National Health Act 1953 - Amendment determination under section 84AH - exempt items (No. PB 79 of 2009)

Administered by Department of Health, Disability and Ageing

Legislation au F2009L03147 Not in force Legislative Instrument

Legislation content

EXPLANATORY STATEMENT

 

 

INSTRUMENT NUMBER PB 79 OF 2009

 

 

NATIONAL HEALTH ACT 1953

 

 

AMENDMENT DETERMINATION UNDER SECTION 84AH

 

 

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 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.

Certain provisions of the Act relating to brands of pharmaceutical items, including in relation to statutory price reductions, price disclosure, and guarantee of supply, are the result of amendments by the National Health Amendment (Pharmaceutical Benefits Scheme) Act 2007 (the amending Act), expressed to commence on 1 August 2007.  Included in these amendments is the insertion of section 84AH into the Act.

Section 84AH empowers the Minister by legislative instrument to determine that a pharmaceutical item is an “exempt item”.  This is permitted if there is only one listed brand of the pharmaceutical item; there are no listed brands of other pharmaceutical items that are bioequivalent or biosimilar; and the listed drug in the pharmaceutical item is common to at least one brand of another pharmaceutical item.  The Minister has also to be satisfied, having regard to any advice from the Pharmaceutical Benefits Advisory Committee (PBAC), that the listed drug in the relevant pharmaceutical item represents suitable therapy for a particular patient population; that the relevant item is suitable for use by a particular subgroup of that patient population because of either or both of the form and manner of administration of the drug in the item; and that no other pharmaceutical item that has that drug is suitable for use by that subgroup due to either or both of the form and manner of administration of the drug in that other item. 

Exempt items are excluded from the statutory price reductions and from price disclosure requirements under the Act.  The intention is to encourage availability of certain, and quite particular, pharmaceutical items by providing exemptions for particular formulations of drugs (eg oral solution) used by a demographic subgroup (eg children or geriatric patients) for whom other formulations of the drug are not suitable.

This legislative instrument amends the determination under section 84AH made by legislative instrument number PB 58 of 2007 which came into effect on 1 August 2007.  This instrument amends PB 58 of 2007 by determining under section 84AH that the ‘Sachet containing granules for oral suspension 30 mg per sachet’ form of the listed drug Lansoprazole, which is to be taken orally, is no longer an exempt item.

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

The instrument is expressed to commence on 1 September 2009.  The instrument is expressed to commence in this way so that the item determined to be no longer exempt by the instrument is now subject to statutory price reductions and any price disclosure obligations, including those occurring on 1 September 2009.

 

Consultations

This instrument affects pharmaceutical companies with medicines listed on the PBS.  In relation to the introduction of the exempt items measure in the National Health Amendment (Pharmaceutical Benefits Scheme) Act 2007, which commenced on 1 August 2007, pharmaceutical companies have been consulted during both the policy development and implementation phases.

The responsible person for the brand of the pharmaceutical item affected by this instrument has been consulted.

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.

 

 

 

 

ATTACHMENT

Paragraph 1: Provides that the instrument will commence on 1 September 2009.

Paragraph 2: Determines that Schedule 1 amends PB 58 of 2007.

Schedule 1: Provides for the following amendment:

 

 

Deletions

 

Lansoprazole Sachet containing granules for oral suspension 30 mg per sachet 

 

 

 

Overview

The National Health Act 1953, as amended, governs the Pharmaceutical Benefits Scheme (PBS) under which the Commonwealth provides reliable, timely, and affordable access to a wide range of medicines for all Australians. Section 84AH, introduced by the National Health Amendment (Pharmaceutical Benefits Scheme) Act 2007, empowers the Minister to determine that certain pharmaceutical items can be exempt from statutory price reductions and price disclosure requirements if specific conditions are met, such as when there is only one listed brand of the pharmaceutical item and it is suitable for a particular patient population due to its form and manner of administration. This legislative instrument, PB 79 of 2009, amends the determination made under section 84AH in PB 58 of 2007, by removing the exemption for the ‘Sachet containing granules for oral suspension 30 mg per sachet’ form of Lansoprazole, which will now be subject to statutory price reductions and price disclosure obligations. This amendment was made following consultations with pharmaceutical companies, the responsible person for the brand of the pharmaceutical item, and the Pharmaceutical Benefits Advisory Committee (PBAC). The instrument is set to commence on 1 September 2009 to ensure the item is subject to the relevant obligations from that date.

Scope and Application

The National Health Act 1953, as amended, provides the legislative foundation for the Pharmaceutical Benefits Scheme (PBS), which ensures Australians have access to a wide range of medicines at affordable prices. Part VII of the Act governs the PBS, and the Minister for Health can declare by legislative instrument the drugs and medicinal preparations that are subject to the scheme. This includes determining the form, manner of administration, and brands of pharmaceutical items listed under the scheme. The Act was further amended by the National Health Amendment (Pharmaceutical Benefits Scheme) Act 2007, which introduced provisions for the Minister to designate certain pharmaceutical items as "exempt items" if specific criteria are met, thereby excluding them from statutory price reductions and price disclosure requirements. The instrument in question amends a previous determination under section 84AH of the Act, removing the exemption for the 'Sachet containing granules for oral suspension 30 mg per sachet' form of Lansoprazole, effective from 1 September 2009, thus subjecting it to statutory price reductions and price disclosure obligations.

Key Provisions

The primary sections of the legislation in question pertain to the amendments made under section 84AH of the National Health Act 1953. Specifically, subsection 85(1) mandates that pharmaceutical benefits are provided by the Commonwealth in accordance with Part VII of the Act. Subsection 85(2) allows the Minister to declare by legislative instrument drugs and medicinal preparations that are subject to Part VII, which includes those listed under subsection 84(1). The amendments introduced by this instrument modify the status of certain pharmaceutical items under the Pharmaceutical Benefits Scheme (PBS). In this case, the instrument determines that the 'Sachet containing granules for oral suspension 30 mg per sachet' form of the listed drug Lansoprazole, intended for oral administration, is no longer classified as an 'exempt item' under section 84AH. The obligations imposed by the Act on the parties involved primarily concern the Minister's authority to determine the form, administration, and brand of pharmaceutical items under subsections 85(3), 85(5), and 85(6) respectively. These determinations are essential for governing what constitutes a pharmaceutical benefit under Part VII of the Act. Pharmaceutical companies must comply with these determinations and adhere to any amendments made by legislative instruments. Additionally, the Act requires the Minister to consider advice from the Pharmaceutical Benefits Advisory Committee (PBAC) before making certain determinations, ensuring that the suitability of pharmaceutical items for particular patient populations is adequately assessed. The legislation also outlines specific offences and penalties for non-compliance. Although the explanatory statement does not detail specific maximum penalties, breaches of the provisions could lead to statutory price reductions and price disclosure obligations for pharmaceutical items that are incorrectly classified or fail to meet the criteria set out by the Act. Failure to comply with these obligations could result in civil or criminal consequences, although the precise penalties are not explicitly stated in the provided text. The Minister's authority to make determinations under section 84AH is critical in ensuring that the PBS functions effectively, providing reliable access to affordable medicines for all Australians. Consultation with relevant stakeholders, including pharmaceutical companies and the PBAC, is a mandatory part of the legislative process. This ensures that the interests of all parties are considered when making determinations that affect the PBS. The PBAC's role in advising the Minister on the suitability of pharmaceutical items for particular patient subgroups underscores the importance of expert input in this regulatory framework. The instrument's commencement on 1 September 2009 ensures that the amended classification of the Lansoprazole sachet takes immediate effect, subjecting it to statutory price reductions and any applicable price disclosure requirements from that date.

Legal classification tags

Area of Law
Health Law
Instrument
Statutory Instrument
Concepts
Definitions & Interpretation
Regulatory Standards
Reporting & Disclosure Obligations
Prohibited Conduct

Interactions

Authorises

All Versions

Sourced from the Federal Register of Legislation at 26 August 2026. For the latest information on Australian Government law please go to https://www.legislation.gov.au.