EXPLANATORY STATEMENT
INSTRUMENT NUMBER PB 60 OF 2011
NATIONAL HEALTH ACT 1953
National Health (Listed drugs on F1 or F2) Amendment Determination 2011 (No.9)
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 three drugs, ferrous fumarate, fingolimod and zuclopenthixol decanoate to F1. This instrument also removes four drugs, amiloride, clotrimazole, neomycin and sulindac from F1. Zuclopenthixol decanoate was deleted from F1 in April 2011 but is relisting 1 September 2011 so needs to be placed back on F1. An administrative error is also being corrected to match the description of ferrous sulfate to that of the listing determination. These three changes are effective from 1 September 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 September 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. 9), made under subsection 85AB(1) of the National Health Act 1953, was enacted to amend the National Health (Listed Drugs on F1 or F2) Determination 2010. The Act, established by the Australian Parliament, serves as the legislative foundation for the Pharmaceutical Benefits Scheme (PBS), ensuring that all Australians have access to reliable, timely, and affordable medicines. This amendment specifically addresses the allocation of drugs to the F1 and F2 formularies within the PBS. The F1 formulary is intended for single brand drugs, whereas the F2 formulary is designated for drugs with multiple brands or those within a therapeutic group containing other drugs with multiple brands. The policy objective of this determination is to ensure that the allocation of drugs to these formularies is done in a manner that aligns with the overarching goals of the PBS, including maintaining affordability and accessibility of medications.
Consultations with pharmaceutical companies and recommendations from the Pharmaceutical Benefits Advisory Committee (PBAC) form part of the decision-making process for drug listing and allocation to formularies. The PBAC, comprising experts from various relevant fields, ensures that the recommendations are comprehensive and balanced, reflecting diverse interests. This amendment to the determination is effective from 1 September 2011, correcting previous administrative errors and updating the list of drugs on F1 to reflect current therapeutic needs and availability.
Scope and Application
The National Health (Listed drugs on F1 or F2) Amendment Determination 2011 (No.9) amends the National Health (Listed drugs on F1 or F2) Determination 2010, providing for the allocation of drugs to the F1 and F2 formularies within the Pharmaceutical Benefits Scheme (PBS) under the National Health Act 1953. This legislation applies to the Minister for Health, pharmaceutical companies, and listed drugs under the Act. The F1 formulary is designated for single-brand drugs, while F2 is for drugs with multiple brands or in therapeutic groups with multiple brands, and it includes statutory price reductions, price disclosure, and supply guarantees. The amendment adds three drugs to F1 and removes four, effective from 1 September 2011, and corrects an administrative error. This instrument operates nationally within the Commonwealth of Australia, and its implementation is subject to consultation with pharmaceutical companies and recommendations from the Pharmaceutical Benefits Advisory Committee. The changes outlined in this instrument are effective from 1 September 2011 and are made under the authority of the National Health Act 1953.
Key Provisions
The primary provisions of the National Health (Listed Drugs on F1 or F2) Amendment Determination 2011 (No. 9) involve amendments to the listing of drugs under the Pharmaceutical Benefits Scheme (PBS) (sections 1-3). This instrument amends the National Health (Listed Drugs on F1 or F2) Determination 2010, specifically altering the formularies F1 and F2 to which certain drugs are assigned. F1 is designated for single brand drugs, while F2 is for drugs with multiple brands or those in a therapeutic group with other multi-brand drugs. Drugs on F2 are subject to statutory price reductions, price disclosure, and guaranteed supply provisions. The instrument adds ferrous fumarate, fingolimod, and zuclopenthixol decanoate to F1, removes amiloride, clotrimazole, neomycin, and sulindac from F1, and corrects an administrative error regarding the description of ferrous sulfate to align with the listing determination. These changes take effect from 1 September 2011.
The obligations imposed by the Act on parties or entities include the requirement for drugs to meet specific criteria to be listed on F1 or F2 (section 4). For a drug to be placed on F1, it must not have any bioequivalent or biosimilar listed brands, nor should any drug in the same therapeutic group have such equivalents. The drug must also not have been on F2 the day before the determination takes effect. Conversely, a drug can only be placed on F2 if it does not satisfy the criteria for F1. The Minister's authority under section 85AB(1) to determine by legislative instrument the assignment of drugs to F1 or F2 is exercised through this instrument. Pharmaceutical companies and other stakeholders must engage in consultations and follow recommendations from the Pharmaceutical Benefits Advisory Committee (PBAC) before drugs are listed and assigned to formularies.
The instrument does not explicitly outline specific offences, penalties, or civil/criminal consequences for breaches. However, breaches of the National Health Act 1953, which governs the PBS, may result in various penalties depending on the nature of the breach. Typically, such breaches may attract civil penalties, criminal charges, or both, depending on the severity and intent behind the violation. The maximum penalties for offences under the National Health Act can include substantial fines and imprisonment, reflecting the seriousness with which the Act is enforced to ensure compliance and protect public health.