EXPLANATORY STATEMENT
National Health Act 1953
National Health (Listed drugs on F1 or F2) Amendment Determination 2019 (No. 4)
PB 33 of 2019
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 – avelumab, inotuzumab ozogamicin, and palbociclib. It also removes one drug from F1 – clodronic acid as this drug is 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. 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 May 2019.
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 2019 (No. 4) was enacted to amend the National Health (Listed drugs on F1 or F2) Determination 2010, which allocates drugs to the F1 and F2 formularies of the Pharmaceutical Benefits Scheme (PBS). This amendment was introduced to address the need to update the list of drugs within the scheme to reflect current therapeutic needs and market conditions. Enacted by the Minister for Health under the authority granted by the National Health Act 1953, the policy objective of the amendment is to ensure that the PBS remains responsive to new medical treatments and technologies, while also maintaining cost-effectiveness and equitable access to pharmaceuticals for all Australians. This amendment specifically adds three new drugs to the F1 formulary and removes one drug that is no longer listed on the PBS, thereby reflecting the current market and ensuring the PBS continues to serve its purpose effectively.
Scope and Application
The National Health (Listed drugs on F1 or F2) Amendment Determination 2019 (No. 4) amends the National Health (Listed drugs on F1 or F2) Determination 2010, which allocates drugs to the F1 and F2 formularies of the Pharmaceutical Benefits Scheme (PBS). This determination applies to listed drugs, specifically those that are single brand drugs assigned to F1 and those that have multiple brands or are in a therapeutic group with other multiple brand drugs assigned to F2. The amendments include adding three new drugs to F1: avelumab, inotuzumab ozogamicin, and palbociclib, and removing clodronic acid from F1 as it is no longer listed on the PBS. The geographic reach of this Act is national, impacting pharmaceutical companies with medicines listed on the PBS across Australia. The Act does not explicitly state exclusions or exemptions but operates within the criteria for drug allocation to F1 and F2 as outlined in the National Health Act 1953. The application of the Act can be extended or restricted through subordinate instruments, with variations and revocations governed by the Acts Interpretation Act 1901, unless expressly stated otherwise.
Key Provisions
The National Health (Listed drugs on F1 or F2) Amendment Determination 2019 (No. 4) amends the National Health (Listed drugs on F1 or F2) Determination 2010, impacting the allocation of drugs to the F1 and F2 formularies of the Pharmaceutical Benefits Scheme (PBS) under the National Health Act 1953. Specifically, this determination adds three drugs—avelumab, inotuzumab ozogamicin, and palbociclib—to the F1 formulary, while removing clodronic acid from the F1 formulary due to its delisting from the PBS (sections 1 and 2). The F1 formulary is designated for drugs with a single brand, while the F2 formulary accommodates drugs with multiple brands or those in a therapeutic group with other drugs having multiple brands. This classification is pivotal as it governs aspects such as statutory price reductions, price disclosure, and supply guarantees for drugs on F2.
Under the National Health Act 1953, entities and individuals governed by this Act must adhere to the criteria for the allocation of drugs to the F1 and F2 formularies as stipulated by the Principal Determination and its amendments. Pharmaceutical companies must ensure that drugs they list on the PBS comply with the conditions for placement on either F1 or F2, as outlined in sections 85AB(3) to 85AB(5). The Minister, or their delegate, has the authority to make determinations under section 85AB(1), which are subject to consultation with affected pharmaceutical companies and recommendations from the Pharmaceutical Benefits Advisory Committee (PBAC). The PBAC, comprising representatives from various health-related fields, provides expert advice on the suitability of drugs for inclusion in the F1 or F2 formularies.
Failure to comply with the provisions of the National Health Act 1953 and the determinations made under it may result in significant legal consequences. While specific offences and penalties are not detailed in the explanatory statement, breaches of the Act can potentially lead to civil or criminal liabilities. The exact nature and extent of these penalties would depend on the specific provisions of the Act and related legislation, such as the Acts Interpretation Act 1901, which may provide for revocation or variation of previous determinations. The commencement date for this Amendment Determination is 1 May 2019, and it is recognised as a legislative instrument under the Legislation Act 2003.