Home' Australian Pharmacist : Australian Pharmacist May 2016 Contents Australian Pharmacist May 2016 I ©Pharmaceutical Society of Australia Ltd. 21
The past month has shown unsettling glimpses of potential futures for
medicine costs in Australia.
The month started with PBS price
reductions of 20% to 60% for more than
Announcing the price reductions, Health
Minister Sussan Ley said many common
medications would reduce in price by as
much as $20 per script.
She said this was just the start, with
further price reductions of as much as
50% or more coming in October 2016
when price calculations for thousands
of common PBS medications would
reflect the cost of cheaper generic
versions, rather than more expensive
On the upside, she said the Government
was 'bolstering the future sustainability
of the PBS and our ability to invest in
new medicines by ensuring taxpayers
are paying fair prices for drugs currently
protected against competition.'
However, for every action there is a
reaction, and the reaction was not long in
coming. On 13 April, Apotex announced
it was ceasing supply of two PBS listed
prescription products once present stock
was exhausted. They are: paracetamol/
codeine tablets 500mg/30mg Blister Pack
20; Cephalexin Suspension 125mg/5ml
Bottle 100ml, and Cephalexin Suspension
250mg/5ml Bottle 100ml.
Announcing the withdrawal, Apotex
Managing Director, Roger Millichamp
said ongoing price reform pressures
had placed these products' pricing
to customers at less than the cost of
'While Apotex is committed to and
supports ongoing reliable access to
affordable generic medicines, a strong PBS,
and a sustainable generic medicines sector
for patients, continuing price reductions
could compromise the industry's ability to
ensure patients continue to have access
to essential medicines in the future,'
Mr Millichamp said.
The question now is: will other companies
follow suit and withdraw products from
the PBS, and from sale in Australia?
All this sounds suspiciously like a
scenario that the Chair of the Review of
Pharmacy Remuneration and Regulation,
Professor Stephen King, mentioned
during his presentation at the APP
conference in March. Facing an at best
cynical and at worst downright hostile
audience, he said the Government
worked on a tender system because it
realised it has 'no clue what the costs
are, and there's no way you can find
them out. But that's how community
pharmacy is being operated and funded.'
Professor King then posed the question:
'How does the Government work out
what is the sustainable funding needed
for your services without tying you guys
[pharmacy owners] up in red tape'.
He said, 'the alternative is, by the way, the
Government says yeah let's see how hard
we can squeeze them until they squeal.
We'll find out what's sustainable because
we'll just keep on lowering the amount
community pharmacies get until they
start going out of business. That's how
we'll know whether it's sustainable or not.'
The PBS changes stemming from
advanced price disclosure -- announced
under both Coalition and Labor
Governments -- especially those
announced in April and the changes
foreshadowed for October look
suspiciously like successive Federal
Governments have already 'squeezed'
with the squeezing is set to continue.
In the past few years, the number
of pharmacies going bust has
However, Minister Ley -- also speaking at
APP -- was quite definite that pharmacists
have a special role. 'With a workforce
of around 30,000 pharmacists and a
network of more than 5,500 community
pharmacies your profession has a major
contribution to make to consumers'
This statement might seem at odds with
the PBS 'squeezing' but, could a carrot
and stick be in use here? The obvious
savings on the health budget aside, could
advanced price disclosure be the stick
part of a broader plan to move pharmacy
towards a greater role in healthcare with
patient-centred care the overarching
theme? (Not quite a conspiracy theory,
more a grand plan perhaps.)
What then is the carrot? Well, is the
Pharmacy Trials Program designed
to allow pharmacy, and in particular
community pharmacy, to grow its own
carrots in the form of services?
At the time of writing, the Review of
Pharmacy Remuneration and Regulation
was due to release a Discussion Paper.
It may provide some hints about where
pharmacy and pharmacists are headed.
The carrot and
BY ANDREW DANIELS
Andrew Daniels is Managing Editor of Australian
Pharmacist. Opinions expressed in this column are
not necessarily those of the Pharmaceutical Society,
its Board or staff.
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