EXPLANATORY STATEMENT
INSTRUMENT NUMBER PB 10 OF 2012
NATIONAL HEALTH ACT 1953
National Health (Listed drugs on F1 or F2) Amendment Determination 2012 (No.1)
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 one drug, linagliptin to F1. These changes are effective from
1 March 2012.
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.
Statement of Compatibility
This Determination is compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.
General
This instrument commences on 1 March 2012.
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 2012 (No. 1) was enacted under the authority of the National Health Act 1953 and is designed to address the need for a structured and efficient allocation of drugs to the Pharmaceutical Benefits Scheme (PBS) formularies, specifically F1 and F2. This instrument amends the National Health (Listed drugs on F1 or F2) Determination 2010 to facilitate the allocation process by which the Minister for Health determines which drugs are to be placed on F1 (for single brand drugs) or F2 (for drugs with multiple brands or in therapeutic groups with other multiple brand drugs). The determination is effective from 1 March 2012, and it includes the addition of linagliptin to the F1 formulary. The process of determining the placement of drugs on the PBS formularies involves consultation with relevant pharmaceutical companies and recommendations from the Pharmaceutical Benefits Advisory Committee, ensuring a thorough evaluation before any changes are implemented. This legislative instrument is compatible with human rights and freedoms as outlined in international instruments and is a legislative instrument under the Legislative Instruments Act 2003.
Scope and Application
The National Health (Listed drugs on F1 or F2) Amendment Determination 2012 (No. 1) applies to the allocation of drugs within the Pharmaceutical Benefits Scheme (PBS), which is established under the National Health Act 1953. The Act governs the provision of pharmaceutical benefits by the Commonwealth, ensuring Australians have access to a range of medicines. This specific determination amends the National Health (Listed drugs on F1 or F2) Determination 2010 by adding linagliptin to the F1 formulary, effective from 1 March 2012. The F1 formulary is designated for single brand drugs, while F2 is for drugs with multiple brands or those in therapeutic groups with multiple brands, subject to statutory price reductions, price disclosure, and guaranteed supply provisions. The instrument is made under the authority of subsection 85AB(1) of the Act and is subject to consultation with relevant stakeholders, including pharmaceutical companies and the Pharmaceutical Benefits Advisory Committee. The determination is compatible with human rights and freedoms as recognised in international instruments and is considered a legislative instrument under the Legislative Instruments Act 2003.
Key Provisions
The National Health (Listed drugs on F1 or F2) Amendment Determination 2012 (No.1) amends the National Health (Listed drugs on F1 or F2) Determination 2010. It adds linagliptin to the list of drugs on F1, effective from 1 March 2012 (section 1). This amendment is made under subsection 85AB(1) of the National Health Act 1953 (section 2). The Act governs the allocation of drugs to the Pharmaceutical Benefits Scheme (PBS) formularies F1 and F2, with F1 designated for single brand drugs and F2 for drugs with multiple brands or in therapeutic groups with multiple brands (section 84AC). To be assigned to F1, a drug must meet specific criteria, such as the absence of bioequivalent or biosimilar listed brands and not having been on F2 the day before the determination (subsection 85AB(4)). A drug can only be assigned to F2 if it does not satisfy the criteria for F1 (subsection 85AB(3)). Combination drugs are exempt from this determination (subsection 85AB(5)(a)).
The Act imposes obligations on pharmaceutical companies and the Minister. Pharmaceutical companies must engage in consultations and respond to recommendations from the Pharmaceutical Benefits Advisory Committee (PBAC) before drugs are listed and allocated to formularies (section 3). The Minister, under subsection 85AB(1), has the authority to determine that a listed drug is on F1 or F2 through a legislative instrument. This determination process ensures that drugs are appropriately categorised based on their therapeutic and market characteristics, facilitating the efficient operation of the PBS.
The Act does not explicitly detail offences, penalties, or consequences for non-compliance with the drug listing and allocation provisions. However, non-compliance with the determinations or obligations under the National Health Act 1953 could potentially lead to administrative or legal consequences, as the Act's provisions are integral to the administration of the PBS. The Act's overarching framework ensures that drugs are accessible and affordable, and any breach of these provisions might result in challenges to the PBS's integrity and the potential for corrective actions by the relevant authorities.