National Health (Pharmaceutical Benefits Scheme-Exempt items - Section 84AH) Amendment Determination 2023 (No. 3)

Administered by Department of Health, Disability and Ageing

Legislation au F2023L01342 Not in force Legislative Instrument

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EXPLANATORY STATEMENT

 

NATIONAL HEALTH ACT 1953

NATIONAL HEALTH (PHARMACEUTICAL BENEFITS SCHEME-EXEMPT ITEMS - SECTION 84AH) AMENDMENT DETERMINATION 2023 (NO. 3)

PB 100 of 2023

 

Purpose

 

The purpose of this legislative instrument, made under section 84AH of the National Health Act 1953 (the Act), is to amend the legislative instrument titled National Health (Pharmaceutical Benefits Scheme-Exempt items – Section 84 AH) Determination 2017 (PB 81 of 2017) to make changes to the pharmaceutical items that are determined to be exempt items.

 

Background

 

Part VII of the Act is the legislative basis of the Pharmaceutical Benefits Scheme (PBS) by which the Commonwealth provides reliable, timely and affordable access to a wide range of medicines for all Australians.

 

Drugs and medicinal preparations to which Part VII applies are declared as such by the Minister, by legislative instrument under subsection 85(2) of the Act. These are listed drugs (as defined in subsection 84(1)). The Minister may also determine by legislative instrument the form or forms of a listed drug by reference to strength, type of unit, size of unit or otherwise (subsection 85(3)) and the manner of administration of the form of the listed drug so determined (subsection 85(5)). If a drug has a declaration under subsection 85(2) in force in respect of it and determinations under subsections 85(3) and 85(5) in force in respect of it, then that declared drug in that determined form with that determined manner of administration is a pharmaceutical item. The Minister may also determine, by legislative instrument, brands of pharmaceutical items (subsection 85(6)).

 

Section 84AH empowers the Minister to determine, by legislative instrument, that a pharmaceutical item is an ‘exempt item’ if the pharmaceutical item satisfies the criteria in section 84AH. The criteria in section 84AH are as follows:

(a)   that there is only one listed brand of the relevant pharmaceutical item; and

(b)   there are no listed brands of other pharmaceutical items that are bioequivalent or biosimilar to the one listed brand of the relevant pharmaceutical item; and

(c)   there is at least one other pharmaceutical item that has the same listed drug as the relevant pharmaceutical item; and

(d)   the Minister is satisfied (having regard to advice, if any, from the Pharmaceutical Benefits Advisory Committee that:

  1. the listed drug in the relevant pharmaceutical item represents suitable therapy for a particular patient population; and
  2. the relevant pharmaceutical item is suitable for use by a particular subgroup of that population because of either or both of the form and manner of administration; and
  3. no other pharmaceutical item that has that drug is suitable for use by that subgroup because of either or both of the form and manner of administration of the drug in that other item.

 

The effect of a pharmaceutical item being determined to be an exempt item is that the listed brand of that pharmaceutical item is excluded from certain statutory price reductions and price disclosure requirements under Divisions 3A and 3B of Part VII of the Act. The intention is to encourage the availability of certain pharmaceutical items with particular formulations of drugs that are used by a demographic subgroup (e.g. children or geriatric patients) for whom other formulations of the drug are not suitable.

 

Changes to PB 81 of 2017 made by this instrument

 

This instrument makes the following change to PB 81 of 2017:

 

One pharmaceutical item (listed drug = Cefuroxime, form = Powder for oral suspension 125 mg (as axetil) per 5 mL, 100 mL, manner of administration = Oral) is no longer determined to be an exempt item as it does not meet criteria a and d (iii) above, that is, there is another listed brand of the pharmaceutical item.

 

Variation and revocation

Unless there is an express power to revoke or vary PB 81 of 2017 cited in this Instrument and explanatory statement, subsection 33(3) of the Acts Interpretation Act 1901 is relied upon to revoke or vary PB 81 of 2017.

 

Consultation

Consultation on the Amending Determination has taken place with the relevant pharmaceutical company regarding the removal of exempt status on the specified form of cefuroxime. No additional consultations with experts was undertaken regarding this determination because consultation with the affected company drew on the knowledge of persons with relevant expertise.

General

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 (Pharmaceutical Benefits Scheme-Exempt items - Section 84AH) Amendment Determination 2023 (No. 3) (PB 100 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 National Health (Pharmaceutical Benefits Scheme-Exempt items - Section 84AH) Determination 2017 (the Principal Determination) determines exempt pharmaceutical items. This instrument (the Amending Determination) amends the principal determination which provides for the allocation of drugs to the exempt list if the pharmaceutical item satisfies the criteria in section 84AH of the National Health Act 1953 (the Act).

This instrument amends the principal determination by removing the specified form of the drug cefuroxime from the exempt list as it does not meet the criteria in section 84AH of the Act.

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 benefit scheme which 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 exempt items under section 84AH of the Act encourages the availability of certain pharmaceutical items with particular formulations of drugs that are used by a demographic subgroup (e.g. children or geriatric patients) for whom other formulations of the drug are not suitable. The recommendatory role of the Pharmaceutical Benefits Advisory Committee ensures that decisions about subsidised access to medicines on the PBS are evidence-based.

Conclusion

This legislative instrument is compatible with human rights. Human rights continue to be protected by retaining on the PBS clinically important medicines and maintaining exemptions from pricing reductions only where appropriate under the legislation.

 

 

Nikolai Tsyganov

Assistant Secretary

Pricing and PBS Policy Branch

Technology Assessment and Access Division
Department of Health and Aged Care

 

Overview

The National Health (Pharmaceutical Benefits Scheme-Exempt items - Section 84AH) Amendment Determination 2023 (No. 3) was enacted to modify the National Health (Pharmaceutical Benefits Scheme-Exempt items – Section 84AH) Determination 2017, adjusting the list of pharmaceutical items that are exempt from certain statutory price reductions and price disclosure requirements under the National Health Act 1953. This legislative instrument was introduced to address the need for updating the exempt pharmaceutical items list, ensuring the Pharmaceutical Benefits Scheme (PBS) continues to provide reliable, timely, and affordable access to medicines for all Australians. The determination was enacted by the Minister for Health under the authority of section 84AH of the National Health Act 1953, with the primary policy objective of maintaining the availability of certain pharmaceutical items with particular formulations suitable for specific patient populations, such as children or geriatric patients, for whom other formulations are not suitable. This amendment specifically removes a certain form of cefuroxime from the exempt list as it does not meet the criteria outlined in section 84AH of the Act. The determination process involved consultation with the relevant pharmaceutical company, ensuring that the decision was informed by relevant expertise. The instrument aims to support the progressive realisation of the right to the highest attainable standard of physical and mental health, as recognised under Articles 2 and 12 of the International Covenant on Economic, Social and Cultural Rights. The Pharmaceutical Benefits Advisory Committee's recommendatory role ensures that decisions regarding access to medicines on the PBS are evidence-based, thereby safeguarding human rights by maintaining access to clinically important medicines and applying exemptions judiciously.

Scope and Application

The National Health (Pharmaceutical Benefits Scheme-Exempt items - Section 84AH) Amendment Determination 2023 (No. 3) amends the National Health (Pharmaceutical Benefits Scheme-Exempt items – Section 84AH) Determination 2017, which is made under section 84AH of the National Health Act 1953. This Act applies to the Pharmaceutical Benefits Scheme (PBS) and provides the basis for the Commonwealth to ensure affordable access to medicines for all Australians. The Amendment Determination 2023 modifies the list of pharmaceutical items that are exempt from certain statutory price reductions and price disclosure requirements under the PBS, ensuring that these exemptions are only applied when it is appropriate and necessary for specific patient populations, such as children or geriatric patients, for whom certain drug formulations are more suitable. This amendment applies nationally and affects pharmaceutical companies and entities involved in the supply and administration of medicines under the PBS. The determination specifies that one pharmaceutical item, a form of the drug cefuroxime, is no longer considered an exempt item as it does not meet the criteria set out in section 84AH of the Act, specifically that there is only one listed brand of the relevant pharmaceutical item and the Minister is satisfied that the listed drug in the relevant pharmaceutical item is suitable for use by a particular subgroup of the population due to the form and manner of administration. The criteria under section 84AH of the Act are designed to ensure that exemptions are granted judiciously, considering the therapeutic needs of specific demographic subgroups. This legislative instrument is compatible with human rights, particularly the right to the highest attainable standard of physical and mental health, by maintaining access to clinically important medicines through the PBS while ensuring that exemptions are appropriately targeted.

Key Provisions

The National Health (Pharmaceutical Benefits Scheme-Exempt Items - Section 84AH) Amendment Determination 2023 (No. 3) amends the Pharmaceutical Benefits Scheme (PBS) under the National Health Act 1953 (the Act) by removing a particular form of the drug cefuroxime from the list of exempt pharmaceutical items. This change is based on the criteria outlined in section 84AH of the Act, which specifies that a pharmaceutical item may be considered an exempt item if it meets certain conditions, such as there being only one listed brand of the item and that it is suitable for use by a particular subgroup of patients due to its form and manner of administration. The criteria also require that the Minister is satisfied, based on advice from the Pharmaceutical Benefits Advisory Committee, that the item represents suitable therapy for a particular patient population. The removal of the specified form of cefuroxime from the exempt list was determined because it no longer meets the criteria in section 84AH(a) and (d)(iii), as there is now another listed brand of the pharmaceutical item. The Act imposes several obligations on the Minister and other parties involved in the PBS. The Minister is required to determine whether a pharmaceutical item meets the criteria to be considered an exempt item under section 84AH, which includes considering advice from the Pharmaceutical Benefits Advisory Committee. Pharmaceutical companies and other entities involved in the manufacturing and supply of pharmaceutical items must comply with the determinations made by the Minister regarding the listing and classification of pharmaceutical items under the PBS. This includes ensuring that the forms and manners of administration of pharmaceutical items meet the criteria set out in the Act. Breaches of the obligations or requirements under the Act may result in civil or criminal penalties. While specific penalties are not detailed in the explanatory statement, breaches of legislative instruments under the National Health Act 1953 can lead to fines and other legal consequences. The precise penalties would depend on the nature and severity of the breach, as well as any relevant provisions in other legislation that may apply. The Act and associated regulations provide for enforcement mechanisms to ensure compliance with the PBS and the provisions related to exempt pharmaceutical items. This includes the power to impose financial penalties for non-compliance, which can vary depending on the specific breach and the relevant legislative provisions.

Legal classification tags

Area of Law
Health Law
Pharmaceutical Law
Instrument
Legislative Instrument
Concepts
Reporting & Disclosure Obligations
Compliance Obligations
Regulatory Standards
Licensing & Registration
Catchwords
Exempt Items
Pharmaceutical Benefits Scheme

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