RMI - The Researched Medicines Industry News Line

Comprehensive review of medicines policy needed

The Researched Medicines Industry Association welcomes the appointments of Hon Pete Hodgson and Hon Peter Dunne to the Health portfolios.

Dr Pippa MacKay, RMI Chairman, said the Association is looking forward to engaging with the Ministers in order to explore the implications of the agreement between United Future and the Government for development of a long term medicines strategy relating to quality pharmaceutical usage in the health sector, including the role PHARMAC should play in implementing that strategy.

"We hope the development of this strategy will be independent of Crown agencies and will look at wider issues than simply the laudable objective of having a quality use of medicines strategy. Such a strategy is fully supported by the RMI, but, on the surface does not cover the wide range of issues needed in an acceptable access to medicines and funding policy", she said.

The need for a comprehensive review is fully endorsed in the recently published Time to Take a Fresh Look report by Dr Alex Sundakov from Castalia. This found that there is evidence to suggest that restricted access to pharmaceuticals has had a negative impact on New Zealand's disability burden and health outcomes, and suggests that New Zealanders may be more disabled than comparable populations, in part due to the difficulty in managing conditions when access to effective pharmaceuticals is restricted or denied.

It also found that there also appears to be evidence that restrictions on pharmaceuticals are shifting costs to other more invasive, costlier treatments. The public also agrees a review is needed. "There needs to be better access to new medicines and doctors should have more input into PHARMAC's decisions" said independent UMR research of 750 New Zealanders aged 18 and over released in late August. This shows that of 68% of respondents support an independent review of PHARMAC.

Dr MacKay said that the RMI fully endorsed and supported the calls for a far-reaching review of New Zealand's pharmaceutical policy.

Australian Government happy with PBS model

“The Government plans no radical changes to the Pharmaceutical Benefits Scheme which has served Australia well for many years. And, any changes that the Government proposes to make to the scheme will be put in place in the closest possible consultation with the industry,” Hon Tony Abbott, the Australian Health Minister said in Canberra on August 17.

“And, even though we often worry about the cost, the fact is that by international standards we get access to drugs at a very affordable rate.”

He outlined three broad areas to minimise the cost of the PBS but not damage its benefits.

Increased use of generic medicines

Reduction of cost through distribution methods

Co-payments, meaning patient bearing a fair share of costs.

The challenge: pharmaceuticals are costly investments

Drug development is risky as well as costly. Out of 5,000 - to 10,000 screened compounds:

- only 250 enter preclinical testing,

- five enter human clinical trials and

- one is approved by the US Food and Drug Administration.

The cost of developing a new drug is currently estimated at $US802 million and takes an average of 10 – 15 years to bring a new medicine from the laboratory to the pharmacy shelf.

This cost needs to be recovered by pharmaceutical companies before the patent term expires and generic versions of such drugs become available from other suppliers.

In New Zealand the period of time from market entry to expiry of patent is typically seven to eight years.

This is a significantly shorter "effective patent life" compared to other countries and is due to the length of time it takes PHARMAC to list a medicine for subsidy and that New Zealand intellectual property law does not provide for any for extension of protection to compensate for the erosion of patent life.

Comprehensive review of medicines policy needed The Researched Medicines Industry Association welcomes the appointments of Hon Pete Hodgson and Hon Peter Dunne to the Health portfolios. Dr Pippa MacKay, RMI Chairman, said the Association is looking forward to engaging with the Ministers in order to explore the implications of the agreement between United Future and the Government for development of a long term medicines strategy relating to quality pharmaceutical usage in the health sector, including the role PHARMAC should play in implementing that strategy. "We hope the development of this strategy will be independent of Crown agencies and will look at wider issues than simply the laudable objective of having a quality use of medicines strategy. Such a strategy is fully supported by the RMI, but, on the surface does not cover the wide range of issues needed in an acceptable access to medicines and funding policy", she said. The need for a comprehensive review is fully endorsed in the recently published Time to Take a Fresh Look report by Dr Alex Sundakov from Castalia. This found that there is evidence to suggest that restricted access to pharmaceuticals has had a negative impact on New Zealand's disability burden and health outcomes, and suggests that New Zealanders may be more disabled than comparable populations, in part due to the difficulty in managing conditions when access to effective pharmaceuticals is restricted or denied. It also found that there also appears to be evidence that restrictions on pharmaceuticals are shifting costs to other more invasive, costlier treatments. The public also agrees a review is needed. "There needs to be better access to new medicines and doctors should have more input into PHARMAC's decisions" said independent UMR research of 750 New Zealanders aged 18 and over released in late August. This shows that of 68% of respondents support an independent review of PHARMAC. Dr MacKay said that the RMI fully endorsed and supported the calls for a far-reaching review of New Zealand's pharmaceutical policy. Australian Government happy with PBS model “The Government plans no radical changes to the Pharmaceutical Benefits Scheme which has served Australia well for many years. And, any changes that the Government proposes to make to the scheme will be put in place in the closest possible consultation with the industry,” Hon Tony Abbott, the Australian Health Minister said in Canberra on August 17. “And, even though we often worry about the cost, the fact is that by international standards we get access to drugs at a very affordable rate.” He outlined three broad areas to minimise the cost of the PBS but not damage its benefits. Increased use of generic medicines Reduction of cost through distribution methods Co-payments, meaning patient bearing a fair share of costs. The challenge: pharmaceuticals are costly investments Drug development is risky as well as costly. Out of 5,000 - to 10,000 screened compounds: - only 250 enter preclinical testing, - five enter human clinical trials and - one is approved by the US Food and Drug Administration. The cost of developing a new drug is currently estimated at $US802 million and takes an average of 10 – 15 years to bring a new medicine from the laboratory to the pharmacy shelf. This cost needs to be recovered by pharmaceutical companies before the patent term expires and generic versions of such drugs become available from other suppliers. In New Zealand the period of time from market entry to expiry of patent is typically seven to eight years. This is a significantly shorter "effective patent life" compared to other countries and is due to the length of time it takes PHARMAC to list a medicine for subsidy and that New Zealand intellectual property law does not provide for any for extension of protection to compensate for the erosion of patent life.	Vol1 / No1 / November 2005 Anti-flu donation to WHO Three million courses of the antiviral drug, Tamiflu, have been donated by Roche Pharmaceuticals to the World Health Organisation to help in the possible event of a bird flu pandemic. Government health spend on pharmaceuticals – public spend as a percentage of vote health
	Suggested reading The Economic Cost of Arthritis in New Zealand, a report by Access Economics Pty Ltd, for Arthritis New Zealand June 2005. Exposing the myth, clinical research trials, why aren’t we a bigger player? By Bette Flagler, Unlimited, September 2005 Is there an oncologist in the House? By Margot Butcher, North & South, September 2005
This newsletter is published on behalf of the Researched Medicines Industry Association of New Zealand. The views and opinions expressed in this publication are not necessarily those of the RMI. Subscribe Unsubscribe - Please remove me from your emailing list	For further information: The Researched Medicines Industry Association Inc PO Box 10447 Wellington Phone 04 499 4277 www.rmianz.co.nz

Comprehensive review of medicines policy needed

Australian Government happy with PBS model

The challenge: pharmaceuticals are costly investments

Anti-flu donation to WHO

Government health spend on pharmaceuticals – public spend as a percentage of vote health

Suggested reading