EXPLANATORY STATEMENT
INSTRUMENT NUMBER PB 88 OF 2015
NATIONAL HEALTH ACT 1953
National Health (Weighted average disclosed price – October 2015 reduction day)
Amendment Determination 2015 (No.1)
Authority
This legislative instrument is made pursuant to subsection 99ADB(4) of the National Health Act 1953 (the Act), which provides that the Minister may, by legislative instrument, determine the weighted average disclosed price (WADP) of a brand of a pharmaceutical item (listed brand) in accordance with the National Health (Pharmaceutical Benefits) Regulations 1960 (the Regulations).
Subsection 99ADB(7) of the Act further provides that a subsection 99ADB(4) determination for a listed brand may include the adjusted approved ex-manufacturer price (AAEMP) for the listed brand.
Purpose
This legislative instrument amends the National Health (Weighted average disclosed price – October 2015 reduction day) Determination 2015 (PB 53 of 2015) (the Principal Instrument) by:
- amending the WADP determinations for all brands of pharmaceutical items containing the drugs acitretin for oral administration (acitretin oral), clozapine for oral administration (clozapine oral) and risedronic acid for oral administration (risedronic acid oral) and amending the AAEMP for brands of acitretin oral and risedronic acid oral;
- revoking the determination of the WADPs for all brands of pharmaceutical items containing the drugs bleomycin for administration by injection (bleomycin injection), doxorubicin for administration by injection/intravesical (doxorubicin injection), irinotecan for administration by injection (irinotecan injection), methotrexate for administration by injection (methotrexate injection) and paclitaxel for administration by injection (paclitaxel injection); and
- inserting WADPs for two new brands of two new pharmaceutical items:
- Esomeprazole, Capsule (enteric) 20 mg (as magnesium), Oral; and
- Esomeprazole, Capsule (enteric) 40 mg (as magnesium), Oral.
The Principal Instrument was made pursuant to subsection 99ADB(4) and paragraph 99ADH(1)(aa) of the Act for brands of pharmaceutical items with a data collection period ending 31 March 2015 (2015 October cycle).
Amendments
Acitretin oral, clozapine oral and risedronic acid oral
Amendments are being made following consideration of matters raised by certain responsible persons concerning the determinations in the Principal Instrument for brands containing acitretin oral, clozapine oral and risedronic acid oral. A review of determinations in response to matters raised by responsible persons revealed that incorrect data had been submitted by some responsible persons. Corrected data was submitted by some responsible persons for acitretin oral, clozapine oral and risedronic acid oral brands for the 2015 October cycle and new calculation for the WADPs set out in this amending determination were completed under the Act and Regulations.
Schedule 1 of the Principal Instrument includes a WADP/AAEMP for brands of the acitretin oral, clozapine oral and risedronic acid oral pharmaceutical items. This amending instrument removes the previous WADPs for brands of all three drugs and inserts the revised WADPs for brands of acitretin oral and risedronic acid oral in the appropriate column in Schedule 1 and for clozapine oral in Schedule 2.
Listed brands of clozapine oral are included in Schedule 2 of the Principal Instrument because their unadjusted price reduction following determination of the amended WADP is less than 10%. Listed brands of acitretin oral and risedronic acid oral are included in Schedule 1 because they have an unadjusted price reduction of at least 10%.
For those brands with a WADP re-inserted in Schedule 1, the same amount is also determined as the AAEMP for the brands due to the operation of section 7 of the Principal instrument.
A responsible person for a listed brand appearing in Schedule 1 of the Principal Instrument will receive a price disclosure reduction on and from 1 October 2015, provided that, on that date, the ‘approved ex-manufacturer price’ for the listed brand is more than the determined ‘AAEMP’ for that brand.
Revocation of WADPs
This amending instrument revokes the WADP determination in the Principal Instrument for all brands of pharmaceutical items containing the following five efficient funding of chemotherapy (EFC) drug and manner of administrations (drug/MoAs): bleomycin injection, doxorubicin injection, irinotecan injection, methotrexate injection and paclitaxel injection based on the particular circumstances that exist in these cases. As a result of the amending instrument no price disclosure reduction would apply to any brand containing bleomycin injection, doxorubicin injection, irinotecan injection, methotrexate injection and paclitaxel injection on 1 October 2015.
All brands containing the five EFC drug/MoAs above recently had price increases approved or received a recommendation to have their current price maintained. The revocations were made to prevent a decrease in price, followed by an increase shortly after, which would cause considerable inconvenience to a range of stakeholders. No other brand containing an EFC drug/MoA subject to a 1 October 2015 price disclosure reduction had price increases approved or received a recommendation to have their current price maintained.
Insertion of WADP determinations for New Brands of New Pharmaceutical Items
A WADP is required to be determined for new brands of pharmaceutical items listing between 1 July 2015 and 1 September 2015 that have no other existing brand of the same pharmaceutical item (including a single brand pharmaceutical item where the brand or pharmaceutical item changes, or where all existing brands change).
There are two brands of two new pharmaceutical items that have been included in the attached instrument. They are the Noxicid Caps® brand of the Esomeprazole, Capsule (enteric) 20 mg (as magnesium), Oral pharmaceutical item; and the Noxicid Caps® brand of the Esomeprazole, Capsule (enteric) 40 mg (as magnesium), Oral pharmaceutical item.
Basis for amendments
Subsection 33(3) of the Acts Interpretation Act 1901 is relied upon to vary or revoke the determination made under subsection 99ADB(4) for the medicines affected by this amending instrument.
Consultation
This instrument affects companies that are a responsible person for brands of pharmaceutical items containing acitretin oral, clozapine oral, risedronic acid oral, bleomycin injection, doxorubicin injection, irinotecan injection, methotrexate injection and paclitaxel injection. Each of the affected companies were consulted concerning the amendments. No concerns were expressed.
The responsible person of the two new brands of new pharmaceutical items was not consulted because the determination of a WADP for these brands will not result in a price disclosure price reduction to these brands.
This instrument commences on the day after it is registered on the Federal Register of Legislative Instruments.
This instrument is a legislative instrument for the purposes of the Legislative Instruments Act 2003.