US policy challenges Australia’s PBS

The Federal Government has reiterated the pressures being felt by Australia’s Pharmaceutical Benefits Scheme (PBS), as the scheme takes the weight of policy moves in the United States.
 
Speaking at the Pharmacy Guild of Australia’s annual parliamentary dinner, which brought together some 400 guests including parliamentarians, stakeholders and pharmacists, Federal Minister for Health and Ageing Mark Butler highlighted ‘real pressures’ being placed on medicine access and affordability.
 
He also spoke of global challenges from the US Government’s move towards ‘most-favoured-nation pricing’ as well as flagging a potential for the delisting of medicines under the PBS, the Australian Journal of Pharmacy (AJP) reports.
 
‘All of the big pharmaceutical companies that supply the terrific medicines that you dispense, at the moment at least, to your patients, are under real pressure,’ Minister Butler told attendees.
 
‘That pricing is going to create some challenges for governments – not just the Australian Government, really all governments outside the US, particularly developed economies.  
 
‘That will mean a lot of pressure, a lot of debate around access, around new listings, around the possibility of delisting of existing PBS medicines, that will impact the way in which your customers talk to you about access and affordability.’
 
RACGP Expert Committee – Quality Care Chair Professor Mark Morgan said it is not yet clear what the full implications of US tariffs and America-first policy will be on the cost of medicines going forward, however delisting medicines is concerning.
 
‘For individual patients, having their medication de-listed from the PBS is distressing and harmful,’ he told newsGP.
 
‘I hope any decisions about de-listing will only be made after a transparent process. The voice of GPs and patients both need to be heard in the decision-making process.’
 
Professor Morgan said Australians need access to effective, affordable medication, and ‘we are lucky in Australia to have systems in place that maintain the quality and access to medicines’.
 
However, there are shortfalls, and there is room for improvement, he noted.
 
‘Where Australia falls behind is onshore manufacturing of medicines and adequate warehousing. We seem to have medication shortages far too often,’ Professor Morgan said.
 
‘I would like to see thriving local manufacturing of pharmaceuticals to mitigate some of the risks from lack of supply. I wonder whether there could be arrangements for local manufacturing under licence where US companies manufacture in Australia and visa versa.’
 
Another big gap, Professor Morgan added, comes from the lack of funding for the development of new medicines.
 
‘Pharmaceutical companies need to cover huge research and development costs that makes these medicines very expensive,’ he said.
 
‘The need to recoup costs of development also means a lack of investment in producing medicines for low volume conditions. This is bad news if you have a rarer condition.’
 
Professor Morgan believes there is a ‘huge opportunity for better prescribing decision support at the coal face’.
 
‘For example, we know the majority of people at high risk of cardiovascular disease are not treated while many people at low risk are treated,’ he said.
 
‘Overall, prescribing decisions are a much greater impact than the marginal benefits of a newer medication over an existing off-patent medication.’
 
Minister Butler’s speech comes as US President Donald Trump announced ‘the most significant actions ever taken by our Federal Government to lower prescription drug prices’, unveiling agreements with two major drug manufacturers as it steps towards most-favoured-nation pricing.
 
In July, President Trump sent letters to leading pharmaceutical manufacturers outlining the steps they must take to bring down the prices of prescription drugs in the US to match the lowest price offered in other developed nations.
 
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