National Health (Weighted average disclosed price – interim supplementary disclosure cycle) Amendment Determination 2012 (No. PB 70 of 2012)

Overview

The National Health (Weighted average disclosed price – interim supplementary disclosure cycle) Amendment Determination 2012 was enacted to amend the National Health (Weighted average disclosed price – interim supplementary disclosure cycle) Determination 2012 under the National Health Act 1953. This Act was introduced to address the issue of price transparency and the need for a more accurate and timely disclosure of pharmaceutical prices within the Pharmaceutical Benefits Scheme (PBS). The amendment was made to include new listed brands that were added to the PBS after the original determination was made but before a specified reduction day, and to remove brands that were no longer listed on the PBS. The policy objective is to ensure that responsible persons for listed brands receive a price disclosure reduction where applicable, while maintaining the integrity and transparency of pharmaceutical pricing within the scheme. The amendment was made by the Minister for Health pursuant to subsection 99ADB(4) of the Act, and it affects pharmaceutical companies with medicines listed on the PBS. These companies were consulted during the development and implementation of the price disclosure requirements, ensuring their concerns and suggestions were considered in the legislative process. The amendment aims to provide a more accurate and up-to-date picture of pharmaceutical prices within the PBS by including new listed brands and removing those that are no longer available. The amendment determination commences on the day after it is registered on the Federal Register of Legislative Instruments, and it is a legislative instrument for the purposes of the Legislative Instruments Act 2003.

Scope and Application

The National Health (Weighted average disclosed price – interim supplementary disclosure cycle) Amendment Determination 2012 is a legislative instrument made under the authority of the National Health Act 1953, and it applies to pharmaceutical companies with medicines listed on the Pharmaceutical Benefits Scheme (PBS). The amendment specifically targets the weighted average disclosed price (WADP) for new listed brands, which are brands listed on the PBS after the initial determination but before a specified reduction day of 1 December 2012. These brands have been allocated to the interim supplementary disclosure cycle by regulation 37F of the National Health (Pharmaceutical Benefits) Regulations 1960. The Act ensures that only responsible persons for listed brands appearing in Schedule 1 of the Principal Instrument will receive a price disclosure reduction on and from 1 December 2012, provided the approved ex-manufacturer price for the listed brand is more than the determined adjusted approved ex-manufacturer price for that brand. The amendment also removes brands no longer listed on the PBS. This instrument is part of the Commonwealth’s regulatory framework and applies nationally, affecting entities and individuals involved in the pharmaceutical industry within Australia.

Key Provisions

The main operative sections of the National Health (Weighted average disclosed price – interim supplementary disclosure cycle) Amendment Determination 2012 (PB 70 of 2012) (the Amending Determination) include the addition of new listed brands to Schedule 1 of the National Health (Weighted average disclosed price – interim supplementary disclosure cycle) Determination 2012 (PB 58 of 2012) (the Principal Instrument) (section 1(2)). These are brands that were listed on the Pharmaceutical Benefits Scheme (PBS) after the Principal Instrument was made but before the reduction day of 1 December 2012, and which have been allocated to the interim supplementary disclosure cycle by regulation 37F of the National Health (Pharmaceutical Benefits) Regulations 1960 (section 1(1)). Brands which are no longer listed on the PBS are also removed from Schedule 1 of the Principal Instrument (section 1(3)). The Amending Determination imposes obligations on pharmaceutical companies that have a listed brand appearing in Schedule 1 of the Principal Instrument. These companies, referred to as responsible persons, must ensure that the ‘approved ex-manufacturer price’ for their listed brand is more than the determined ‘adjusted approved ex-manufacturer price’ (AAEMP) for that brand on the reduction day of 1 December 2012 to be eligible for a price disclosure reduction (section 1(4)). Additionally, pharmaceutical companies must comply with the transitional provision in item 77(3) of Schedule 1 of the National Health Amendment (Pharmaceutical Benefits Scheme) Act 2012, which states that the weighted average disclosed price (WADP) rather than the adjusted approved price to pharmacists will be used for the purposes of price reductions on the reduction day. Failure to comply with the requirements of the Amending Determination may result in civil or criminal consequences. While the determination does not explicitly state penalties for non-compliance, it is made under the authority of the National Health Act 1953 (the Act), which may impose penalties under section 16 of the Act for non-compliance with regulations or determinations made under the Act. Penalties under the Act may include fines and, in some cases, imprisonment for offences such as providing false or misleading information. It is important for responsible persons to be aware of their obligations under the Amending Determination and the Principal Instrument to avoid potential penalties and ensure compliance with the price disclosure requirements for listed brands on the PBS. Pharmaceutical companies should also stay informed of any changes to the legislation and regulations related to the Pharmaceutical Benefits Scheme to ensure ongoing compliance.