National Health (Originator Brand) Amendment Determination 2016 (No. 7) (PB 89 of 2016)

Overview

The National Health (Originator Brand) Amendment Determination 2016 (No. 7) amends the National Health (Originator Brand) Determination 2015 to determine the originator brand of a pharmaceutical item for a specific drug that has moved from the F1 to the F2 formulary within the Pharmaceutical Benefits Scheme (PBS). This determination is made under the National Health Act 1953 and is necessary to implement the removal of originator brand data from price disclosure calculations, which is set out in the National Health (Pharmaceutical Benefits) Regulations 1960. This amendment aims to potentially increase price disclosure-related price reductions as originator brands tend to maintain higher prices than other brands. The policy objective is to ensure that the PBS provides affordable access to necessary and cost-effective medicines for Australians. The instrument was enacted by the Australian Parliament and 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. This legislative instrument supports the progressive realisation of the right of everyone to the enjoyment of the highest attainable standard of physical and mental health, as provided for in Articles 2 and 12 of the International Covenant on Economic, Social and Cultural Rights. By removing originator brand data from price disclosure calculations, the PBS aims to deliver better value for money for PBS medicines through price reductions, which will assist consumers by reducing out-of-pocket costs for some PBS medicines.

Scope and Application

The National Health (Originator Brand) Amendment Determination 2016 (No. 7) is a legislative instrument made under the authority of subsection 99ADB(6B) of the National Health Act 1953. This instrument amends the National Health (Originator Brand) Determination 2015 to determine the originator brand of a pharmaceutical item for a specific drug newly added to the Pharmaceutical Benefits Scheme (PBS) F2 formulary, effective from 1 October 2016. The determination applies to pharmaceutical items that meet certain criteria, such as being listed on the F2 formulary and undergoing price disclosure. This amendment is crucial for implementing the removal of originator brand data from price disclosure calculations under the National Health (Pharmaceutical Benefits) Regulations 1960, potentially leading to increased price reductions and better value for consumers. The amendment applies nationally and is intended to enhance the efficiency of the PBS by ensuring that government prices more accurately reflect market prices of generic brands, thereby reducing out-of-pocket costs for patients. The legislation does not extend or restrict its application through subordinate instruments but relies on existing regulations to implement its provisions.

Key Provisions

The main operative sections of the National Health (Originator Brand) Amendment Determination 2016 (No. 7) amend the National Health (Originator Brand) Determination 2015 (PB 100 of 2015) to determine the originator brand of a pharmaceutical item for a drug, imatinib, that has moved to the F2 formulary of the Pharmaceutical Benefits Scheme (PBS) from the F1 formulary (s 1). This determination is necessary to implement the removal of originator brand data from price disclosure calculations as set out in the National Health (Pharmaceutical Benefits) Regulations 1960 (s 2). The decision to determine the originator brand was based on the drug being the listed brand when it was on F1 (s 3). This legislative instrument requires the Minister or delegate to determine the originator brand of a pharmaceutical item under subsection 99ADB(6B) of the National Health Act 1953 when certain criteria are met (s 4). The Minister or delegate must consider whether the brand was on F1 or the Combination Drug List when it was first determined as a brand of pharmaceutical item under subsection 85(6) of the Act (s 5). The company with a PBS listed brand of the drug for which an originator brand has been determined must be consulted, although in this instance no comments were received (s 6). The obligations imposed on the parties or entities governed by this Act include the requirement for the Minister or delegate to determine the originator brand of a pharmaceutical item when certain criteria are met, specifically when a drug moves from F1 to F2 (s 4). The company with a PBS listed brand of the drug for which an originator brand has been determined must be consulted, although this consultation did not result in any comments for this particular amendment (s 6). The Act also requires that the originator removal will potentially increase price disclosure-related price reductions because originator brands tend to maintain higher prices than other brands (s 2). The consequences for breach of this legislation are not explicitly stated, but the potential civil or criminal penalties for breaches of the National Health Act 1953 or the National Health (Pharmaceutical Benefits) Regulations 1960 could apply. These penalties may include fines and imprisonment, depending on the nature and severity of the breach. The maximum penalties for offences under the National Health Act 1953 can include fines of up to $22,200 for individuals and $111,000 for bodies corporate, and imprisonment for up to two years for serious offences. The penalties for breaches of the Regulations may vary but can also include significant fines and, in some cases, imprisonment. However, it is important to note that the specific penalties for breaches of this particular legislative instrument are not outlined in the text provided.