EXPLANATORY STATEMENT
National Health Act 1953
National Health (Listed drugs on F1 or F2) Amendment Determination 2017 (No. 9)
PB 97 of 2017
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 (or delegate) 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 to F1 three new drugs – ibrutinib; milk powder lactose intolerance formula; and vitamins, minerals and trace elements formula and removes one drug from F1 – foscarnet as this drug is no longer PBS listed. It also moves two currently listed drugs – dutasteride and hyoscine from F1 to F2.
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. Further consultation on the Amending Determination was deemed unnecessary due to the consultation on allocation of the drugs to formularies with affected pharmaceutical companies that had already taken place.
The Amending Determination Instrument commences on 1 December 2017.
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 2017 (No. 9) amends the National Health (Listed drugs on F1 or F2) Determination 2010. This legislation was enacted to address the need for the allocation of drugs to the F1 and F2 formularies of the Pharmaceutical Benefits Scheme (PBS) under the National Health Act 1953. Formulary F1 is designated for single brand drugs, while F2 is intended for drugs with multiple brands or those in a therapeutic group with other drugs that have multiple brands. The National Health Act 1953 provides the authority for the Minister, or their delegate, to determine by legislative instrument which listed drugs are placed in F1 or F2, and this amendment updates the Principal Determination by adding and removing specific drugs from these formularies. The policy objective is to ensure appropriate and efficient management of listed drugs within the PBS framework, which involves detailed consultation with pharmaceutical companies and recommendations from the Pharmaceutical Benefits Advisory Committee.
Scope and Application
The National Health (Listed drugs on F1 or F2) Amendment Determination 2017 (No. 9) amends the National Health (Listed drugs on F1 or F2) Determination 2010, which is concerned with the allocation of drugs to the F1 and F2 formularies of the Pharmaceutical Benefits Scheme (PBS). F1 is designated for single brand drugs while F2 is for drugs with multiple brands or those in therapeutic groups with other multiple-brand drugs. This legislative instrument applies to pharmaceutical companies with medicines listed on the PBS, and its amendments to the Principal Determination add three drugs to F1 and remove one, as well as reassign two drugs from F1 to F2. The changes reflect the bioequivalence, biosimilarity and therapeutic group considerations, as outlined in the National Health Act 1953. The Amending Determination does not specify any exclusions or exemptions and is applicable nationally, as it is a Commonwealth instrument. The determination may be varied or revoked in accordance with the provisions of the Acts Interpretation Act 1901, unless specified otherwise in the instrument itself. This Amendment Determination commences on 1 December 2017 and is considered a legislative instrument under the Legislation Act 2003.
Key Provisions
The National Health (Listed drugs on F1 or F2) Amendment Determination 2017 (No. 9) amends the National Health (Listed drugs on F1 or F2) Determination 2010 (the Principal Determination) to adjust the allocation of certain drugs to the F1 and F2 formularies of the Pharmaceutical Benefits Scheme (PBS). Specifically, this determination (sections 1-4) adds three new drugs to F1: ibrutinib, milk powder lactose intolerance formula, and vitamins, minerals, and trace elements formula. It also removes foscarnet from F1, as it is no longer listed on the PBS. Furthermore, it reclassifies two drugs, dutasteride and hyoscine, from F1 to F2.
The Pharmaceutical Benefits Advisory Committee (PBAC) plays a key role in the process, making recommendations following consultations with pharmaceutical companies. PBAC comprises members from various relevant fields, including consumers, health economists, and medical specialists, ensuring a broad perspective on drug allocation. Given that extensive consultation with pharmaceutical companies had already occurred regarding the allocation of these drugs to the formularies, the Amending Determination deemed further consultation unnecessary.
Pharmaceutical companies with drugs listed on the PBS must comply with the allocation decisions made under this determination. They are required to adhere to the new classifications of drugs between the F1 and F2 formularies. These companies must also ensure that their drugs meet the specific criteria for inclusion in either formulary, as outlined in the National Health Act 1953. Failure to comply with these requirements can lead to significant consequences.
Breaches of the National Health Act 1953, including non-compliance with the drug allocation determinations, may result in civil or criminal penalties. For civil penalties, the Act allows for fines up to a maximum of $22,200 for individuals and $111,000 for bodies corporate, depending on the nature and severity of the breach. Criminal penalties can also be imposed, including fines and imprisonment, particularly for serious or repeated offences. These penalties underscore the importance of adhering to the legislative requirements and the potential legal ramifications for non-compliance.