National Health (Originator Brand) Amendment Determination 2023 (No. 5)

Administered by Department of Health, Disability and Ageing

Legislation au F2023L01344 Not in force Legislative Instrument

Legislation content

EXPLANATORY STATEMENT

 

National Health Act 1953

National Health (Originator Brand) Amendment Determination 2023 (No. 5)

PB 98 of 2023

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 originator brand status for two pharmaceutical items of an existing Pharmaceutical Benefits Scheme (PBS) listed drug on the F2 formulary on 1 October 2023.

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 (s85AB 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.

Amendment

An amendment to the originator brand determination is set out in Schedule 1 of this amending instrument for two pharmaceutical items of an existing PBS listed drug on F2 (methylprednisolone). A first new brand is listing of the drug methylprednisolone with the manner of administration application.  The brand determined as an originator was already listed when the drug was on the F1 formulary before the move to F2. 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 Act’s 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 PBS listed brands of the drug already on F2 was consulted on the potential originator brand determination. No comments were received from the affected company. No additional consultation with experts was undertaken regarding this determination because consultation with the affected companies drew on the knowledge of persons with relevant expertise.

This instrument commences on 1 October 2023.

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 2023 (No. 5) (PB 98 of 2023)

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 originator brands of two pharmaceutical items for one drug already on the F2 formulary of the PBS on
1 October 2023.

The instrument is necessary to implement removal of originator brand data for price disclosure calculations in certain circumstances as set out in the National Health (Pharmaceutical Benefits) Regulations 2017 (the Regulations). Originator brand removal from price disclosure calculations will potentially increase PBS price reductions, as originator brands tend to maintain higher prices than other brands. Originator brand 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, 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 engages 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 is a benefits scheme that assists with providing subsidised access to medicines for people. This is a positive and supportive step towards attaining the highest standard of health for all Australians.

Determining an originator brand will improve the operation of the PBS by delivering better value for money for PBS medicines through price disclosure 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.

 

Nikolai Tsyganov

Assistant Secretary

Pricing and PBS Policy Branch

Technology Assessment and Access Division

Department of Health and Aged Care

Overview

The National Health (Originator Brand) Amendment Determination 2023 (No. 5) was enacted to address the need for determining originator brands of pharmaceutical items listed on the F2 formulary of the Pharmaceutical Benefits Scheme (PBS) under the National Health Act 1953. This amendment is made pursuant to subsection 99ADB(6B) of the Act and is intended to facilitate the removal of originator brand data from price disclosure calculations, potentially leading to increased price reductions for PBS medicines. The policy objective is to improve value for money in the PBS by ensuring that price disclosure more accurately reflects the prices of generic brands, thereby reducing out-of-pocket costs for consumers. The amendment was made in consultation with the affected pharmaceutical company, with no additional expert consultation deemed necessary due to the expertise available within the company. This legislative instrument is deemed compatible with human rights, particularly Articles 2 and 12 of the International Covenant on Economic, Social and Cultural Rights, as it supports the progressive realisation of the right to the highest attainable standard of physical and mental health by making necessary medicines more affordable.

Scope and Application

The National Health (Originator Brand) Amendment Determination 2023 (No. 5) amends the National Health (Originator Brand) Determination 2015 to determine the originator brand status of two pharmaceutical items of a drug already listed on the F2 formulary of the Pharmaceutical Benefits Scheme (PBS) on 1 October 2023. The amendment is made under the National Health Act 1953 and 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. This removal of originator brand data is expected to increase price disclosure-related price reductions since originator brands typically maintain higher prices than other brands, thereby potentially reducing out-of-pocket costs for consumers. The determination is specific to the pharmaceutical item methylprednisolone, with the amendment considering whether the brand was listed when the drug was on the F1 formulary before moving to F2. The decision-making process involved consultation with the company having PBS listed brands of the drug already on F2, though no comments were received. The instrument is compatible with human rights as it supports the right to the highest attainable standard of physical and mental health by facilitating better value for money and potentially reducing costs for PBS medicines.

Key Provisions

The main operative sections of the National Health (Originator Brand) Amendment Determination 2023 (No. 5) (F2023L01344) amend the National Health (Originator Brand) Determination 2015 (PB 100 of 2015) to determine the originator brand status for two pharmaceutical items of the drug methylprednisolone, which is listed on the F2 formulary of the Pharmaceutical Benefits Scheme (PBS) as of 1 October 2023 (Schedule 1). This amendment is necessary to implement the removal of originator brand data from price disclosure calculations in certain circumstances, as stipulated in the National Health (Pharmaceutical Benefits) Regulations 2017. By removing originator brand data, the PBS aims to increase price-related reductions, as originator brands tend to maintain higher prices than generic brands, thereby potentially lowering out-of-pocket costs for consumers. The Act imposes specific obligations on the parties involved, particularly concerning the determination of originator brands. According to the Act, when determining whether to designate a brand as an originator, the Minister (or delegate) must consider whether the brand was on the F1 formulary or the Combination Drug List (CDL) when it was first identified as a brand of a pharmaceutical item (subsection 99ADB(6C)). For this amendment, the main criteria used were that the brands in question were listed when the drug was on the F1 formulary or CDL. The basis for these amendments is found in subsection 33(3) of the Interpretation Act 1901, which allows for the variation or revocation of the determination. Any breach of the provisions in this legislative instrument may lead to civil or criminal consequences, depending on the nature and severity of the violation. The National Health (Pharmaceutical Benefits) Regulations 2017 outline the penalties for non-compliance, which can include fines and other sanctions. The exact penalties are not specified in this particular amending instrument but would typically be detailed in the Regulations themselves. Given that the amendment aims to enhance the affordability and accessibility of medicines through price disclosure, non-compliance could potentially undermine these objectives, leading to higher costs for consumers and reduced efficiency in the PBS.

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Legislative Instrument
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Reporting & Disclosure Obligations
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Sourced from the Federal Register of Legislation at 26 August 2026. For the latest information on Australian Government law please go to https://www.legislation.gov.au.