The Grattan Institute report into pharmaceutical premium pricing policy highlights “unnecessarily high” costs to patients and taxpayers of a health system it describes as complex and labyrinthine, says the Consumers Health Forum CEO, Leanne Wells.
“We accept the drug industry’s need for a reasonable profit to develop new drugs, but this report exposes a pricing system that imposes higher prices on some drug brands for no good evidence-based reason,” Wells says.
“The premium pricing policy not only tests logic but imposes unnecessarily higher costs on patients, it seems partly as a result of the lack of awareness among prescribing doctors and patients themselves about the cost impact on consumers and the taxpayer of the higher prices paid for premium brands.
“If reform of this area can generate $300 million in annual savings without disadvantaging patients, it would certainly be preferable to increasing the PBS co-payment as the Government still plans to do.
“As well, the report suggests that reform of the pricing policy could of itself provide more incentives for the drug industry to focus more on innovative new drugs instead of trying to extract higher prices in an already crowded market of equivalent drugs.”