrument, was considered by the delegate of the Minister who made the instrument.

General

The instrument commences on 1 December 2011. 

This instrument constitutes a legislative instrument for the purpose of the                Legislative Instruments Act 2003.

Overview

The National Health Act 1953, enacted by the Australian Parliament, serves as the foundational legislation for the Pharmaceutical Benefits Scheme (PBS), ensuring reliable, timely and affordable access to a wide range of medicines for all Australians. The 2011 Amendment Determination under Section 84AH of the National Health Act 1953 (No.5) was introduced to address the need for more specific exemptions within the PBS for certain pharmaceutical items that meet particular criteria. This amendment was made under the authority of the Act and aims to refine the list of exempt items to better suit the therapeutic needs of specific patient populations, particularly where certain formulations are more appropriate due to factors such as age or other medical considerations. The changes made by this instrument include the removal of a pharmaceutical item from the list of exempt items due to supply issues, reflecting the ongoing review process to ensure the PBS remains effective and responsive to the needs of the population it serves.

Scope and Application

The purpose of this legislative instrument, made under section 84AH of the National Health Act 1953, is to amend the Determination under section 84AH of the National Health Act 1953 (as amended) by making changes to the pharmaceutical items that are determined to be exempt items. The Act applies to pharmaceutical companies with medicines listed on the Pharmaceutical Benefits Scheme (PBS), which provides affordable access to a wide range of medicines for all Australians. The Act's jurisdictional reach is Commonwealth-wide, as it is enacted under the authority of the Commonwealth of Australia. The Act specifically targets pharmaceutical items that meet certain criteria to be determined as exempt items, which exclude these items from statutory price reductions and price disclosure requirements under the PBS. This instrument makes changes by deleting one pharmaceutical item from the list of exempt items due to the manufacturer's inability to supply, and it is effective from 1 December 2011. The Pharmaceutical Benefits Advisory Committee was consulted in relation to the pharmaceutical items affected by this instrument, providing advice to the Minister on the suitability of these items for use by particular sub-groups.

Key Provisions

The primary sections of the legislation, F2011L02497, pertain to the amendments made to the National Health Act 1953. Specifically, Section 84AH of the Act empowers the Minister to determine, through legislative instrument, whether a pharmaceutical item is an 'exempt item'. To qualify as an exempt item, the pharmaceutical item must satisfy certain criteria: there must be only one listed brand of the relevant pharmaceutical item (84AH(a)), there must be no listed brands of other pharmaceutical items that are bioequivalent or biosimilar (84AH(b)), and there must be at least one other pharmaceutical item that has the same listed drug (84AH(c)). Additionally, the Minister must be satisfied, based on advice from the Pharmaceutical Benefits Advisory Committee (PBAC), that the listed drug is suitable therapy for a particular patient population, the relevant pharmaceutical item is suitable for use by a particular subgroup of that population due to its form and manner of administration, and no other pharmaceutical item with the same drug is suitable for use by that subgroup for the same reasons (84AH(d)). The obligations imposed by this Act on the parties and entities it governs primarily concern the determination and listing of pharmaceutical items. Pharmaceutical companies must ensure that their pharmaceutical items meet the criteria for being listed as exempt items if they wish to be excluded from statutory price reductions and price disclosure requirements under Division 3A and 3B of Part VII of the Act. The Minister, in turn, is obliged to make determinations based on advice from the PBAC and to consult with relevant parties during the policy development and implementation phases. The PBAC, as the independent expert body, has the responsibility to provide advice to the Minister on the suitability of pharmaceutical items for particular patient sub-groups. The legislation outlines specific consequences for breaches, although it does not explicitly state maximum penalties. Non-compliance with the requirements of the Act, such as failing to meet the criteria for an exempt item or not adhering to the advice provided by the PBAC, could potentially result in civil or criminal penalties. These could include fines or other sanctions as prescribed by the relevant laws. The precise nature and extent of these penalties would be determined in the context of any legal proceedings arising from a breach of the Act. The Act also ensures that any legislative instrument made under it, such as this determination, constitutes a legislative instrument for the purposes of the Legislative Instruments Act 2003.

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