Keeping the costs down

pharmacists standing by upward graph made of pills

Experts say action needed to curb rising PBS costs

The cost of the PBS is once again on the rise, according to a new report prepared by the Parliamentary Budget Office.

The report, released this week, shows a $3.3 billion increase in PBS spending between late last year and the 2016/17 Federal Budget, according to industry newsletter Pharma Dispatch.

“Relative to the 2015-16 MYEFO, policy decision are expected to increase spending on the PBS by $3.3 billion over the five years to 2019-20,” the report says.

The authors said this increase was “largely reflecting the listing of high-cost drugs for the treatment of Hepatitis C.”

Health Minister Sussan Ley announced the listing of the new Hepatitis C medicines – Sofosbuvir with ledipasvir (Harvoni); Sofosbuvir (Sovaldi); Daclatasvir (Daklinza); and Ribavirin (Ibavyr) – in December 2015.

A number of experts have called for a national register of cost-effective drugs for public hospitals to combat the rising PBS cost from expensive new medicines.

Dr Charles Denaro, Associate Professor of Medicine at the University of Queensland said a range of expensive new treatments posed a challenge for the health system.

“Each hospital has a formulary or register of drugs that can be used, but deciding whether to add an expensive new drug is problematic because hospital budgets are capped,” he said.

“Decisions across Australia are haphazard and access to drugs might depend on where a patient lives.

Dr Denaro said the increase in costs had largely been driven by expensive new biological therapies, antivirals for HIV and hepatitis C, and molecules used to treat some cancers.

“It is encouraging that medical advances are producing innovative new treatments but incredibly challenging to find funding while not re-allocating resources from other areas of health care,” he said.

Professor Jennifer Martin, chair of Clinical Pharmacology at the University of Newcastle, said more surveillance was required to assess the clinical outcomes of new drugs.

“There needs to be funding for independent assessment – and those drugs that don’t live up to their initial promise should be considered for removal from the PBS.”

Professor Martin and Dr Denaro are recommending an electronic national register for all Australian hospitals, funded by the Commonwealth and regularly updated by a national committee.

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