DISSENTING REPORT BY COALITION SENATORS
Introduction
Coalition Senators do not support
the conclusion of the majority report that the draft regulations
“satisfactorily address the issues that were raised during the Committee’s
earlier inquiry into the National Health Amendment (Pharmaceutical and other
Benefits – Cost Recovery) Bill 2008” because clearly that contention is not
supported by the weight of evidence presented to the committee.
Clearly there remains significant
opposition to the proposal to move to cost recovery, and the concerns
surrounding that proposal have not been mitigated by the release of the draft
regulations.
This was best articulated by Professor
Carney, Chair of the Therapeutics Advisory Committee, Royal Australasian College
of Physicians
Prof. Carney—I would first like to thank you for allowing the
college and myself to comment on this PBAC funding cost recovery model again.
The last time, when I was in Canberra and commented on this, I mainly tried to
raise various issues and did not really come up with a decision as to what the
college and its affiliated speciality societies felt about the proposal. Since
then, I have had a chance to talk not only within the college, including my
therapeutics committee, which met two days ago, but also to a number of
affiliated specialty societies—not all, but a fair number including oncology,
rheumatology, paediatrics, geriatrics, nephrology, cardiology and a couple of
others. We have a large number of the various specialty groups, specialist physicians
around the country who are associated with the college. Following those
discussions, I can say with some confidence that there is no support for
the proposal before the Senate at the moment. (emphasis added)
and
CHAIR—My understanding is that you still have concerns, the ones
you had when you originally gave evidence. You do not, at this stage, feel as
though you have had them addressed?
Prof. Carney—No, I have not. I see the system as
unchanged and with the potential for getting worse. I can understand the
government’s problems in the Senate at the moment; we all read about that in
the paper—probably a bit too much! But I wonder whether the amount of money the
government will get from it is really going to be worth it in the long term.
Coalition Senators note that it
has not been practice to release draft regulations prior to the passage of
legislation and appreciate that the committee has had the opportunity to
provide this scrutiny on behalf of the Senate. We are concerned however that
the draft regulations were not released until after the committee had reported.
We also concur with the majority
report that considerable time and effort would have been saved by the committee
and the Senate had the draft regulations been available during the earlier
inquiry into the Bill.
Consultation
There remains a considerable
difference of opinion between the Department of Health and Ageing (DoHA) and
industry over the definition and quality of consultation on the draft
regulations.
We reiterate our view that it is
unreasonable to assert that there was a seamless process of consultation
between the two governments pre- and post the 2007 election.
We further express concern that
the perception that forwarding the draft regulations to certain members of industry
with an invitation to respond with any issues is genuine consultation,
particularly given that the consultation process had been questioned in the
previous inquiry.
This is born out by the fact that
only two of those circulated (12) responded to the information circulated.
Medicines Australia stated the
following in relation to previous experience of consultation with the
Department
Senator COLBECK—So, from your experience of consultation with the
department, you would have difficulty in calling this ‘consultation’?
Mr Delaat—Absolutely.
We would have great difficulty in defining this as consultation.
A similar response was received
from the Australian Medical Association with the added perspective that the
interaction of the measure with the Senate process had influenced expectations
to consultation.
Senator COLBECK—Basically, I think we are on the same track. Can I go
back to your interactions with the department since the last hearings and in
particular since the report came out? What communications has there been
between the AMA and the department in respect of the issue of initially the
draft regs and then the second incarnation that had the explanatory notes
attached?
Mr Sullivan—We
received those from the department by way of its normal dissemination of
information. I have not had direct dealings with the department. We have not
had any interaction with the department in the interim.
Senator COLBECK—Were there any specific requests that came with the
documentation? You were basically just provided with that as part of an
information process?
Mr Sullivan—It
is my understanding that it is the latter: the dissemination of information
from the department.
Senator COLBECK—So
it could not be called a consultation process.
Mr Sullivan—We
have not been consulted per se. Like many groups we have been watching the
political debate in the Senate and we responded accordingly to this process.
Therefore our understanding of how things will work is the same as everybody
else’s.
Senator COLBECK—So your response has effectively been to this
committee process rather than necessarily the department or the government at
this particular time?
Mr Sullivan—That
is correct.
These responses reinforce
previous concerns expressed by Coalition Senators regarding consultation on
this measure.
Operation of Regulations
It was obvious from evidence that
the provision of the draft regulations has given industry and those interacting
with the Pharmaceutical Benefits Scheme a much better understanding of the
operations of the measure than briefings provided by the department, and that
the process had prompted some amendments.
It is clear however that the
release of the regulations had not allayed concerns regarding the concept of
cost recovery for the PBS.
Mr Sullivan—...the AMA would like to reiterate its concern about
the government policy to introduce cost recovery for the Pharmaceutical
Benefits Advisory Committee process. There is no net benefit to the Australian
people in requiring pharmaceutical companies to pay application fees for PBS
listing processes. These companies will simply factor this cost into their
listing prices and claim them as legitimate business expenses for tax purposes.
The potential consequence for the Australian people is that companies will decide
there is no business case to bring a low-volume, low-priced product to the
Australian market. These will be medications for small populations, medications
for palliative care, oncology and our Indigenous Australians, for example.
and
Senator COLBECK—You say that the draft regs do not adequately address
your concerns. Fundamentally, can that be changed or do you have a basic view
that cost recovery is not the process to be undertaken with respect to this
particular measure?
Mr Sullivan—Yes. In the spirit of the AMA’s engagement we are
trying to make something we think is not so good maybe slightly better. As we
said in our first submission and I tried to reiterate, we do not believe cost
recovery should apply in this field.
The Department had also indicated
that the regulations were framed and would operate in a similar manner to those
of the Therapeutic Goods Administration (TGA), the terms and procedures of
which industry is quite familiar.
The proposed similarity between
the two processes however was an additional point of concern with those at the
coal face dealing directly with patients
Senator COLBECK—I understand what you are saying but given that a
lot of the precedents and process that is proposed for the PBAC process is
lifted from the TGA process that would I presume reinforce your concerns?
Prof. Carney—Yes. It would be just be PBAC running
the way TGA does. That is my big concern because we are finding it extremely
difficult. As I said certain groups now put it on their websites. You will find
if you go to the MOG website, which is one of the groups, you will see
medications. If you look at the indications approved by TGA, and you look at
theirs, they are quite different. Because they have decided that for their
members and their patients they will put it down as they see it. There are
legal issues in this of course. I do not quite know how they are going to be
resolved. It is an area of confusion but again I would not want to see PBAC end
up being in a situation where they are tied by having to get the money and then
having to rely on
industry who are going to say, ‘What’s in it for us?’
Conclusion
Coalition Senators reaffirm their
view that cost recovery not be pursued, with that view supported by the
overwhelming weight of evidence at both inquiries conducted into this measure.
Senator Gary Humphries
Senator
Judith Adams
Senator Sue Boyce
Senator
Richard Colbeck
Senator Scott Ryan
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