National Health (Price and Special Patient Contribution) Amendment Determination 2023 (No. 6)

Administered by Department of Health, Disability and Ageing

Legislation au F2023L01150 Not in force Legislative Instrument

Legislation content

EXPLANATORY STATEMENT

NATIONAL HEALTH ACT 1953

NATIONAL HEALTH (PRICE AND SPECIAL PATIENT CONTRIBUTION) AMENDMENT DETERMINATION 2023 (No. 6)

PB 88 of 2023

 

Authority

This legislative instrument, made under section 85B of the National Health Act 1953 (the Act), amends the National Health (Price and Special Patient Contribution) Determination 2022 (PB 98 of 2022) (the Principal Determination).

Subsections 85B(2), (3) and (4) of the Act provide for the Minister to determine, respectively, determined prices, claimed prices and the circumstances in which the Commonwealth will pay a special patient contribution. The Principal Determination contains determinations of these matters.

Variation and revocation

Unless there is an express power to revoke or vary PB 98 of 2022 cited in this instrument and explanatory statement, subsection 33(3) of the Acts Interpretation Act 1901 is relied upon to revoke or vary PB 98 of 2022.

Purpose

The Act provides for the Minister and the responsible person to agree a price that is taken to be the appropriate maximum price of a brand of a pharmaceutical item for the purposes of Part VII of the Act (section 85AD). Section 85B of the Act applies if the Minister and the responsible person have been unable to reach an agreement on a price for the pricing quantity. Whether or not an agreement is made for the pricing quantity, section 85B also applies if the responsible person is dissatisfied with the proportional ex-manufacturer prices that will apply to other pack quantities.

Subsection 85B(2) provides that the Minister may determine, by reference to the pricing quantity of a brand of a pharmaceutical item, an amount that is taken to be the appropriate maximum price of the brand for the purposes of Part VII of the Act. This is termed the ‘Determined Price’ in this Determination.

Subsection 85B(3) provides that the Minister may determine, by reference to a pack quantity of a brand of the pharmaceutical item, an amount that is taken to be the price claimed by the responsible person for the pack quantity of the brand, for the purposes of Part VII of the Act. This is termed the ‘Claimed Price’ in this Determination.

The Determined Price is the Approved Ex-Manufacturer Price (AEMP) and is used as the basis for working out the Commonwealth price for the brand of the pharmaceutical item (section 98B of the Act); for pack quantities other than the pricing quantity, the proportional ex-manufacturer price (PEMP) is used as the basis. Approved pharmacists are entitled to receive a payment from the Commonwealth equal to the Commonwealth price less the applicable patient co-payment (section 99 of the Act).

The difference between the Responsible Person’s Commonwealth price for a pack quantity (i.e., the price that would be the Commonwealth price if the responsible person’s claimed price had become the approved ex-manufacturer price or the proportional ex-manufacturer price for that pack quantity) and the Commonwealth price for the pack quantity is defined in subsection 85B(5) of the Act as the special patient contribution. An approved pharmacist may charge a patient an amount equal to the special patient contribution, in addition to any other amount that may be charged (subsection 87(2A) of the Act).

Subsection 85B(4) of the Act provides that the Minister may determine the circumstances in which the Commonwealth is to pay the Special Patient Contribution for a brand. In such cases, the Commonwealth payment to the pharmacist is increased by the amount of the special patient contribution (subsection 99(2AA) of the Act) and the pharmacist may not charge the patient this amount (subsection 87(2A) of the Act). 

The purpose of making subsection 85B(4) determinations is to enable patients for whom the base-priced brands (the ones without a special patient contribution) are not suitable, to obtain the higher priced brand (the one with the special patient contribution) without the need to pay the higher price. In such cases the Commonwealth pays the special patient contribution.

This instrument (the determination) amends the Principal Determination by removing one brand of one pharmaceutical item (polyvinyl alcohol, Liquifilm Tears) and the 4 mg wafer, 4 pack presentation of ondansetron , Zofran Zydis. The 10 pack of this strength and the 4 and 10 packs of the 8 mg strength are being retained.

Consultation

This Determination affects certain responsible persons with medicines listed on the PBS. In this case the responsible persons have requested de-listing of particular products which carry a brand price premium. The de-listing has been agreed. The removal of these items from the Principal Determination is a consequence of that de-listing.

A provision by provision description of the Determination is contained in the Attachment.

This Determination commences on 1 September 2023.

This Determination is a legislative instrument for the purposes of the Legislation Act 2003.

 


ATTACHMENT 

 

PROVISION BY PROVISION DESCRIPTION OF THE NATIONAL HEALTH (PRICE AND SPECIAL PATIENT CONTRIBUTION) AMENDMENT DETERMINATION 2023 (No .6)

(PB 88 of 2023)

Section 1   Name of Determination

This section provides that the Determination is the National Health (Price and Special Patient Contribution) Amendment Determination 2023 (No. 6) and may also be cited as PB 88 of 2023.

Section 2   Commencement

This section provides that the Determination commences on 1 September 2023.

Section 3   Amendment of the National Health (Price and Special Patient Contribution) Determination 2022 (PB 98 of 2022).

This section provides that Schedule 1 amends the National Health (Price and Special Patient Contribution) Determination 2022 (PB 98 of 2022).

Schedule 1 Amendments commencing 1 September 2023

Schedule 1 sets out the amendments to the Principal Determination which commence on 1 September 2023.

 

 

SUMMARY OF CHANGES

SCHEDULE 1

 

Brands with brand premiums removed

 

  1. Ondansetron, wafer 4mg, 4, Zofran Zydis.  
  2. Polyvinyl alcohol, eye drops, 14 mg per ml, Liquifilm Tears.

 

 

 

 

 

 

 

 

 

 

 

Statement of Compatibility with Human Rights

Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011

National Health (Price and Special Patient Contribution) Amendment Determination 2023 (No. 6) (PB 88 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, made under section 85B of the National Health Act 1953 (the Act), amends the National Health (Price and Special Patient Contribution) Determination 2022 (the Principal Determination), which provides for price determinations in relation to brands of pharmaceutical items listed on the Pharmaceutical Benefits Scheme (PBS) for which the Minister and the responsible person have not been able to make a price agreement. It also provides for the circumstances in which the Commonwealth will pay the special patient contribution resulting from these price determinations. This instrument amends the principal determination by removing two brands of two pharmaceutical items which had a brand price premium which will be delisted from the PBS as requested by the responsible persons. These changes take effect on 1 September 2023.

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 advancement of this human right by providing for subsidised access by patients to medicines. Deletion of the one brand of polyvinyl alcohol) and the one presentation of ondansetron is unlikely to result in negative financial impact on patient access therefore ensuring their rights to social security are maintained. A premium free brand of polyvinyl alcohol and seven premium-free 4 mg presentations of ondansetron remain available on the PBS.

Eligible Australians may continue to access any one of the remaining brands for these pharmaceutical items at subsidised prices as they are flagged for substitution by pharmacists against the respective delisting brands.

It is longstanding Government policy that pharmaceutical companies are only able to charge brand price premiums where there is at least one premium-free brand of that medicine available through the PBS. All brands subsidised by the PBS are evaluated by the Therapeutic Goods Administration (TGA) for quality and safety and determined to be bioequivalent, which means they are clinically equivalent and work in the same way. Removing items with brand price premiums will not result in negative financial impact for patients, therefore ensuring their rights to social security are maintained. The recommendatory role of the Pharmaceutical Benefits Advisory Committee (PBAC) ensures that decisions about subsidised access to medicines on the PBS are evidence-based.

In this case, the instrument is being amended by removing two brands of medicine that the responsible persons wish to delist from the Pharmaceutical Benefit Scheme. There are alternative brands available on the PBS.

Conclusion

This legislative instrument is compatible with human rights because 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 (Price and Special Patient Contribution) Amendment Determination 2023 (No. 6) (PB 88 of 2023) amends the National Health (Price and Special Patient Contribution) Determination 2022, made under section 85B of the National Health Act 1953. This Act, originally enacted in 1953, provides for the regulation of health services and related matters, including the setting of prices for pharmaceutical items listed on the Pharmaceutical Benefits Scheme (PBS). The 2023 Amendment Determination addresses the problem of pharmaceutical brands with price premiums by removing two such brands from the PBS as requested by the responsible parties. This change ensures that only one brand of a pharmaceutical item can charge a price premium if there is at least one premium-free brand available on the PBS. The policy objective is to enable patients to access higher-priced brands without incurring the full cost, where appropriate, while maintaining the rights to social security and ensuring that the PBS remains a benefit scheme that promotes the highest attainable standard of physical and mental health. This legislative instrument, prepared in accordance with the Legislation Act 2003, is compatible with human rights as it advances the protection of human rights by ensuring continued access to alternative brands at subsidised prices. The changes, which take effect on 1 September 2023, are in line with longstanding government policy that allows pharmaceutical companies to charge brand price premiums only if at least one premium-free brand is available through the PBS. The Pharmaceutical Benefits Advisory Committee’s recommendatory role ensures that decisions about the availability of medicines on the PBS are evidence-based, safeguarding the health and financial security of eligible Australians.

Scope and Application

The National Health (Price and Special Patient Contribution) Amendment Determination 2023 (No. 6) amends the National Health (Price and Special Patient Contribution) Determination 2022, which sets out price determinations for brands of pharmaceutical items on the Pharmaceutical Benefits Scheme (PBS) for which the Minister and the responsible person have not reached an agreement. This amendment applies to the specific pharmaceutical brands of polyvinyl alcohol (Liquifilm Tears) and ondansetron (Zofran Zydis), where brand price premiums were involved, and removes these items from the PBS at the request of the responsible persons. These changes are effective from 1 September 2023. The amendment ensures that there is at least one premium-free brand available for each pharmaceutical item on the PBS, in line with Government policy. 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 by ensuring continued access to essential medicines at subsidised prices.

Key Provisions

The National Health (Price and Special Patient Contribution) Amendment Determination 2023 (No. 6) (PB 88 of 2023) amends the National Health (Price and Special Patient Contribution) Determination 2022 (PB 98 of 2022). This determination is made under section 85B of the National Health Act 1953, which allows the Minister to set prices for pharmaceutical items listed on the Pharmaceutical Benefits Scheme (PBS) where agreement cannot be reached between the Minister and the responsible person. This amendment removes two brands from the Principal Determination: polyvinyl alcohol, Liquifilm Tears, and the 4 mg wafer, 4 pack presentation of ondansetron, Zofran Zydis. The amendment takes effect on 1 September 2023. The Act imposes specific obligations on parties involved in the pricing and supply of pharmaceutical items. The Minister is responsible for determining the appropriate maximum price of a brand of a pharmaceutical item when an agreement cannot be reached with the responsible person. The responsible person, typically the manufacturer, is required to provide necessary information and participate in discussions to reach a pricing agreement. If no agreement is reached, the Minister may determine the price under section 85B(2). Additionally, section 85B(4) of the Act allows the Minister to determine when the Commonwealth will pay a special patient contribution for a brand. This determination ensures that patients who need a particular brand but cannot afford the higher price can still access it with financial assistance from the Commonwealth. Failure to comply with the provisions of this Act may result in civil or criminal consequences. While the Act itself does not specify particular offences or penalties, breaches of related provisions in the National Health Act 1953 can lead to significant penalties. For example, under section 107A of the Act, a person who makes a false or misleading representation in the course of supplying a pharmaceutical benefit may face penalties. The maximum penalty for an individual is $22,200 or five years imprisonment, or both, whereas for a corporation, the maximum penalty is $1,110,000. Additionally, pharmacists who fail to comply with the provisions regarding the charging of patients or the Commonwealth for pharmaceutical benefits may face penalties under section 99 of the Act. Such penalties serve as a deterrent to non-compliance and ensure the integrity of the PBS. In summary, the National Health (Price and Special Patient Contribution) Amendment Determination 2023 modifies the Principal Determination by removing specific pharmaceutical brands from the PBS, ensuring that eligible Australians can continue to access alternative brands at subsidised prices. The Act sets out clear obligations for the Minister and responsible persons in determining prices and special patient contributions, with potential civil and criminal penalties for non-compliance. This amendment supports the broader objective of the PBS to provide affordable access to essential medicines.

Legal classification tags

Area of Law
Health Law
Pharmaceutical Law
Instrument
Statutory Instrument
Concepts
Definitions & Interpretation
Repeal & Amendment
Licensing & Registration
Enforcement Powers
Reporting & Disclosure Obligations

Interactions

Authorises

All Versions

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.