National Health (Listed drugs on F1 or F2) Amendment Determination 2020 (No. 7) (PB 73 of 2020)

Administered by Department of Health, Disability and Ageing

Legislation au F2020L00976 Not in force Legislative Instrument

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  EXPLANATORY STATEMENT

 

National Health Act 1953

 

National Health (Listed drugs on F1 or F2) Amendment Determination 2020 (No. 7)

 

PB 73 of 2020

 

Authority

 

This instrument, made under subsection 85AB(1) and section 99AEJ 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).

 

Subsection 33(3) of the Acts Interpretation Act 1901 provides that where an Act confers a power to make, grant or issue any instrument of a legislative or administrative character (including rules, regulations or by-laws), the power shall be construed as including a power exercisable in the like manner and subject to the like conditions (if any) to repeal, rescind, revoke, amend, or vary any such instrument.

 

Purpose

 

This instrument makes amendments to the Principal Determination.

 

The Principal Determination provides for the allocation of drugs to the F1 and F2 formularies of the Pharmaceutical Benefits Scheme (PBS).

 

Background

 

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 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 removes one drug from F2, mercaptopurine and places it back on F1 under section 99AEJ of the Act . Under section 99AEH of the Act, on 1 August 2020 the Minister’s delegate revoked the determination under subsection 85(6) of the Act in relation to MERCAPTOPURINE-LINK (the delisted brand) of a pharmaceutical item, mercaptopurine, tablet containing mercaptopurine monohydrate 50 mg, oral (the existing item). Before the revocation came into force, subsection 99AEC(2) applied to the delisted brand of the existing item. From 1 August 2020, there is only one listed brand of mercaptopurine, tablet containing mercaptopurine monohydrate 50 mg, oral (the remaining item) that is bioequivalent or biosimilar to the delisted brand of the existing item. Apart from paragraph 85AB(4)(c) of the Act, mercaptopurine satisfies the criteria for F1 referred to in subsection 85AB(4) of the Act. Further, mercaptopurine was on F1 the day before subsection 99AEC(2) began to apply to the delisted brand of the existing item (on 31 March 2020).

 

This Instrument also amends the Principal Determination by adding to F1 three new drugs entrectinib, lorlatinib and stiripentol.  It also moves two currently listed drugs, lurasidone and nitrofurantoin from F1 to F2 in addition to moving one currently listed drug, levodopda with carbidopa and entacapone from the single brand Combination Drug List (CDL) to F2.  

 

 

Consultation

 

This Instrument affects pharmaceutical companies with new medicines listing on the PBS.  Entrectinib, lorlatinib and stiripentol all meet the criteria for F1 set out in section 85AB(4) of the Act.

 

Lurasidone, nitrofurantoin and levodopa with carbidopa and entacapone no longer meet the criteria for F1 set out in section 85AB(4) of the Act so are required to be moved to F2.   

 

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 a submission made by the affected pharmaceutical company. 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 responsible persons (manufacturers) for the delisted brand and the existing item were consulted about mercaptopurine moving from F2 to F1.

 

No additional consultations with experts was undertaken regarding this determination because consultation with the affected responsible persons and the PBAC drew on the knowledge of persons with relevant expertise.

 

Commencement

 

This Instrument commences on 1 August 2020.

 

This Instrument constitutes a legislative instrument for the purpose of the
Legislation Act 2003.

 

Statement of Compatibility with Human Rights

Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011

National Health (Listed Drugs on F1 or F2) Amendment Determination 2020 (No. 7)
(PB 73 of 2020)

This Legislative Instrument is compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.

Overview of the Legislative Instrument

This Legislative Instrument is made pursuant to subsection 85AB(1) and section 99AEJ of the National Health Act 1953 (the Act), which relates to listed drugs on F1 or F2.  This Instrument amends the National Health (Listed drugs on F1 or F2) Determination 2010 (PB 93 of 2010) (the Principal Determination). which provides for the allocation of drugs to the F1 and F2 formularies of the Pharmaceutical Benefits Scheme (PBS).

 

This Instrument amends the Principal Determination by adding to F1 three new drugs entrectinib, lorlatinib and stiripentol.  It also moves two currently listed drugs, lurasidone and nitrofurantoin from F1 to F2 in addition to moving one currently listed drug, levodopda with carbidopa and entacapone from the single brand Combination Drug List (CDL) to F2.  In addition, it also removes one drug from F2, mercaptopurine and places it back on F1 under section 99AEJ of the Act.

 

Human rights implications

This Legislative Instrument engages Article 2 and 12 of the International Covenant on Economic, Social and Cultural Rights (ICESCR) by assisting with the progressive realisation by all appropriate means of the right of everyone to the enjoyment of the highest attainable standard of physical and mental health.

The PBS is a benefit scheme which assists with advancement of this human right by providing for subsidised access by patients to medicines. The recommendatory role of the Pharmaceutical Benefits Advisory Committee (PBAC) ensures that decisions about subsidised access to medicines on the PBS are evidence-based.

Conclusion

This Legislative Instrument is compatible with human rights.  Human rights continue to be protected by retaining on the PBS clinically important medicines and placing them in formularies that ensure the most cost effective pricing for supply of each medicine to Australians.

 

 

Nikolai Tsyganov

  Acting Assistant Secretary

Pricing and PBS Policy Branch

Technology Assessment and Access Division

Department of Health

 

Overview

The National Health (Listed drugs on F1 or F2) Amendment Determination 2020 (No. 7) amends the National Health (Listed drugs on F1 or F2) Determination 2010, which pertains to the allocation of drugs to the F1 and F2 formularies within the Pharmaceutical Benefits Scheme (PBS). This instrument, enacted under the National Health Act 1953, is intended to address the need for the periodic review and adjustment of drug placements in the PBS formularies to ensure they remain aligned with the therapeutic and economic criteria set forth in the Act. This amendment is made by the Minister for Health or their delegate, reflecting the policy objective of maintaining an effective and efficient PBS that provides Australians with access to affordable and high-quality medicines. The changes include the addition of three new drugs to the F1 list, the reclassification of two drugs from F1 to F2, and the relocation of one drug from F2 to F1, all based on their therapeutic groups, brand equivalency, and the criteria set out in the Act. The determination process involved consultations with relevant stakeholders, including pharmaceutical companies and the Pharmaceutical Benefits Advisory Committee, ensuring that the amendments are evidence-based and consider the clinical and economic implications for the PBS. This instrument commenced on 1 August 2020, and it is compatible with the human rights recognised in international instruments, particularly those relating to the right to the highest attainable standard of physical and mental health. The amendments aim to optimise the cost-effectiveness and accessibility of medications under the PBS, thereby supporting the broader goal of public health improvement in Australia.

Scope and Application

The National Health (Listed drugs on F1 or F2) Amendment Determination 2020 (No. 7) amends the National Health (Listed drugs on F1 or F2) Determination 2010, which governs the allocation of drugs to the F1 and F2 formularies of the Pharmaceutical Benefits Scheme (PBS). This legislative instrument applies to pharmaceutical companies with new medicines listed on the PBS and affects the categorisation of specific drugs to either F1 or F2 formularies. F1 is designated for single brand drugs and F2 for drugs with multiple brands or in therapeutic groups with multiple brands. Drugs on F2 are subject to price disclosure and supply guarantee provisions. The amendment determination removes mercaptopurine from F2 and places it back on F1, while also adding three new drugs—entrectinib, lorlatinib, and stiripentol—to F1. It further moves lurasidone and nitrofurantoin from F1 to F2, and levodopa with carbidopa and entacapone from the single brand Combination Drug List to F2. The changes are effective from 1 August 2020 and are consistent with human rights by ensuring access to cost-effective medications and maintaining the highest attainable standard of health for Australians.

Key Provisions

The National Health (Listed drugs on F1 or F2) Amendment Determination 2020 (No. 7) (PB 73 of 2020) amends the National Health (Listed drugs on F1 or F2) Determination 2010 (PB 93 of 2010) under the National Health Act 1953 (the Act). This legislative instrument adjusts the allocation of drugs to the F1 and F2 formularies of the Pharmaceutical Benefits Scheme (PBS) by adding three new drugs to F1 and moving three existing drugs to F2. Specifically, entrectinib, lorlatinib, and stiripentol are added to F1, while lurasidone, nitrofurantoin, and levodopa with carbidopa and entacapone are moved to F2. Additionally, mercaptopurine is removed from F2 and placed back on F1. These changes are intended to align with the criteria set out in the Act for the classification of drugs in the PBS. The Act imposes several obligations on the parties involved in the PBS, including the Minister, who has the authority to make determinations regarding the classification of drugs. Pharmaceutical companies must comply with the criteria for listing their drugs on the PBS, including meeting the specific criteria for F1 or F2 classification. The Pharmaceutical Benefits Advisory Committee (PBAC) plays a key role in providing recommendations to the Minister, ensuring that decisions about drug subsidies are evidence-based and consider various health and economic factors. Responsible persons, such as manufacturers, must engage in consultations with the PBAC and the Department of Health when their drugs are being considered for listing or reclassification. Breaches of the requirements set out in the Act or the determinations made under it can lead to civil or criminal penalties. For instance, if a pharmaceutical company fails to comply with the criteria for listing or reclassification of drugs, it may face enforcement actions. While the determination itself does not specify particular penalties for non-compliance, general provisions in the Act may apply, which could include fines or other administrative actions. It is important for pharmaceutical companies and other stakeholders to adhere to the legislative and regulatory requirements to avoid potential consequences. This legislative instrument is designed to ensure that the PBS continues to provide access to essential medicines in a cost-effective manner. By classifying drugs appropriately and regularly reviewing their status, the Act aims to balance the need for affordable access to medicines with the sustainability of the PBS. The amendments in this determination reflect ongoing efforts to refine the scheme and ensure that it meets the health needs of Australians while managing costs effectively.

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