National Health (Originator Brand) Amendment Determination 2019 (No. 6) (PB 73 of 2019)

Administered by Department of Health, Disability and Ageing

Legislation au F2019L01121 Not in force Legislative Instrument

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EXPLANATORY STATEMENT

 

 

National Health Act 1953

 

National Health (Originator Brand) Amendment Determination 2019 (No. 6)

 

PB 73 of 2019

Authority

This legislative instrument is made pursuant to subsection 99ADB(6B) of the National Health Act 1953 (the Act).

Purpose

This legislative instrument amends the National Health (Originator Brand) Determination 2015 (PB 100 of 2015) (the Principal Instrument) to determine the originator brand of a new pharmaceutical item of an existing Pharmaceutical Benefits Scheme (PBS) listed drug on the F2 formulary on 1 September 2019.

The Principal Instrument determines originator brands of pharmaceutical items that have a drug on the F2 formulary.  On meeting certain criteria, drugs move from the F1 formulary (see s 85AB of the Act), or the single brand Combination Drug List (CDL), to F2.  All drugs on F2 are subject to price disclosure.  This instrument is necessary to implement removal of originator brand data from price disclosure calculations (originator removal) in certain circumstances as set out in the National Health (Pharmaceutical Benefits) Regulations 2017 (the Regulations).  Originator removal will potentially increase price disclosure related price reductions because originator brands tend to maintain higher prices than other brands.

Amendments

An originator brand determination is set out in Schedule 1 of this amending instrument for the addition of a new pharmaceutical item of a PBS listed drug (buprenorphine), Buvidal Monthly and Buvidal Weekly on F2 on 1 September 2019.  Subsection 99ADB(6C) of the Act provides that when deciding whether to determine originator brands the Minister (or delegate) must have regard to whether the brand was on F1 or CDL when it was first determined as a brand of pharmaceutical item under subsection 85(6) of the Act.

The main criteria used to determine these brands as originators were that they were the listed brands of the drug when it was on F1 or CDL.

Basis for amendments

Subsection 33(3) of the Acts Interpretation Act 1901 is relied upon to vary or revoke the determination made under subsection 99ADB(6B) for the medicines affected by this amending instrument.

Consultation

The company with a PBS listed brand of the drug for which an originator brand has been determined was asked for comments in relation to the potential originator brand determination.  The company stated they believe Buvidal Weekly and Buvidal Monthly meet the definition of an originator brand.

This instrument commences on 1 September 2019.

This instrument is a legislative instrument for the purposes 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 (Originator Brand) Amendment Determination 2019 (No. 6) (PB 73 of 2019)

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 amends the National Health (Originator Brand) Determination 2015 (PB 100 of 2015) (the Principal Instrument) to determine an originator brand of a new pharmaceutical item for the Pharmaceutical Benefits Scheme (PBS) F2 formulary on 1 September 2019.

The instrument is necessary to implement removal of originator brand data for price disclosure calculations (originator removal) in certain circumstances as set out in the National Health (Pharmaceutical Benefits) Regulations 2017 (the Regulations).  Originator removal will potentially increase PBS price reductions as originator brands tend to maintain higher prices than other brands.  Originator removal means that the Government price would more closely reflect the prices at which generic brands of the medicine are being sold in the market, not the prices of all brands.

The PBS provides Australians with timely, reliable and affordable access to necessary and
cost-effective medicines.  The PBS operates under Part VII of the National Health Act 1953 (the Act) which regulates the listing, prescribing, pricing, charging and payment of subsidies for supply of drugs and medicinal preparations as pharmaceutical benefits.  The Regulations prescribe matters and set out details in relation to the operation of the PBS.

Human rights implications

This legislative instrument is compatible with Articles 2 and 12 of the International Covenant on Economic, Social and Cultural Rights 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 assists with advancement of this human right by providing subsidised access to medicines for Australians.

Originator removal will improve the operation of the PBS by delivering better value for money for PBS medicines through price reductions.  This will assist consumers by reducing out-of-pocket costs for some PBS medicines.

Conclusion

This legislative instrument is compatible with human rights as it advances the protection of human rights.

 

 

 

Thea Daniel

Assistant Secretary

 Pricing and PBS Policy Branch

Technology Assessment and Access Division

Department of Health

Overview

The National Health (Originator Brand) Amendment Determination 2019 (No. 6) is a legislative instrument made under the National Health Act 1953, aiming to address the need for determining originator brands of new pharmaceutical items listed on the Pharmaceutical Benefits Scheme (PBS) F2 formulary as of 1 September 2019. Enacted by the Parliament of Australia, this amendment responds to the need to implement originator removal from price disclosure calculations, as stipulated in the National Health (Pharmaceutical Benefits) Regulations 2017. This policy seeks to potentially increase price reductions in the PBS by allowing the government price to more closely reflect the market prices of generic brands, thus benefiting consumers through lower out-of-pocket costs for some PBS medicines. The determination was made following consultation with the company holding the PBS listed brand of the drug in question, which supported the designation of the new pharmaceutical items as originator brands.

Scope and Application

The National Health (Originator Brand) Amendment Determination 2019 (No. 6) amends the National Health (Originator Brand) Determination 2015 to determine the originator brand of a new pharmaceutical item for the Pharmaceutical Benefits Scheme (PBS) F2 formulary, effective from 1 September 2019. This amendment is necessary to implement the removal of originator brand data from price disclosure calculations in certain circumstances as outlined in the National Health (Pharmaceutical Benefits) Regulations 2017. The Act applies to the Minister for Health and their delegate, who are responsible for determining originator brands of pharmaceutical items under the National Health Act 1953. The amendment specifically addresses the originator brand status for Buvidal Monthly and Buvidal Weekly, which are new pharmaceutical items of the PBS-listed drug buprenorphine added to the F2 formulary on 1 September 2019. Originator removal, which excludes originator brand data from price disclosure calculations, is expected to increase price reductions for PBS medicines, ultimately benefiting consumers by reducing out-of-pocket costs. This instrument is compatible with human rights, particularly the right to the enjoyment of the highest attainable standard of physical and mental health, by providing more affordable access to necessary medicines.

Key Provisions

The National Health (Originator Brand) Amendment Determination 2019 (No. 6) (F2019L01121) amends the National Health (Originator Brand) Determination 2015 (PB 100 of 2015) to determine the originator brand of a new pharmaceutical item, specifically buprenorphine, under the Pharmaceutical Benefits Scheme (PBS) F2 formulary, effective from 1 September 2019 (section 2). This amendment is essential for implementing the removal of originator brand data from price disclosure calculations in certain circumstances as outlined in the National Health (Pharmaceutical Benefits) Regulations 2017 (subsection 99ADB(6C) of the National Health Act 1953). The determination of originator brands is based on whether the brand was listed on the F1 formulary or the Combination Drug List (CDL) when it was first recognised as a brand of pharmaceutical item (subsection 99ADB(6C) of the Act). The Act imposes obligations on the Minister or their delegate to determine originator brands by considering the brand's status on the F1 formulary or CDL when it was first recognised as a brand under subsection 85(6) of the Act (subsection 99ADB(6B) of the Act). In this instance, the criteria used to determine Buvidal Weekly and Buvidal Monthly as originator brands were that these brands were listed when the drug was on the F1 or CDL. The company with the PBS listed brand of the drug was consulted, and they agreed that Buvidal Weekly and Buvidal Monthly meet the definition of an originator brand. Failure to comply with the requirements of the Act and its regulations can result in civil and criminal consequences. However, this specific legislative instrument does not outline specific offences, penalties, or civil/criminal consequences for breach. The National Health (Pharmaceutical Benefits) Regulations 2017, however, may contain provisions regarding penalties for non-compliance with the PBS regulations. These penalties can include fines and other sanctions, depending on the nature and severity of the breach. The maximum penalties would be as stipulated in the Regulations. The compatibility of this legislative instrument with human rights is ensured, as it supports the realisation of the right to the highest attainable standard of physical and mental health by providing affordable access to necessary medicines through the PBS.

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