EXPLANATORY STATEMENT
INSTRUMENT NUMBER PB 51 of 2012
NATIONAL HEALTH ACT 1953
National Health (Weighted average disclosed price – third transitional disclosure cycle) Amendment Determination 2012
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) and the adjusted approved price to pharmacists (AAPTP) for the listed brand.
Purpose
This legislative instrument amends the National Health (Weighted average disclosed price – third transitional disclosure cycle) Determination 2012 (PB 12 of 2012) (the Principal Instrument), which is made pursuant to subsection 99ADB(4) and paragraph 99ADH(1)(aa) of the Act and makes certain determinations relating to price disclosure for listed brands in the third transitional disclosure cycle with a data collection period ending 31 January 2012.
The purpose of this amending instrument is to add listed brands that were listed on the Pharmaceutical Benefits Scheme (PBS) after the Principal Instrument was made, but prior to the reduction day of 1 August 2012, and which have been allocated to the third transitional disclosure cycle by regulation 37F of the Regulations (new listed brands). Brands which are no longer listed on the PBS are also removed.
Only 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 August 2012, provided that, on that date, the ‘approved price to pharmacists’ for the listed brand is more than the determined ‘AAPTP’ for that brand.
New listed brands
The new listed brands listed on the PBS on 1 May, 1 June or 1 July 2012.
Each entry for a new listed brand is inserted into Schedule 1 of the Principal Instrument because these listed brands have an unadjusted price reduction that has been calculated to be at least 10%.
Consultation
This instrument affects pharmaceutical companies with medicines listed on the PBS. Pharmaceutical companies have been consulted in relation to the introduction of price disclosure requirements during both the policy development and implementation of the further PBS reforms of 2010. This has occurred through meetings with both peak body organisations and individual companies. Information on the price disclosure measure has been disseminated through peak industry bodies, during regular meetings with the Price Disclosure Working Group and direct to responsible persons through information sessions and educational workshops.
Responsible persons with a listed brand that is new to the PBS between
1 May 2012 and 1 July 2012 (inclusive) have been informed of the reductions for those 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.
Overview
The National Health (Weighted average disclosed price – third transitional disclosure cycle) Amendment Determination 2012 is an instrument made under the National Health Act 1953. Its purpose is to amend the National Health (Weighted average disclosed price – third transitional disclosure cycle) Determination 2012 by including new listed brands that were added to the Pharmaceutical Benefits Scheme (PBS) after the original determination was made but before the price reduction effective date of 1 August 2012. This amendment ensures that the price disclosure requirements apply to these new brands, which have an unadjusted price reduction of at least 10%. Simultaneously, brands that are no longer listed on the PBS are removed from the scope of the determination. This legislative instrument was introduced to address the need for timely and accurate price disclosure for pharmaceutical items on the PBS, ensuring that responsible persons receive a price disclosure reduction if their approved price to pharmacists exceeds the adjusted approved price to pharmacists.
Scope and Application
The National Health (Weighted average disclosed price – third transitional disclosure cycle) Amendment Determination 2012 applies to responsible persons who have a listed brand of a pharmaceutical item that appears in Schedule 1 of the Determination. This includes pharmaceutical companies with medicines listed on the Pharmaceutical Benefits Scheme (PBS). The Amendment Determination amends the National Health (Weighted average disclosed price – third transitional disclosure cycle) Determination 2012 to add new listed brands that were listed on the PBS between 1 May 2012 and 1 July 2012. These new brands will receive a price disclosure reduction on and from 1 August 2012, provided that the approved price to pharmacists for the brand is more than the determined adjusted approved price to pharmacists for that brand. Brands that are no longer listed on the PBS are removed from the Principal Instrument. The Amendment Determination has a national reach and applies to all states and territories within Australia. The Amendment Determination extends or restricts application through subordinate instruments, such as the National Health (Pharmaceutical Benefits) Regulations 1960. Pharmaceutical companies with medicines listed on the PBS have been consulted in relation to the introduction of price disclosure requirements during both the policy development and implementation of the further PBS reforms of 2010.
Key Provisions
The key operative sections of this legislative instrument are sections 4(1) and 4(2), which amend the National Health (Weighted average disclosed price – third transitional disclosure cycle) Determination 2012 (PB 12 of 2012) by inserting new entries into Schedule 1 of that Determination (subsection 4(1)). Section 4(2) provides that the amended Determination takes effect on and from the day after this instrument is registered on the Federal Register of Legislative Instruments. These sections add new listed brands to the Pharmaceutical Benefits Scheme (PBS) and adjust their prices as part of the third transitional disclosure cycle.
The obligations imposed by this Act on the parties it governs include ensuring that responsible persons for listed brands that are new to the PBS between 1 May 2012 and 1 July 2012 (inclusive) are informed of the price reductions applicable to those brands. This is achieved through consultation and communication with pharmaceutical companies and responsible persons. Specifically, section 4(1) requires the insertion of new entries for these listed brands into Schedule 1 of the Principal Instrument, while section 4(2) ensures that these amendments take effect on the day after registration of this instrument.
The consequences for breach of this legislation are not explicitly stated in the text. However, under the general framework of Australian law, failure to comply with the obligations imposed by this Act could potentially result in legal action, fines, or other penalties as prescribed by relevant laws. The specific consequences would depend on the nature and extent of the breach, and would be determined by the courts or relevant authorities in accordance with applicable legislation.