National Health Act 1953 - Amendment determination under subsection 85AB(1) - drugs on F1 (No. PB 51 of 2009)

Administered by Department of Health, Disability and Ageing

Legislation au F2009L02291 Not in force Legislative Instrument

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EXPLANATORY STATEMENT

 

 

INSTRUMENT NUMBER PB 51 OF 2009

 

 

NATIONAL HEALTH ACT 1953

 

 

AMENDMENT DETERMINATION UNDER SUBSECTION 85AB(1)

 

 

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 as such 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.

 

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 in relation to PBS reform by the National Health Amendment (Pharmaceutical Benefits Scheme) Act 2007 (the amending Act), which commenced on 1 August 2007. 

 

The Act provides for listed drugs to be assigned to formularies, identified as F1 and F2.  F1 is intended for single brand drugs, F2 for drugs that have multiple brands, or are interchangeable at the patient level with other drugs with multiple brands.  F2 is in turn divided into Part A and Part T, intended for drugs where price competition between brands is high.  Drugs on F2 are subject to the provisions of the Act relating to statutory price reductions (with different outcomes for Part A and Part T); price disclosure; and guarantee of supply.

 

Section 84AC relevantly provides that a drug is on F1 if determined to be so under section 85AB, or if prescribed to be so by regulations. A drug may also be determined to be on F1 under s99AEJ of the Act. A drug is on F2 if determined to be so under section 85AB, or prescribed to be so by the regulations.  Section 84AD provides that a drug is in Part A or Part T of F2 if determined to be so under section 85AC or if prescribed to be so in the regulations under subsection 85AD(5).  Subsections 84AC(5) and 84AD(5) provide that the regulations may, on the day on which section 84AC commenced, prescribe the matters referred.

 

Drugs on F1 and F2 (in Parts A and T) were prescribed with effect from 1 August 2007 in the National Health (Pharmaceutical Benefits) Regulations.

 

Subsection 85AB empowers the Minister to determine by legislative instrument that a listed drug is on F1 or F2.  For a drug to be on F1, it must satisfy the criteria in subsection 85AB(4). This requires that there are no listed brands of pharmaceutical items that have the drug, or another drug in the same therapeutic group, that are bioequivalent or biosimilar.  It also requires that the drug was not on the day before, on F2.  A drug may only be determined to be on F2 if it does not satisfy one or more of the criteria for F1.

 

This instrument amends instrument number PB 87 of 2007 by adding the listed drugs Arginine with carbohydrate”,Bevacizumab, “Etravirine” and “Mupirocinto F1.

 

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

 

The instrument is expressed to commence on 1 July 2009.

 

Consultations

This instrument affects pharmaceutical companies with medicines listed on the PBS.  Consultation has occurred through a company submission to the Therapeutic Goods Administration and the Pharmaceutical Benefits Advisory Committee for a drug to be listed on the PBS.  When drugs are listed on the PBS each drug is allocated into a formulary, F1, F2A or F2T from the recommendation of the PBAC. 

     
Attachment

 

 

Paragraph 1:  Provides that this instrument commences on 1 July 2009.

Paragraph 2:  Determines that Schedule 1 amends PB 87 of 2007.

Schedule 1:     Adds the listed drugs Arginine with carbohydrate”, “Bevacizumab, “Etravirine” and “Mupirocinto F1.              

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Overview

The National Health Amendment Determination under Subsection 85AB(1) (F2009L02291) was enacted in 2009 as a legislative instrument under the National Health Act 1953. This instrument aimed to address the need for updating the list of pharmaceutical benefits covered by the Pharmaceutical Benefits Scheme (PBS) by assigning certain listed drugs to specific formularies. The objective of this amendment was to ensure that the PBS continues to provide reliable, timely, and affordable access to a wide range of medicines for all Australians. The enacting body was the Minister for Health, who exercised their power under the Act to amend the Pharmaceutical Benefits by adding certain drugs to the F1 formulary, which is intended for single brand drugs where no bioequivalent or biosimilar brands exist. The instrument came into effect on 1 July 2009, and the process involved consultation with pharmaceutical companies and relevant advisory committees.

Scope and Application

The National Health Act 1953, as amended by the instrument F2009L02291, governs the Pharmaceutical Benefits Scheme (PBS) which ensures Australians have access to affordable medications. This legislation applies to pharmaceutical benefits, specifically listed drugs and certain extemporaneously-prepared medicinal preparations, declared by the Minister. These drugs are assigned to formularies, such as F1 and F2, which determine the level of statutory price reductions, price disclosure, and supply guarantees. Formulary F1 is for single-brand drugs where no bioequivalent or biosimilar brands exist in the same therapeutic group, whereas F2 is for drugs with multiple brands or those interchangeable with other multi-brand drugs, further divided into Parts A and T based on the level of price competition. The instrument F2009L02291 amends the previous instrument PB 87 of 2007 by adding specific drugs, namely “Arginine with carbohydrate”, “Bevacizumab”, “Etravirine”, and “Mupirocin”, to formulary F1, effective from 1 July 2009. This amendment affects pharmaceutical companies with medicines listed on the PBS, aligning with the criteria set forth in the Act and its regulations.

Key Provisions

The main sections of this legislation, particularly those referenced in the instrument number PB 51 of 2009, relate to the National Health Act 1953, focusing on amendments under subsection 85AB(1) to the Pharmaceutical Benefits Scheme (PBS) (subsection 85(1)). Specifically, this instrument adds certain drugs to the F1 formulary list (subsection 85AB). The declared drugs include "Arginine with carbohydrate", "Bevacizumab", "Etravirine", and "Mupirocin". These additions to the F1 formulary, which is intended for single brand drugs, are made by amending instrument number PB 87 of 2007. This amendment commenced on 1 July 2009, as stated in paragraph 1 of the instrument. The Act imposes several obligations on the parties involved in the PBS. Pharmaceutical companies must ensure that their drugs meet the criteria for inclusion in the F1 or F2 formularies. The Minister of Health has the authority to determine by legislative instrument whether a listed drug should be assigned to F1 or F2 based on specific criteria (subsection 85AB(4)). For a drug to be placed in F1, it must not have listed brands that are bioequivalent or biosimilar, and it must not have been on F2 previously. Conversely, a drug can only be assigned to F2 if it does not meet the criteria for F1. The regulations also provide for the assignment of drugs to either Part A or Part T within F2, depending on the level of price competition between brands (subsection 84AD(5)). There are no specific offences, penalties, or civil/criminal consequences outlined in this particular instrument for breach of the provisions. However, the general framework of the National Health Act 1953 does include provisions for penalties and enforcement mechanisms that could apply if there were breaches in other contexts related to the PBS. For example, general provisions under the Act might include fines or other penalties for non-compliance with regulations, but these are not detailed in the specific amendments described here.

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Area of Law
Pharmaceutical Law
Health Law
Instrument
Amending Act
Concepts
Definitions & Interpretation
Regulatory Standards
Pharmaceutical Benefits Scheme

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