EXPLANATORY STATEMENT
National Health Act 1953
National Health (Listed drugs on F1 or F2) Amendment Determination 2020 (No. 5)
PB 48 of 2020
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; amino acid formula with carbohydrate without phenylalanine; amino acid formula with fat, carbohydrate without methionine; amino acid formula with fat, carbohydrate without phenylalanine and tyrosine; and amino acid formula with fat, carbohydrate without valine, leucine and isoleucine. It also moves one currently listed drug dutasteride with tamsulosin from the single brand administrative Combination Drug List (CDL) to F2. In addition, it also removes one drug from F1, oxytocin 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 new medicines listing on the PBS. Amino acid formula with carbohydrate without phenylalanine; amino acid formula with fat, carbohydrate without methionine; amino acid formula with fat, carbohydrate without phenylalanine and tyrosine; and amino acid formula with fat, carbohydrate without valine, leucine and isoleucine all meet the criteria for F1 set out in section 85AB(4) of the Act. Dutasteride with tamsulosin no longer meets the criteria for CDL and is required to be moved to F2. Oxytocin is being removed from the PBS at the request of the pharmaceutical company. Before the drugs were listed and allocated to formularies, there were detailed consultations about the drugs with the responsible persons, and a recommendation was 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 2020.
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 2020 (No. 5), made under the National Health Act 1953, amends the National Health (Listed drugs on F1 or F2) Determination 2010. This legislation seeks to address the allocation of drugs to the F1 and F2 formularies of the Pharmaceutical Benefits Scheme (PBS). The Act enables the Minister (or delegate) to determine by legislative instrument that a listed drug is on F1 or F2, with F1 intended for single brand drugs and F2 for drugs with multiple brands or in a therapeutic group with other drugs having multiple brands. This Amendment Determination, which comes into effect on 1 June 2020, adds four new drugs to F1 and moves one drug from the administrative Combination Drug List to F2, while also removing one drug from F1 as it is no longer listed on the PBS. This process involved consultation with pharmaceutical companies and a recommendation from the Pharmaceutical Benefits Advisory Committee.
Scope and Application
The National Health (Listed drugs on F1 or F2) Amendment Determination 2020 amends the National Health (Listed drugs on F1 or F2) Determination 2010, applying under the National Health Act 1953. This Act governs the allocation of listed drugs to formularies F1 and F2 within the Pharmaceutical Benefits Scheme (PBS), with F1 designated for single-brand drugs and F2 for those with multiple brands or in therapeutic groups with multiple brands. This Amendment Determination applies to pharmaceutical companies and affects the listed drugs that are now assigned to these formularies, with four new amino acid formulae added to F1 and one drug, dutasteride with tamsulosin, moved from the administrative Combination Drug List to F2. Furthermore, oxytocin has been removed from F1 due to it no longer being listed on the PBS. The amendment applies nationally across Australia, and its impact is felt directly by pharmaceutical entities involved in the PBS. The criteria for drug placement in F1 or F2 are strictly defined by the Act, and the changes are implemented following consultations with relevant stakeholders and recommendations from the Pharmaceutical Benefits Advisory Committee. The determination does not specify any exclusions or thresholds, and its provisions are enforced through the legislative framework established by the National Health Act 1953.
Key Provisions
The main operative sections of the National Health (Listed drugs on F1 or F2) Amendment Determination 2020 (No. 5) (the Amending Determination) amend the National Health (Listed drugs on F1 or F2) Determination 2010 by adding four new drugs to F1 and moving one drug from the single brand administrative Combination Drug List (CDL) to F2, as well as removing one drug from F1 (section 3). Specifically, four new amino acid formulas with various carbohydrate and fat compositions have been added to F1 (subsection 3(2)) and the drug dutasteride with tamsulosin has been moved from the CDL to F2 (subsection 3(3)). Oxytocin has been removed from F1 as it is no longer listed on the Pharmaceutical Benefits Scheme (PBS) (subsection 3(4)). These changes are in accordance with the criteria set out in the National Health Act 1953 (the Act) for allocation to F1 or F2 (section 85AB).
The Amending Determination imposes obligations on pharmaceutical companies with new medicines listed on the PBS. The four new amino acid formulas must now meet the criteria for F1 set out in section 85AB(4) of the Act. Dutasteride with tamsulosin must no longer meet the criteria for CDL and must be moved to F2. Oxytocin, being removed from the PBS, is no longer subject to F1 allocation. These changes necessitate compliance with the criteria specified in the Act and require adherence to the provisions of the PBS relating to first new brand statutory price reductions, price disclosure, and guarantee of supply for drugs on F2. Pharmaceutical companies must also ensure that their drugs meet the specific criteria for allocation to F1 or F2 as amended by the Amending Determination.
There are no specific offences, penalties, or consequences for breach outlined in the Amending Determination itself. However, non-compliance with the requirements of the Act and the PBS provisions may result in civil or criminal consequences under the broader legislative framework. For example, failure to comply with the pricing and supply requirements for drugs on F2 could potentially lead to enforcement actions by the Therapeutic Goods Administration (TGA) or other relevant authorities, with penalties including fines and other sanctions as provided under the Therapeutic Goods Act 1989. The maximum penalties for breaches of the Therapeutic Goods Act can vary widely depending on the specific offence and are subject to the provisions of that Act.