EXPLANATORY STATEMENT
National Health Act 1953
National Health (Listed drugs on F1 or F2) Amendment Determination 2016 (No. 4)
PB 37 of 2016
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 first new brand 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 single brand drugs; bendamustine and nivolumab to F1. It also moves one already PBS listed drug, esomeprazole and clarithromycin and amoxycillin, from the single brand Combination Drug List (CDL) to F2 because a new bioequivalent brand has listed for the drug. In addition, it removes the drugs electrolyte replacement solution; glycerol; and tiludronic acid from F1 and aluminium hydroxide with magnesium hydroxide; glucose; sodium chloride; and sodium lactate compound from F2 because these drugs are no longer PBS listed.
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 May 2016.
This Instrument constitutes a legislative instrument for the purpose of the
Legislation Act 2003.
Overview
The National Health (Listed drugs on F1 or F2) Amendment Determination 2016 (No. 4) amends the National Health (Listed drugs on F1 or F2) Determination 2010 to adjust the allocation of drugs within the Pharmaceutical Benefits Scheme (PBS) formularies. Enacted under the authority of the National Health Act 1953, this legislative instrument seeks to address the need for an efficient and equitable allocation of drugs within the PBS by modifying the placement of specific drugs between the F1 and F2 formularies. The policy objective is to ensure that the PBS formularies remain reflective of current therapeutic needs, market conditions, and the availability of bioequivalent or biosimilar drugs. The determination was made following consultations with relevant stakeholders, including pharmaceutical companies, and recommendations from the Pharmaceutical Benefits Advisory Committee.
Scope and Application
The National Health (Listed Drugs on F1 or F2) Amendment Determination 2016 (No. 4) is a legislative instrument made under the National Health Act 1953, which aims to amend the National Health (Listed Drugs on F1 or F2) Determination 2010. The Act applies to listed drugs and their allocation to the F1 and F2 formularies of the Pharmaceutical Benefits Scheme (PBS). F1 is designated for drugs with a single brand, while F2 is for drugs with multiple brands or those in a therapeutic group with other multiple-brand drugs. The amendment instrument adds bendamustine and nivolumab to F1 and moves esomeprazole and clarithromycin and amoxycillin from the single brand Combination Drug List to F2 due to the listing of a new bioequivalent brand. It also removes certain drugs from F1 and F2 because they are no longer listed on the PBS. The determination affects pharmaceutical companies with medicines listed on the PBS and is subject to consultation with the Pharmaceutical Benefits Advisory Committee, which includes representatives from various healthcare-related interests and professions. This instrument commences on 1 May 2016.
Key Provisions
The main operative sections of the National Health (Listed drugs on F1 or F2) Amendment Determination 2016 (No. 4) (the Amending Determination) are those that add, remove, or reclassify drugs within the Pharmaceutical Benefits Scheme (PBS) formularies. Section 2 of the Amending Determination adds bendamustine and nivolumab to F1, while section 3 moves esomeprazole and clarithromycin and amoxycillin from the Combination Drug List (CDL) to F2. Section 4 removes several drugs from their respective formularies due to their removal from the PBS list. These sections operate under the authority provided by section 85AB(1) of the National Health Act 1953 (the Act), which empowers the Minister to determine by legislative instrument the allocation of listed drugs to F1 or F2.
The Amending Determination imposes several obligations and requirements on the parties and entities it governs. Pharmaceutical companies with drugs listed on the PBS must comply with the new classifications as stipulated in the Amending Determination. The Department of Health, as the administrative body overseeing the PBS, must ensure that the new classifications are implemented and adhered to. Additionally, the Pharmaceutical Benefits Advisory Committee (PBAC) is required to provide recommendations on drug classifications based on consultations with relevant stakeholders, including pharmaceutical companies and health professionals. These obligations are necessary to maintain the integrity and efficacy of the PBS, ensuring that drugs are appropriately classified and accessible to patients.
The Amending Determination includes provisions that establish the consequences of non-compliance with its requirements. While specific offences and penalties are not detailed in the explanatory statement, breaches of the Act or its subsidiary legislation could result in civil or criminal penalties. Under section 84 of the Act, an offence is created for any person who contravenes a provision of the Act or any regulations or determinations made under it. The penalties for such offences can include fines, imprisonment, or both, depending on the severity of the breach and the discretion of the court. Additionally, failure to comply with the Act or its subsidiary legislation could result in the suspension or cancellation of a pharmaceutical company's PBS listing, impacting their ability to supply drugs to the Australian public.
In summary, the National Health (Listed drugs on F1 or F2) Amendment Determination 2016 (No. 4) serves to update the classification of drugs within the PBS formularies, aligning with the criteria set out in the National Health Act 1953. This legislative instrument imposes specific obligations on pharmaceutical companies and the Department of Health to ensure the proper implementation and adherence to these classifications. While the explanatory statement does not detail specific penalties for non-compliance, breaches of the Act or its subsidiary legislation could result in significant civil or criminal consequences, underscoring the importance of strict adherence to the provisions of the Amending Determination.