EXPLANATORY STATEMENT
National Health Act 1953
National Health (Paxlovid) Special Arrangement 2022
PB 39 of 2022
Authority
The Pharmaceutical Benefits Scheme (PBS) is established under the National Health Act 1953 (the Act) and provides Australians with timely, reliable and affordable access to necessary and cost-effective medicines. The Act regulates the listing, prescribing, pricing, charging and payment of subsidies for supply of drugs and medicinal preparations as pharmaceutical benefits.
Subsection 100(1) of the Act enables the Minister to make special arrangements for, or in relation to, providing that an adequate supply of pharmaceutical benefits will be available to certain persons. These are persons who: live in isolated areas; or are receiving treatment in circumstances in which pharmaceutical benefits are inadequate for that treatment; or if the pharmaceutical benefits covered by the arrangements can be more conveniently or efficiently supplied under the arrangements.
Subsection 100(2) of the Act provides that the Minister may vary or revoke an arrangement made under subsection 100(1) of the Act.
Subsection 100(3) of the Act provides that Part VII of the Act, and instruments made for the purposes of Part VII, have effect, subject to a special arrangement made under subsection 100(1).
Purpose
In March 2022 the Pharmaceutical Benefits Advisory Committee (PBAC) undertook an expedited consideration of a submission to add the combination product, nirmatrelvir and ritonavir (Paxlovid®) to the PBS for use in treating patients with mild to moderate COVID-19 who are at risk of developing severe disease requiring hospitalisation. The expedited consideration by the PBAC recognises the urgent public health need related to the prevention, management, or treatment of COVID-19 infections.
The PBAC recommended the listing on the PBS of Paxlovid® as a General Schedule, Authority Required (STREAMLINED) pharmaceutical benefit. The PBS is an appropriate mechanism to provide timely and equitable access to oral COVID-19 treatments.
The National Health (Paxlovid) Special Arrangement 2022 (the instrument) made under s100(1) of the Act, specifies that the responsible person for Paxlovid® is the Commonwealth for the purposes of listing this drug on the PBS. The arrangement whereby the Commonwealth is the responsible person for Paxlovid® is intended to be a temporary measure to make this treatment for COVID-19 available on the PBS. The instrument also specifies the approved ex-manufacturer price (AEMP) for Paxlovid® as $1,000.
A PBS listing for Paxlovid® means eligible patients can access this medicine from a community pharmacy on prescription from a doctor or nurse practitioner.
Background
Nirmatrelvir and ritonavir (Paxlovid®) is an oral medicine provisionally approved by the Therapeutic Goods Administration (TGA) on 18 January 2022 for the treatment of adults (18 and older) with COVID-19 who do not require initiation of oxygen due to COVID-19 and who are at increased risk for hospitalisation or death.
Vaccines are proven to provide the best protection against COVID-19, however there are some individuals who are at higher risk for severe disease if they become infected with COVID-19. Factors that put people at high risk include older age, certain medical conditions or being moderately or severely immunocompromised.
Paxlovid® has been found to be effective in reducing the risk of hospitalisation or death in people with mild to moderate COVID-19 who are a high risk of progressing to severe disease. As with other TGA approved COVID-19 treatments not everyone who contracts COVID-19 will require access to these treatments. This treatment will be of most benefit for people at risk of severe disease.
Consultation
The involvement of interested parties through the membership of the PBAC constitutes a formal and ongoing process of consultation. The PBAC is an independent expert body established by section 100A of the Act which makes recommendations to the Minister about which drugs and medicinal preparations should be available to Australians as pharmaceutical benefits.
The PBAC members are appointed following nomination by prescribed organisations and associations from consumers, health economists, practising community pharmacists, general practitioners, clinical pharmacologists and specialists, with at least one member selected from each of those interests or professions. Remaining members are persons whom the Minister is satisfied have qualifications and experience in a field relevant to the functions of the PBAC, and that would enable them to contribute meaningfully to the deliberations of the PBAC. In addition, an industry nominee has been appointed to the PBAC membership under the PBS Access and Sustainability Package of reforms announced in May 2015. When recommending the listing of a medicine on the PBS, the PBAC takes into account the medical conditions for which the medicine has been approved for use in Australia, its clinical effectiveness, safety and cost-effectiveness compared with other treatments.
Pharmaceutical companies are consulted throughout the process of the listing of their medicines on the PBS and in relation to changes to those listings. This includes involvement throughout the PBAC process, negotiations or consultation on price, guarantee of supply and agreement to final listing details.
The Department of Health made the instrument available to Pfizer, the pharmaceutical company for Paxlovid®, for comment. No comment on the nature of the instrument was received from Pfizer.
This instrument commences 1 May 2022.
The Act specifies no conditions that need to be satisfied before the power to make the instrument is exercised.
This instrument is a legislative instrument for the purposes of the Legislation Act 2003.
A provision-by-provision description of the instrument is contained in the Attachment.
ATTACHMENT
Details of the National Health (Paxlovid) Special Arrangement 2022
Section 1 Name
This section provides that the name of the instrument is the National Health (Paxlovid) Special Arrangement 2022 (the instrument) and may also be cited as PB 39 of 2022.
Section 2 Commencement
This section provides that the instrument commences on 1 May 2022.
Section 3 Authority
This section provides that the instrument is made under section 100 of the National Health Act 1953 (the Act).
Section 4 Simplified outline of this instrument
This section explains the purpose of the instrument which is to make a special arrangement for the supply of certain pharmaceutical benefits for the purpose of treating COVID-19.
This section also summarises the instrument’s key features, including that the Commonwealth will be the responsible person for Paxlovid® and that the instrument also specifies that the approved ex‑manufacturer price of Paxlovid® will be $1,000.
The note in this section clarifies that Part VII of the Act, and regulations or other instruments made for the purposes of that Part of the Act, have effect subject to this instrument (see subsection 100(3) of the Act).
The simplified outline is included to assist readers to understand the substantive provisions and is not intended to be comprehensive. It is intended that readers should rely on the substantive provisions of the instrument.
Section 5 Definitions
A number of expressions used in the instrument are defined in section 5.
The expressions Act, brand and pharmaceutical item have the same meaning as in the Act.
Section 5 also defines Paxlovid® as having the meaning as specified in section 6 of this instrument.
Section 6 Meaning of Paxlovid®
The terms responsible person and approved ex‑manufacturer price are each defined in section 84 of the Act in relation to a brand of a pharmaceutical item. Sections 7 and 8 of this instrument make provision for those matters by reference to the brand Paxlovid®.
Therefore, section 6 provides a definition for Paxlovid® as being the brand of the pharmaceutical item in the form and with the manner of administration as specified in the table, being that Paxlovid® is nirmatrelvir and ritonavir, in the form of a carton containing 5 blister cards, each blister card containing 4 tablets nirmatrelvir 150 mg and 2 tablets ritonavir 100 mg, the tablets being administered orally.
Section 7 Responsible Person
Subsection 7(1) provides the responsible person for Paxlovid® (as defined in section 6) is the Commonwealth.
Subsection 7(2) provides that subsection (1) applies despite section 84 of the Act. Section 84 of the Act defines the responsible person for a brand of pharmaceutical item as meaning the person determined by the Minister under section 84AF to be the responsible person for the brand of the pharmaceutical item.
The effect of this provision is to make the Commonwealth the responsible person for Paxlovid® as a temporary measure to support PBS-subsidised access to this treatment for COVID-19 in recognition of the urgent public health need related to the prevention, management, or treatment of COVID-19 infections.
Section 8 Approved ex-manufacturer price
Subsection 8(1) specifies the approved ex-manufacturer price (AEMP) for Paxlovid® (as defined in section 6) as $1,000.
Subsection 8(2) provides that subsection (1) has effect as if the $1,000 AEMP for Paxlovid® was the result of a price agreement under section 85AD of the Act. The AEMP for a brand of a pharmaceutical item, if a price agreement under section 85AD of the Act is in force, is the agreed price, taken to be the appropriate maximum price (section 84 of the Act).
In essence section 8 negates the need for the Minister to enter into a price agreement with the Commonwealth as the responsible person for Paxlovid® under s85AD of the Act. It is intended that where the Act refers to the ‘AEMP’, ‘agreed price’ and ‘price agreement’ (other than the act of entering into the price agreement under s85AD), that those provisions of the Act will apply to the supply of Paxlovid®, as if a price agreement was made under s85AD.
Statement of Compatibility with Human Rights
Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011
National Health (Paxlovid) Special Arrangement 2022
PB 39 of 2022
This 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 Instrument
In March 2022 the Pharmaceutical Benefits Advisory Committee (PBAC) undertook an expedited consideration of a submission to add the combination product, nirmatrelvir and ritonavir (Paxlovid®) to the PBS for use in treating patients with mild to moderate COVID-19 who are at risk of developing severe disease requiring hospitalisation. The expedited consideration by PBAC recognises the urgent public health need related to the prevention, management, or treatment of COVID-19 infections.
The PBAC recommended the listing on the PBS of Paxlovid® as a General Schedule, Authority Required (STREAMLINED) pharmaceutical benefit. The PBS is an appropriate mechanism to provide timely and equitable access to oral COVID-19 treatments.
The National Health (Paxlovid) Special Arrangement 2022 (the instrument) made under s100(1) of the Act, specifies that the responsible person for Paxlovid® is the Commonwealth for the purposes of listing this drug on the PBS. The arrangement whereby the Commonwealth is the responsible person for Paxlovid® is intended to be a temporary measure to make this treatment for COVID-19 available on the PBS. The instrument also specifies the approved ex-manufacturer price (AEMP) for Paxlovid® as $1,000.
A PBS listing for Paxlovid® means eligible patients can access this medicine from a community pharmacy on prescription from their doctor or nurse practitioner.
Human rights implications
The instrument engages Articles 2, 9 and 12 of the ICESCR by assisting with the progressive realisation by all appropriate means of the right of everyone to social security and to the enjoyment of the highest attainable standard of physical and mental health. The instrument assists with the advancement of these human rights by supporting the listing of Paxlovid® on the PBS. The instrument ensures more ready and equitable access to the medicine for eligible people.
Broadly, the PBS is a benefits scheme which assists with the advancement of these human rights by providing subsidised access to medicines for people in the community. The recommendatory role of the PBAC ensures that decisions about subsidised access to medicines on the PBS are evidence-based.
Conclusion
The instrument is compatible with human rights because it advances the protection of human rights.