National Health (Originator Brand) Amendment Determination 2022 (No. 2)

Overview

The National Health (Originator Brand) Amendment Determination 2022 (No. 2) amends the National Health (Originator Brand) Determination 2015 to determine the originator brands for two new drugs, lacosamide and palonosetron, added to the Pharmaceutical Benefits Scheme (PBS) F2 formulary. This amendment is necessary to implement the removal of originator brand data from price disclosure calculations, a change mandated by the National Health (Pharmaceutical Benefits) Regulations 2017. The primary objective of this legislation is to facilitate increased price reductions on PBS-listed medicines, as originator brands typically maintain higher prices than generic alternatives. By removing originator brand data from price disclosure calculations, the Government aims to better align PBS prices with the market prices of generic brands, thereby reducing out-of-pocket costs for consumers and enhancing the cost-effectiveness of the PBS. This legislative instrument is compatible with human rights as it supports the progressive realisation of the right to the highest attainable standard of physical and mental health, as recognised in the International Covenant on Economic, Social and Cultural Rights.

Scope and Application

The National Health (Originator Brand) Amendment Determination 2022 (No. 2) amends the National Health (Originator Brand) Determination 2015 to determine the originator brands of two pharmaceutical items, lacosamide and palonosetron, which are moving from the F1 formulary to the F2 formulary of the Pharmaceutical Benefits Scheme (PBS) as of 1 April 2022. This change is made pursuant to subsection 99ADB(6B) of the National Health Act 1953, which allows the Minister (or delegate) to determine originator brands of pharmaceutical items on the F2 formulary. The amendment responds to the requirement to remove originator brand data from price disclosure calculations under certain circumstances as outlined in the National Health (Pharmaceutical Benefits) Regulations 2017. The decision to designate these drugs as originator brands is based on them being the listed brands when they were initially on the F1 formulary, in accordance with subsection 99ADB(6C) of the Act. The amendment is necessary to implement originator brand removal, which may increase price disclosure-related price reductions as originator brands typically maintain higher prices than other brands. This legislative instrument is compatible with human rights, specifically engaging Articles 2 and 12 of the International Covenant on Economic, Social and Cultural Rights by supporting the progressive realisation of the right to the highest attainable standard of physical and mental health through improved access to affordable medicines via the PBS.

Key Provisions

The National Health (Originator Brand) Amendment Determination 2022 (No. 2) (F2022L00460) amends the National Health (Originator Brand) Determination 2015 (PB 100 of 2015) to determine the originator brands of two new drugs, lacosamide and palonosetron, which will be added to the Pharmaceutical Benefits Scheme (PBS) F2 formulary on 1 April 2022 (subsection 99ADB(6B) of the National Health Act 1953). This change 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 removal of originator brand data from price disclosure calculations may lead to increased price reductions on the PBS, as originator brands typically maintain higher prices than other brands. The main criteria for determining the originator brands were that they were the listed brands of the drug when it was on the F1 formulary. This determination is based on subsection 33(3) of the Acts Interpretation Act 1901. The National Health Act 1953 imposes certain obligations on parties and entities involved in the PBS. These include the requirement for the Minister or delegate to consider whether the brand was on the F1 formulary or the Combination Drug List (CDL) when it was first determined as a brand of pharmaceutical item under subsection 85(6) of the Act. The Act also mandates the implementation of the National Health (Pharmaceutical Benefits) Regulations 2017 and the National Health (Originator Brand) Determination 2015. Additionally, the Act requires consultation with companies holding a PBS listed brand of the drugs moving from F1 to F2, as was the case with lacosamide and palonosetron. The Regulations prescribe the matters and set out the details in relation to the operation of the PBS, including the determination of originator brands and the calculation of prices for disclosure purposes. The National Health (Originator Brand) Amendment Determination 2022 (No. 2) does not explicitly state any offences, penalties, or civil/criminal consequences for breach. However, the National Health Act 1953 and the National Health (Pharmaceutical Benefits) Regulations 2017 outline various offences and penalties for breaches of the PBS regulations. For example, the Act includes provisions for offences related to the supply of pharmaceutical benefits, unauthorised supply, and false or misleading statements, with penalties ranging from fines to imprisonment. It is important to note that the specific penalties for breaches of the Act and Regulations may vary depending on the nature and severity of the offence.