EXPLANATORY STATEMENT
INSTRUMENT NUMBER PB 112 OF 2010
NATIONAL HEALTH ACT 1953
National Health (Listed drugs on F1 or F2) Amendment Determination 2010
Purpose
This instrument, made under subsection 85AB(1) of the National Health Act 1953 (the Act), amends the principal determination, the National Health (Listed drugs on F1 or F2) Determination 2010 (PB 93 of 2010) to provide for allocation of drugs to the F1 and F2 formularies for the Pharmaceutical Benefits Scheme (PBS).
Background
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 under subsection 85(2). These are listed drugs as defined in subsection 84(1).
The Act provides that listed drugs may be assigned to formularies identified as F1 and F2. F1 is intended for single brand drugs, and F2 for drugs that have multiple brands, or are in a therapeutic group with other drugs with multiple brands. Until 1 December 2010, F2 has in turn been divided into Part A and Part T. Amendments to the Act, in the National Health Amendment (Pharmaceutical Benefits Scheme) Act 2010, commencing on 1 December 2010, bring forward the merger of the F2A and F2T formularies from 1 January 2011 to 1 December 2010. Drugs on F2 are subject to the provisions of the Act relating to statutory price reductions, price disclosure and guarantee of supply.
Section 84AC relevantly provides that a drug is on F1 if it is 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 it is determined to be so under section 85AB, or prescribed to be so by the regulations.
Drugs on the PBS as at 1 August 2007 were prescribed in the National Health (Pharmaceutical Benefits) Regulations 1960 (the Regulations) to be on F1 and F2 (and in Parts A and T of F2) with effect from 1 August 2007. However, from 11 October 2010 all formulary allocations were consolidated in legislative instruments made under subsections 85AB(1) and 85AC(1), and the provisions in the Regulations prescribing formulary allocations have been repealed as they were redundant.
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 that are bioequivalent or biosimilar, and no listed brands of pharmaceutical items that have another drug in the same therapeutic group as the first drug that are bioequivalent or biosimilar. It also requires that the drug was not on F2 the day before the determination comes into effect. A drug may only be determined to be on F2 if it does not satisfy one or more of the criteria for F1.
Details of this Instrument
This instrument places drugs into the F1 or F2 formulary for the PBS. It adds four drugs to F1, removes five drugs from F1 and places those five drugs into F2, and adds two drugs to F2 that had previously been on the combination drug list. The combination drugs list is for drugs that have no listed bioequivalent or biosimilar brands that have combination items - those drugs are not placed on either F1 or F2.
A provision-by-provision description of the instrument is contained in the Attachment.
Consultation
The instrument affects pharmaceutical companies with medicines listed on the PBS. Before drugs are listed and allocated to formularies, there are detailed consultations about the drug with the intended responsible person. Each drug may be allocated into F1 or F2 based on the recommendation of the Pharmaceutical Benefits Advisory Committee (PBAC). The PBAC recommendation is made following receipt of submissions by affected pharmaceutical companies. Two-thirds of the PBAC membership is from the following interests or professions: consumers, health economists, practising community pharmacists, general practitioners, clinical pharmacologists and medical specialists.
General
This instrument commences on 1 December 2010.
This instrument constitutes a legislative instrument for the purpose of the
Legislative Instruments Act 2003.
Attachment
Section 1 - Name of Determination
This section provides that the name of the determination is the National Health (Listed drugs on F1 or F2) Amendment Determination 2010, and that it may also be cited as PB 112 of 2010.
Section 2 - Commencement
This section provides that the instrument commences on 1 December 2010.
Section 3 - Amendment
This section provides that Schedule 1 amends the National Health (Listed drugs on F1 or F2) Determination 2010 (PB 93 of 2010), which determines drugs on F1 or F2 under subsection 85AB(1) of the National Health Act 1953.
Schedule 1 – Drugs on F1
Schedule 1 determines that the listed drugs cetrorelix, degarelix, denosumab and epoetin lambda be added to those determined to be on F1and also determines the removal of the listed drugs cefepime, granisetron, hydroxocobalamin, macrogol 3350 and tacrolimus from F1. The drugs removed from F1 have been added to F2.
Schedule 2 – Drugs on F2
Schedule 2 determines that the listed drugs alendronic acid with colecalciferol and calcium, cefepime, granisetron, hydroxocobalamin, macrogol 3350, omeprazole and clarithromycin and amoxicillin, and tacrolimus, be added to those determined to be on F2.