Wednesday, November 16, 2011

Pharmaceutical Benefit Scheme Policy: State of Play in 2011 and Future Issues

On Wednesday 19 October I attended the presentation given by  Emeritus Professor Lloyd Sansom at the University of Canberra along with Russell McGowan, Olivia Macdonald and Denis Strangman (ACT Cancer Services Consumer Reference Group).

Professor Sansom’s presentation included a brief history from when the Pharmaceutical Benefits Scheme PBS began, covering the period 1944 to the present.  In 1946 legislation was amended to include the PBS.  In 1946 the decision was that cost was not a consideration if it adds benefits and that no-one was barred from being an eligible user.  He also drew comparisons between the Australian system and those in place in Canada and the US.

Following are a few of the numbers and statistics Professor Sansom shared with us during his detailed presentation:
PBS represents $8.4billion per annum of government spending
the current trend for the growth rate of PBS expenditure exceeds GDP. It is worth noting that the percentage of spending in Australia is 9% of GDP and in the USA it’s 18%
total cost of PBS is $365 per person per annum  (based on information sourced from DoHA, Department of Veteran’s Affairs and Medicare Australia)
special arrangements have been put in place for indigenous groups
among the top drugs in use are Atorvastatin and Rosuvastatin (both of which are statins used in the treatment of high blood pressure) and Clopidogrel.

Professor Sansom gave an outline of the Therapeutic Goods Administration’s (TGA) decision making and assessment process, how it is based on clinical control data and has a duration window of seventeen (17) weeks for a drug to be assessed and if applicable legislation changed. He also stated that the process involved in the decision making came down to the three fundamental questions of:
can a drug work?
does a drug work?, and
is it worth it?

The method for assessment is based on the ICER (Incremental Cost Effectiveness Ratio):
Cost new – Cost comparator
Outcomes new – Outcomes comparator

On the question of ‘Is the PBS affordable?’, Professor Sansom talked about the National Medicine’s Policy.

Of interest to consumers is that drug companies are now being pushed to ensure they seek  patient feedback when making some assessments. Prof Sansom gave an example of this for a  medication prescribed for patients with difficulty walking.

Professor Sansom noted that tensions exist between optimal health outcomes and cost.  Is the consumer getting value for money? He also acknowledged the absence of an accurate method of measuring the effectiveness of the PBS in the long term due to the high level of complexity that exists between the measurement tools used.

In response to the question ‘have we got our system right in this country?’. In a nutshell, Professor Sansom’s view is that considering the constraints imposed - we do.

A recent ‘consumer jury’ verdict on end of life revealed that people value end of life and are willing to prolong life in order to end it on their own terms – mainly to reach key life milestones like seeing their children marry or provide them with grandchildren.

Professor Sansom ended up by speaking briefly about the role of the media and how a misleading announcement with the headline ‘patients denied cancer drug’ imparted  a wrong impression.  The actual reason for the drug being denied public subsidy was due to it being no more effective than one already on the market except that the new one had unnecessary laxative qualities which the committee didn’t think they should impose on consumers unnecessarily.

Kerry Burton
NAP Consumer Coordinator

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