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Spend more of health budget on making people better
21 August 2009

The Researched Medicines Industry (RMI) is urging the Government to continue its efforts to spend more of the health budget on front line treatment of patients.

RMI Chairman Dr Pippa McKay says international evidence is stacking up that New Zealand is wasting more money inside its health system than other Western countries.

She was responding today to media coverage of a World Health Organisation report that New Zealand spends more of its GDP on health than many other countries but gets worse health outcomes.

The report highlights that over nine per cent of New Zealand's gross domestic product is spent on the health system, although it only ranks 15th in the world in terms of quality outcomes. This is poor value for money compared to Australia which spends 8.7 per cent of its GDP and ranks second in the world. Britain spends just over eight per cent on a health system which is ranked seventh in the world.

"The evidence is overwhelming - we're spending more money on the health system but the outcomes are not as good as other countries," Dr MacKay says.

"The answer is not cost-cutting, but better use of current spending on productive activity - things that treat patients."

"It is no coincidence that overall health spending increased over the last decade without gains in productivity while at the same time, spending on medicines fell from 14.4% in 1997 to 9.6% in 2007. If you want better health outcomes, then spend more on medicines that make people better," she says.

Ends.
For further information contact Dr Pippa MacKay, RMI Chairman 027 448 4718.

Background
Medicines save lives, reduce symptoms, and cure disease. They are a vital component of any modern health service.

The Researched Medicines Industry Association (RMI) represents 19 pharmaceutical companies engaged in the research, development, manufacture, and supply of medicines in New Zealand.

RMI is committed to improving the lives of New Zealanders by providing access to medicines of the highest quality, safety and efficacy.

RMI is currently encouraging the New Zealand Government to double its current expenditure on medicines from 9% of the health budget to the OECD average of 17%. This is likely to at least double the number of people who enjoy better lives thanks to the astute use of medicines.

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