EXPLANATORY STATEMENT
NATIONAL HEALTH ACT 1953
DETERMINATION UNDER SUBSECTION 85B(1)
NO. PB 41 OF 2006
Purpose and operation
- The purpose of the Australian Pharmaceutical Benefits Scheme (PBS) is to provide timely, reliable and affordable access for the Australian community to necessary and cost-effective medicines.
2. The PBS is regulated by Part VII of the National Health Act 1953 (the Act), which provides for the supply of listed drugs and medicinal preparations as pharmaceutical benefits.
3. “Pharmaceutical benefit” is defined under subsection 84(1) of the Act as a drug or medicinal preparation in relation to which, by virtue of section 85 of the Act, Part VII of the Act applies.
4. Subsection 85B(1) of the Act enables the Minister to determine those pharmaceutical benefits for which there exists a price difference between what the Government is prepared to subsidise and that required by the manufacturer, and to determine in respect of each of those benefits the price to pharmacist which is to be used as a basis for reimbursement and the price to pharmacist sought by the manufacturer. Section 85B is used for special patient contribution items, for the therapeutic group premium policy and for the brand premium policy.
5. The determination sets out the conditions under which subsection 85B(1) applies. The Schedule to the determination lists those pharmaceutical benefits to which subsection 85B(1) applies, the form (strength, type, size etc.), the brand, the pack size, the price to pharmacist that the Government is prepared to pay and the price to pharmacist that the manufacturer requires.
6. The determination made under section 85B(1) of the Act on 26 July 2006 with effect from 1 August 2006 (No. PB 34 of 2006) is repealed and substituted with this determination.
7. This determination is remade to give effect, as from 1 October 2006, to changes to the list of drugs and medicinal preparations available as pharmaceutical benefits, as recommended by the Pharmaceutical Benefits Committee.
8. A Special Patient Contribution (SPC) came into effect for Lansoprazole, sachet containing granules for oral suspension, 30 mg per sachet, from 1 April 2006. Paragraph 8 of the current determination provides for a temporary exemption to the SPC to apply for this item if the prescription was both written before 1 April 2006 and dispensed prior to 1 October 2006. Accordingly, this temporary SPC exemption ceases on 1 October 2006.
9. An SPC will come into effect for Amoxycillin Trihydrate with Water – Purified BP, powder for paediatric oral drops equivalent to 100 mg amoxycillin per mL, 20 mL, from 1 October 2006. Paragraph 8 of the current determination will provide for a temporary exemption to the SPC to apply for this item if the prescription was both written before 1 October 2006 and dispensed prior to 1 December 2006. It is therefore necessary to remake this determination to amend paragraph 8 with effect from 1 October 2006.
10. Further amendment to the determination is necessary to take account of changes in therapeutic group premiums and SPCs as detailed in the attached summary of changes.
Consultations
11. 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. Under subsection 101(4) of the Act, a drug or medicinal preparation may not be declared to be a drug or medicinal preparation to which Part VII of the Act applies unless the PBAC has recommended that it be so declared. When recommending a medicine be listed 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.
12. The determination gives effect to recommendations made by the PBAC. PBAC members are selected 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.
13. Details of the determination are set out in the Attachment.
14. This determination is a legislative instrument for the purposes of the
Legislative Instruments Act 2003.
15. The determination was made on 21 September 2006 and commenced on
1 October 2006.
SUMMARY OF CHANGES
Brands with an increased therapeutic group premium
Ranitidine Hydrochloride Tablet, effervescent, equivalent to 150 mg ranitidine (GK)
Brands to which a special patient contribution now applies
Amoxycillin Trihydrate Powder for paediatric oral drops equivalent to 100 mg
with Water – Purified BP amoxycillin per mL, 20 mL (GK)
ATTACHMENT
Paragraph 1 provides that this determination commences on 1 October 2006.
Paragraph 2 provides that the determination under subsection 85B(1) of the National Health Act 1953 made on 26 July 2006 (No. PB 34 of 2006) is repealed.
Paragraph 3 defines the term “authority prescription”.
Paragraph 4 provides that the Schedule to the determination lists those brands of pharmaceutical benefits to which subsection 85B(1) apply.
Paragraph 5 provides that where a form and brand of pharmaceutical benefit is listed in Part A of the Schedule, Part B of the Schedule lists the quantity or number of units that is to be used for determining the manufacturer’s price for sales, and the price claimed by the manufacturer, for that form and brand.
Paragraph 6 provides that Part C of the Schedule lists the manufacturer’s price for sales for a particular form and brand that is listed in Part A of the Schedule.
Paragraph 7 provides that Part D of the Schedule lists the price claimed by the manufacturer for a particular form and brand that is listed in Part A of the Schedule.
Paragraph 8 lists those pharmaceutical benefits for which section 85B of the Act will not apply, if the prescription was written before 1 October 2006 and the pharmaceutical benefit is supplied before 1 December 2006.
Paragraph 9 lists the names of the manufacturers of those brands of pharmaceutical benefits, listed under “Brand” in Part A of the Schedule, to which this determination applies.
The Schedule to the determination lists those pharmaceutical benefits to which subsection 85B(1) applies, the form (strength, type, size etc.), the brand, the pack size, the price to pharmacist that the Government is prepared to pay and the price to pharmacist that the manufacturer requires.