National Health (Weighted average disclosed price – October 2023 reduction day) Amendment Determination 2023

Administered by Department of Health, Disability and Ageing

Legislation au F2023L01213 Not in force Legislative Instrument

Legislation content

EXPLANATORY STATEMENT

INSTRUMENT NUMBER PB 89 of 2023

NATIONAL HEALTH ACT 1953

National Health (Weighted average disclosed price – October 2023 reduction day) Amendment Determination 2023

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 2017 (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.

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 legislative instrument.

Purpose

This legislative instrument amends the National Health (Weighted average disclosed price – October 2023 reduction day) Determination 2023 (PB 53 of 2023) (the Principal Instrument) by:

  • inserting into Schedule 1 WADPs for brands of pharmaceutical items containing:
    • pemetrexed, solution concentrate for I.V. infusion 1 g (as disodium) in 40 mL, injection;
    • pemetrexed, solution concentrate for I.V. infusion 500 mg (as disodium) in 20 mL, injection;
    • pemetrexed, solution concentrate for I.V. infusion 100 mg (as disodium) in 4 mL, injection;
  • inserting into Schedule 2 WADPs for brands of pharmaceutical items containing:
    • methadone, oral liquid containing methadone hydrochloride 25 mg per 5 mL in 200 mL bottle, 1 mL, oral;
    • methadone, oral liquid containing methadone hydrochloride 25 mg per 5 mL in 1 L bottle, 1 mL, oral;
    • naloxone, nasal spray 1.8 mg (as hydrochloride dihydrate) in 0.1 mL single dose unit, 2 (s19A), nasal;
  • removing from Schedule 1 and inserting in Schedule 2 WADPs for brands of pharmaceutical items containing:
    • ambrisentan, tablet 5 mg, oral;
    • ambrisentan, tablet 10 mg, oral;
    • fenofibrate, tablet 145 mg, oral;
    • fenofibrate, tablet 48 mg, oral; and
  • revising WADPs in Schedule 1 for brands of pharmaceutical items containing:
    • aciclovir, eye ointment 30 mg per g, 4.5 g, application to the eye.


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 2023 (2023 October cycle).

Amendments

Revision of WADP determinations for brands of pharmaceutical items

Amendments to the Principal Instrument are being made following consideration of matters raised by Responsible Persons. These Amendments concern the determinations made in the Principal Instrument for brands of pharmaceutical items containing ambrisentan and fenofibrate, which will no longer take price disclosure reductions on 1 October 2023.

A review of determinations in response to matters raised by Responsible Persons revealed that WADP calculations had not taken into account disclosed data from the Responsible Person of the originator brand. Calculations for the WADPs including originator brand data set out in this amending determination had been calculated accordance with the Act and Regulations and were used for this revised determination, moving this drug from Schedule 1 to Schedule 2.

A review of determinations in response to matters raised by Responsible Persons revealed that a Responsible Person for a brand of fenofibrate had submitted incorrect data. Corrected data was resubmitted. New calculations for the WADPs set out in this amending determination were completed in accordance with the Act and Regulations, moving this drug from Schedule 1 to Schedule 2.

Insertion of WADP determinations for new brands of new pharmaceutical items

WADPs need to be determined for brands of new pharmaceutical items listing on the F2 formulary between 1 April 2023 and 30 September 2023 and where the drug is currently subject to price disclosure requirements.

 

There are six new pharmaceutical items that are included in this legislative instrument, brands of which have been listed on the PBS between the publication of the Principal Determination and this Amendment Determination. These new pharmaceutical items have been inserted into Schedule 2 with the exception of pemetrexed pharmaceutical items, which have been inserted into Schedule 1.

Consultation

This instrument affects Responsible Persons for all brands of the drug and manner of administration aciclovir oral, ambrisentan oral, fenofibrate oral, methadone oral, naloxone nasal and pemetrexed injection.

A review of all determinations made in the Principal Instrument was conducted in accordance with the Price Disclosure Dispute Resolution Administrative Process, which provided Responsible Persons the opportunity to identify to the Department of Health and Aged Care any perceived issues with WADP determinations in the Principal Instrument. The Department conducted investigations to ensure the reductions were calculated correctly and that the reductions do not increase the risk of shortages in supply or unmet patient need. The reduction for one pharmaceutical item will change.

No additional consultation with experts was undertaken, as consultation with affected Responsible Persons drew on the knowledge of persons with relevant expertise.

This instrument commences on the day after registration. 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 (Weighted average disclosed price – October 2023 reduction day) Amendment Determination 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 instrument amends the National Health (Weighted average disclosed price – October 2023 reduction day) Determination 2023 (the Principal Instrument) to a) remove brands of pharmaceutical items which will no longer have a price reduction on reduction day from Schedule 1 and insert them in Schedule 2, b) update the WADP for brands of pharmaceutical items in Schedule 1, and c) update WADPs for brands of pharmaceutical items in Schedule 2.

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

Price disclosure provides for the ‘approved ex-manufacturer price’ of a ‘brand of a pharmaceutical item’ to be reduced on a reduction day in certain specified circumstances. The reduction is based on sales revenue, incentives and volume data collected from responsible persons (drug companies) and occurs in accordance with the Act and the National Health (Pharmaceutical Benefits) Regulations 2017.

The amendments are made to provide for correct and effective reductions in prices for pharmaceutical benefits on 1 October 2023 under the statutory provisions for price disclosure.

Human rights implications

This Determination engages Article 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 that assists providing subsidised access to medicines for people. This is a positive and supportive step towards attaining the highest standard of health for all Australians. The price disclosure program progressively reduces the price of some PBS medicines, which are subject to competition, ensuring better value for money from these medicines. These reductions may also result in patients accessing these medicines at lower prices.

Conclusion

This Determination is compatible with human rights because it advances the protection of human rights.

Adriana Platona

First Assistant Secretary

Technology Assessment and Access Division

Department of Health and Aged Care

Overview

The National Health (Weighted average disclosed price – October 2023 reduction day) Amendment Determination 2023 was enacted to address discrepancies and ensure the correct application of price reductions for certain pharmaceutical items under the National Health Act 1953. This legislative instrument amends the National Health (Weighted average disclosed price – October 2023 reduction day) Determination 2023, which was initially established to set the weighted average disclosed prices (WADP) for various pharmaceutical brands. The amendment was made to rectify inaccuracies in the original determinations, particularly concerning the drugs ambrisentan and fenofibrate, where initial calculations did not correctly incorporate data from responsible persons. This legislative action is taken by the Minister for Health under the authority granted by subsection 99ADB(4) of the Act. The primary policy objective of this amendment is to ensure that the pharmaceutical benefits provided under the Pharmaceutical Benefits Scheme (PBS) are affordable and accessible to all Australians, thereby promoting equitable health outcomes. This amendment process involved reviewing and revising WADPs based on corrected and newly disclosed data, and appropriately adjusting the schedules of pharmaceutical items affected by these changes. This ensures that the price disclosure program operates fairly and effectively, ultimately supporting the broader goal of the PBS to provide subsidised access to medicines. The amendments also include the insertion of new pharmaceutical items into the appropriate schedules, ensuring that all listed brands are subject to the correct price reduction schedules as stipulated by the Act. The legislative instrument is designed to maintain the integrity and effectiveness of the PBS by ensuring that price reductions are calculated accurately and applied correctly, thereby protecting and enhancing access to essential medicines.

Scope and Application

This legislative instrument amends the National Health (Weighted average disclosed price – October 2023 reduction day) Determination 2023 by adjusting the weighted average disclosed prices (WADPs) of various pharmaceutical items, thereby affecting the pharmaceutical benefits provided under the Pharmaceutical Benefits Scheme (PBS) as outlined in Part VII of the National Health Act 1953. This instrument applies to Responsible Persons, who are the entities responsible for the brands of pharmaceutical items listed in the schedules of the instrument, and to the pharmaceutical items listed, including those containing ambrisentan, fenofibrate, methadone, naloxone, and pemetrexed, which are affected by the price reductions or reclassifications. The instrument is applicable nationally within Australia, as it pertains to the PBS administered by the Commonwealth, ensuring that the adjustments made are consistent across the country. The instrument does not specify exclusions or exemptions; however, it does adjust the WADPs based on accurate data and considerations, including the removal of certain drugs from price reduction schedules and the insertion of new pharmaceutical items into the schedules. The Act and Regulations provide the framework for these amendments, and any further application or restrictions are outlined in subordinate instruments.

Key Provisions

The National Health (Weighted average disclosed price – October 2023 reduction day) Amendment Determination 2023, as referenced in section 19A of the National Health Act 1953 (the Act), provides adjustments to the weighted average disclosed price (WADP) of various pharmaceutical items listed for the October 2023 price disclosure cycle. The amendment includes the insertion of new WADPs for brands containing pemetrexed, methadone, and naloxone, while amending WADPs for brands containing aciclovir and revising those for brands containing ambrisentan and fenofibrate. Furthermore, it relocates certain brands from Schedule 1 to Schedule 2, reflecting changes in the pharmaceutical pricing strategy. This amendment is critical for ensuring that the Pharmaceutical Benefits Scheme (PBS) continues to provide affordable access to necessary medications by appropriately adjusting the prices of certain pharmaceutical items based on market data and other factors. Under the Act, the Minister for Health is responsible for determining the WADP for pharmaceutical brands listed on the PBS. This involves a rigorous process of data collection from responsible persons, who are typically the manufacturers or suppliers of the pharmaceutical products. These data submissions are subject to scrutiny to ensure accuracy and compliance with the legislative requirements set out in the Act and the National Health (Pharmaceutical Benefits) Regulations 2017. The obligations on responsible persons include the timely and accurate submission of sales revenue, incentives, and volume data, which are used to calculate the WADPs. The Minister must ensure that these calculations are fair, transparent, and in line with the objectives of the PBS, which is to provide reliable, timely, and affordable access to a wide range of medicines for all Australians. The Act imposes penalties for non-compliance with the requirements for data submission and WADP calculation. Responsible persons who fail to provide accurate and timely data, or who submit misleading information, may face civil or criminal penalties. Under section 19B of the Act, an offence is established for knowingly providing false or misleading information, which can result in a civil penalty of up to $222,200 for individuals and $1,111,000 for bodies corporate, as well as criminal penalties, including fines and imprisonment. These measures are designed to maintain the integrity of the PBS and ensure that all stakeholders adhere to the legislative requirements. The seriousness of these penalties underscores the importance of compliance in maintaining the PBS's effectiveness and public trust.

Legal classification tags

Area of Law
Pharmaceutical Law
Instrument
Legislative Instrument
Concepts
Definitions & Interpretation
Regulatory Standards
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.