EXPLANATORY STATEMENT
National Health Act 1953
National Health (Listed drugs on F1 or F2) Amendment Determination 2018 (No. 9)
PB 104 of 2018
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 four new drugs – benralizumab, ertugliflozin, midostaurin and trifluridine with tipiracil, in addition to moving one currently listed drug – tocilizumab 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 2018.
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 2018 (No. 9) amends the National Health (Listed drugs on F1 or F2) Determination 2010, which provides for the allocation of drugs to the F1 and F2 formularies of the Pharmaceutical Benefits Scheme (PBS). Enacted by the Australian Government under subsection 85AB(1) of the National Health Act 1953, this amendment aims to address the allocation of certain drugs to the appropriate formulary based on their brand status and therapeutic group. The National Health Act 1953 enables the Minister (or delegate) to determine by legislative instrument that a listed drug is on F1 or F2, with specific criteria to be met for each formulary. The policy objective is to ensure that drugs are appropriately categorised within the PBS, facilitating effective management and access to medications for the Australian public. This determination adds four new drugs to F1 and moves one drug from F1 to F2, reflecting decisions made after thorough consultation with pharmaceutical companies and the Pharmaceutical Benefits Advisory Committee.
Scope and Application
The National Health (Listed drugs on F1 or F2) Amendment Determination 2018 (No. 9) amends the National Health (Listed drugs on F1 or F2) Determination 2010, which is integral to the allocation of drugs to the F1 and F2 formularies of the Pharmaceutical Benefits Scheme (PBS). The F1 formulary is intended for single brand drugs, while F2 is designated for drugs that have multiple brands or are part of a therapeutic group with other drugs that have multiple brands. The Amending Determination specifically adds four new drugs to F1—benralizumab, ertugliflozin, midostaurin, and trifluridine with tipiracil—and moves tocilizumab from F1 to F2. This determination applies to pharmaceutical companies with medicines listed on the PBS, impacting their product allocations within the PBS framework. The determination was enacted under the authority of the National Health Act 1953 and became effective from 1 December 2018. It is noted that this Instrument constitutes a legislative instrument under the Legislation Act 2003.
Key Provisions
The primary sections of the National Health (Listed drugs on F1 or F2) Amendment Determination 2018 (No. 9) (the Amending Determination) pertain to the allocation of specific drugs to the F1 and F2 formularies of the Pharmaceutical Benefits Scheme (PBS). This involves adding four new drugs – benralizumab, ertugliflozin, midostaurin and trifluridine with tipiracil – to F1, and moving tocilizumab from F1 to F2. The F1 formulary is designated for single-brand drugs, while F2 is for drugs with multiple brands or those in a therapeutic group with multiple brands (sections 85AB(3) and 85AB(4)). Drugs on F2 are subject to provisions concerning first new brand statutory price reductions, price disclosure, and guarantee of supply (section 84AC).
Under the National Health Act 1953, the Amending Determination imposes obligations on pharmaceutical companies and other entities involved in the PBS. Pharmaceutical companies must ensure that the drugs they produce meet the criteria for placement in the relevant formulary, as determined by the Minister (or delegate) under section 85AB(1). These criteria include the absence of bioequivalent or biosimilar brands and the drug’s prior placement in the formularies (subsection 85AB(4)). Additionally, the Amending Determination requires the Pharmaceutical Benefits Advisory Committee (PBAC) to provide recommendations based on detailed submissions from affected pharmaceutical companies, ensuring that the interests of consumers, health economists, practising community pharmacists, general practitioners, clinical pharmacologists, and medical specialists are considered (subsection 85AB(5)).
There are specific penalties and consequences for non-compliance with the requirements outlined in the Amending Determination. While the Act does not detail specific penalties within the Explanatory Statement, breaches of the determination could potentially lead to civil or criminal liabilities under the National Health Act 1953 or other applicable legislation. The consequences might include financial penalties, legal action, or other administrative measures deemed appropriate by the relevant authorities. Given that this is a legislative instrument under the Legislation Act 2003, non-compliance may also attract further scrutiny and enforcement actions as prescribed by the relevant laws.