EXPLANATORY STATEMENT
National Health Act 1953
National Health (Listed drugs on F1 or F2) Amendment Determination 2014 (No. 4)
PB 43 of 2014
Authority
This Instrument, made under subsection 85AB(1) of the National Health Act 1953 (the Act), amends the National Health (Listed drugs on F1 or F2) Determination 2010 (PB 93 of 2010) (the Principal Determination).
The Principal Determination provides for the allocation of drugs to the F1 and F2 formularies of the Pharmaceutical Benefits Scheme (PBS).
Purpose
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 of the Act 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) of the Act 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)).
When subsection 85AB(5) of the Act applies, which relates to listed drugs with a single brand combination item on the PBS, the listed drug is not placed on F1 or F2, but on the administrative combination drug list.
This Instrument (the Amending Determination) amends the Principal Determination by adding two new listed drugs ferric carboxymaltose and tapentadol to F1.
Variation and revocation
Unless there is an express power to revoke or vary PB 93 of 2010 cited in this Instrument and explanatory statement, subsection 33(3) of the Acts Interpretation Act 1901 is relied upon to revoke or vary PB 93 of 2010.
Consultation
The Amending Determination 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.
The Amending Determination Instrument commences on 1 June 2014.
This Instrument constitutes a legislative instrument for the purpose of the
Legislative Instruments Act 2003.
Overview
The National Health Act 1953, enacted by the Commonwealth Parliament, is a foundational piece of Australian legislation that provides the legal framework for the administration of the Pharmaceutical Benefits Scheme (PBS). This Act addresses the need to regulate and provide access to medications in Australia, ensuring that the benefits of pharmaceuticals are accessible and affordable to the public. One of the key aspects of the Act is the allocation of drugs to different formularies, specifically F1 and F2, to manage the availability and pricing of pharmaceuticals effectively. The National Health (Listed drugs on F1 or F2) Amendment Determination 2014 (No. 4) amends the National Health (Listed drugs on F1 or F2) Determination 2010, updating the list of drugs assigned to F1 and F2 formularies. This determination was made under the authority of the Act to refine the allocation criteria and include new drugs, ferric carboxymaltose and tapentadol, into the F1 formulary. The policy objective behind these amendments is to ensure that the allocation of drugs to the appropriate formularies supports the efficient and equitable distribution of pharmaceutical benefits.
Scope and Application
The National Health (Listed drugs on F1 or F2) Amendment Determination 2014 applies to pharmaceutical companies with drugs listed on the Pharmaceutical Benefits Scheme (PBS) and is made under the authority of the National Health Act 1953. This legislation concerns the allocation of drugs to the F1 and F2 formularies of the PBS, with F1 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. The Act mandates that drugs on F2 are subject to statutory price reductions, price disclosure, and guarantee of supply provisions. The Amendment Determination specifically adds two new listed drugs, ferric carboxymaltose and tapentadol, to the F1 formulary. The application of this Act is nationwide, covering the entire Commonwealth of Australia. Any exclusions, exemptions, or thresholds are determined through the consultation process with pharmaceutical companies and recommendations from the Pharmaceutical Benefits Advisory Committee, which includes representatives from various health-related fields. The Amending Determination revokes and varies the Principal Determination under the authority of the Acts Interpretation Act 1901, unless expressly stated otherwise.
Key Provisions
The National Health (Listed drugs on F1 or F2) Amendment Determination 2014 (No. 4) (the Amendment) amends the National Health (Listed drugs on F1 or F2) Determination 2010 by adding two new drugs, ferric carboxymaltose and tapentadol, to the F1 formulary (section 2). This means that these drugs will now be available under the Pharmaceutical Benefits Scheme (PBS) with the associated benefits of being covered by the scheme, such as reduced costs for patients and the Australian government. The F1 formulary is designated for single brand drugs, and for these drugs to be placed there, they must meet specific criteria outlined in section 85AB(4) of the National Health Act 1953 (the Act). These criteria include the absence of bioequivalent or biosimilar listed brands for the drug or any other drug in the same therapeutic group.
The Amendment places an obligation on pharmaceutical companies to ensure that the drugs they produce and market are compliant with the updated formulary listings. These companies must also be aware of the pricing, supply, and disclosure requirements applicable to drugs listed on F2, as these provisions are referenced in the explanatory statement but do not apply directly to the drugs added to F1. The Minister for Health has the authority to determine the placement of drugs in these formularies under subsection 85AB(1) of the Act, and this Amendment reflects the Minister’s decision to place ferric carboxymaltose and tapentadol in F1.
The Amendment does not explicitly outline specific offences or penalties for non-compliance with the updated formulary listings. However, non-compliance with the provisions of the Act generally could result in various civil or criminal consequences, depending on the nature and severity of the breach. For example, misleading or deceptive conduct in relation to the supply of listed drugs could attract penalties under the Australian Consumer Law, which includes fines of up to $1.1 million for corporations and $220,000 for individuals. Additionally, any failure to comply with the statutory requirements for price disclosure or guarantee of supply could lead to enforcement actions by the Therapeutic Goods Administration or other relevant authorities. It is important for parties governed by the Act to adhere to the updated formulary listings and the associated requirements to avoid potential legal repercussions.