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Vol 23- May
2009
Increased medicines funding
expected in May Budget
Since the establishment of PHARMAC in 1993, pharmaceutical expenditure has averaged a growth of just 2% per year, less than the average rate of inflation said an OECD report Healthcare Reform: Challenges for the Next Phase which was released in April. This
report was highly supportive of PHARMAC but warned that if
Government really wishes to fund expensive new drugs it should
expand PHARMAC’s budget and not interfere in its decision
making.
Clinicians and patients alike are awaiting a promised ‘substantial’
increase in funding expected in the May Budget. According to a
political column in the NZ Doctor Health Minister, Hon Tony Ryall
has indicated that the increase would widen the scope of the
medicines PHARMAC could buy.
National promised a $180m increase over three years in the election
campaign and Mr Ryall is quoted as suggesting that previous
increases “certainly didn’t keep up with population growth.
“The
new Government’s plan is to move to catch up with population growth
over the next three years,” he is reported to have
said.
However, the promised increase of $180m might not be quite what
people are expecting as we understand that it will come off a fixed
base. The increase in funding in years one, two and three would not
be an additional $40m, $60m and $80m in each of the respective
years, but rather an increase of $40m, $20m and $20m of additional
funding in each of the three years.
Apology
The RMI apologises for an error in the graph in the last
e-zine. In the last issue of this newsletter we incorrectly
depicted the 2008/09 community schedule budget as $533m, instead of
$653m. The correction is in the graph below which illustrates
the effect of a three year budget increase calculated from a flat
base.
Additional funding for medicines  Counterfeit medicines, a growing concern According to the World Health Organisation more than
50% of medicines purchased on internet sites without a physical
address are counterfeit.
It also says that between 6% and 10% of medicines on
the world market are reported to be counterfeit with estimated sales
of over US $35 billion a year. The problem is most serious in
developing countries.
The 61st World Health Assembly considered a report on
counterfeit medical products in May last year, but has been unable
to reach agreement on an international approach to the problem.
 Meanwhile the problem grows. Counterfeit
medicines are potentially extremely dangerous, with no controls over
what they contain. Chilling stories about the risks associated
with counterfeit medicines are becoming more and more
common.
New Zealand is not immune to the growing problem which
is an additional burden to already hard working border control
officials both here and overseas.
For instance, the United Kingdom’s Medicines and
Healthcare products Regulatory Agency (MHRA) seized nearly half a
million pounds worth of counterfeit medicines in March this year in
Middlesbrough, England.
In the US a PhRMA survey found that a significant
number of American adults had recently purchased medicines from a
foreign country. Half of those surveyed are buying their drugs in
another country because they lack a doctor’s prescription. What’s
more, the survey found that antibiotics and pain relief medicines
are, in most cases, the typical medications American consumers seek
from other countries.
The Australian regulator, TGA, has issued a public
warning over imports of counterfeit medicines into Australia.
It says that, over recent months, there has been an increase in the
personal importation of lifestyle products claiming to contain only
herbal ingredients but actually including pharmaceutical
actives.
“Regulators in developed countries, such as Medsafe
here in New Zealand, ensure that medicines prescribed by clinicians
and dispensed by pharmacists are safe, effective and high quality
products. Counterfeit products purchased over the internet
have no such safety evaluation and should be avoided,” said Ken
Shirley, the CEO of the Researched Medicines Industry
Association.
Read more about the problems with counterfeit
medicines here www.BuySafeDrugs.info
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Pharmacoeconomics
seminar
Some 25 representatives of RMI member companies
attended a PHARMAC presentation in Auckland on Friday 24th April
outlining the details of cost utility analysis (CUA) – why it is
used and how it is done.
A commonly expressed industry concern was the lack of transparency
in the processes associated with determining priorities for the
funding of medicines. It was also acknowledged that any new
investment in pharmaceuticals is subject to an extremely stringent
evaluation compared with other investments in the health
sector.
Parliamentary examination of
PHARMAC
The pharmaceutical schedule was under
spent again over the 2007-08 financial year, by $400,000
Parliament’s Health Select Committee was told in late March.
“While this is a
foregone opportunity in pharmaceutical investment, it must be
pointed out that it represents a mere 0.06% of the total community
schedule budget. It would seem that greater flexibility and a
carry-over provision would be the only way of ensuring that the full
amount of money budgeted by DHBs for medicines is spent on those
items,” the RMI CEO, Ken Shirley,
commented.
The Select Committee
was also told by Pharmac CEO Matthew Brougham that it has two
current key challenges; the public acceptance of generics and the
increasing cost of some new
medicines.
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