EXPLANATORY STATEMENT
INSTRUMENT NUMBER PB 90 OF 2011
NATIONAL HEALTH ACT 1953
National Health (Listed drugs on F1 or F2) Amendment Determination 2011 (No.12)
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. 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 or F2 if there is a determination in force under section 85AB that the drug is on F1 or F2.
Subsection 85AB(1) 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(subsection 85AB(3)).
Section 85AB(5)(a) determines that if a drug is in a combination item that section 85AB does not apply. This means while there is only a single brand combination drug on the PBS, the item would remain on the combination drug list. When a second brand of the combination drug lists on the PBS, this would move the combination drug from the combination drug list to F2.
Details of this Instrument
PB 93 of 2010 maintains a list of all F1 and F2 drugs that are currently listed on the PBS. This instrument adds five drugs: asenapine, corifollitropin alfa, indacaterol, losartan and magnesium to F1 and removes two drugs; dexamethasone and temozolamide from F1 and places them on F2. One drug, thiotepa is delisting from the PBS so will also be removed from F1. These changes are effective from 1 December 2011.
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, and a recommendation is received from the Pharmaceutical Benefits Advisory Committee (PBAC). Any 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 2011.
This instrument constitutes a legislative instrument for the purpose of the
Legislative Instruments Act 2003.
Overview
The National Health (Listed drugs on F1 or F2) Amendment Determination 2011 (No.12), enacted under the National Health Act 1953, aims to address the allocation of drugs to the F1 and F2 formularies within the Pharmaceutical Benefits Scheme (PBS). This legislation, introduced by the Parliament, seeks to ensure reliable, timely, and affordable access to medicines for all Australians by allowing the Minister to determine which listed drugs are allocated to F1 (single brand drugs) or F2 (drugs with multiple brands or in a therapeutic group with other drugs with multiple brands). The policy objective is to manage the cost and supply of medicines under the PBS by subjecting F2 drugs to statutory price reductions, price disclosure, and supply guarantees. The amendment adds five drugs to F1 and removes two drugs from F1 to F2, while also delisting one drug from the PBS, effective from 1 December 2011. The process involves consultation with pharmaceutical companies and recommendations from the Pharmaceutical Benefits Advisory Committee, which includes representatives from consumer groups, health economists, pharmacists, general practitioners, and medical specialists.
Scope and Application
The National Health (Listed drugs on F1 or F2) Amendment Determination 2011 (No. 12) applies to the allocation of drugs to the F1 and F2 formularies for the Pharmaceutical Benefits Scheme (PBS) under the National Health Act 1953. This instrument, made by the Minister for Health, amends the National Health (Listed drugs on F1 or F2) Determination 2010 to add and remove specific drugs from these formularies. The changes, effective from 1 December 2011, include adding asenapine, corifollitropin alfa, indacaterol, losartan and magnesium to F1, and moving dexamethasone and temozolamide from F1 to F2. Thiotepa is delisted from the PBS and removed from F1. The determination extends to the Commonwealth level, affecting pharmaceutical companies with medicines listed on the PBS, and is made following consultations with the Pharmaceutical Benefits Advisory Committee (PBAC) and submissions from affected companies. The instrument constitutes a legislative instrument under the Legislative Instruments Act 2003.
Key Provisions
The primary operative sections of the National Health (Listed drugs on F1 or F2) Amendment Determination 2011 (No.12) are those that amend the National Health (Listed drugs on F1 or F2) Determination 2010. This amendment instrument adds five drugs—asenapine, corifollitropin alfa, indacaterol, losartan, and magnesium—to the F1 formulary, which is reserved for single brand drugs, and removes two drugs—dexamethasone and temozolomide—from F1, placing them on F2, which is designated for drugs with multiple brands or those in a therapeutic group with other multiple brand drugs. Additionally, thiotepa is delisted from the PBS and thus removed from F1. These changes are set to take effect from 1 December 2011.
The Act imposes specific obligations on parties involved with the Pharmaceutical Benefits Scheme (PBS). Pharmaceutical companies must ensure their drugs meet the criteria for inclusion in the appropriate formulary, either F1 or F2. This includes satisfying the criteria set out in subsection 85AB(4) of the National Health Act 1953 for F1 inclusion or complying with the provisions for F2. Additionally, the Minister must make determinations about which drugs are placed on F1 or F2 based on these criteria, as outlined in subsection 85AB(1). The Pharmaceutical Benefits Advisory Committee (PBAC) plays a crucial role in this process by providing recommendations following detailed consultations and considering submissions from pharmaceutical companies.
Breaches of the provisions under the National Health Act 1953 can lead to various consequences, including civil and criminal penalties. While the specific penalties for non-compliance are not detailed in the Explanatory Statement, it is understood that contraventions of the Act can result in substantial fines and potential imprisonment. The exact penalties would be determined in accordance with the broader legal framework governing the PBS and related legislation.
The National Health (Listed drugs on F1 or F2) Amendment Determination 2011 (No.12) ensures that the PBS remains effective in providing timely and affordable access to medications by updating the list of drugs on F1 and F2. The changes reflect careful consideration and consultation with relevant stakeholders, ensuring the PBS continues to meet the healthcare needs of Australians. The instrument is set to commence on 1 December 2011, and it constitutes a legislative instrument under the Legislative Instruments Act 2003.