Rachel Siewert (WA, Australian Greens) Share this | Link to this | Hansard source

by leave—I move Greens amendments (1) and (2) on sheet 5823 together:

(1)   Schedule 1, item 1, page 3 (after line 19), at the end of section 99YB, add:

(2)    Schedule 1, item 1, page 5 (after line 5), at the end of Division 4C, add:

Review

        (1)    The Minister must cause an independent review of the impact of cost-recovery measures provided for under this Division and any regulations made under this Division to be undertaken as soon as possible after the second anniversary of the commencement of this Division and completed within 4 months of that anniversary.

        (2)    The review must report on:

             (a)    the average number of times a submission is presented before gaining approval and the reasons provided for requiring applicants to resubmit;

             (b)    the average fee for submissions by type of submission (major/minor/generic according to Department of Health and Ageing classifications);

             (c)    the number of applications where the population is likely to be small and utilisation of the drug, medicinal preparation or vaccine is likely to be highly targeted;

             (d)    the number of reviews requested by applicants;

             (e)    the number of fee waivers given to applicants and the reasons why waivers were given;

              (f)    the length of time taken for submissions to be approved;

             (g)    the number of applications that fail to gain a listing, the reasons why and the types of drugs concerned;

             (h)    any increase in operating costs of the Pharmaceutical Benefits Advisory Committee;

              (i)    any increase in the cost of pharmaceutical benefits scheme medications to patients;

              (j)    any other matters considered relevant.

        (3)    The review must be conducted by a panel which must comprise not less than 5 persons, including:

             (a)    a medical professional nominated by the Minister;

             (b)    a nominee of the Consumers Health Forum of Australia;

             (c)    three other persons nominated by the Minister, each of whom must have relevant professional qualifications and must not be employed within the pharmaceuticals industry.

        (4)    The panel must give the Minister a written report of the review, and the Minister must cause a copy of the report to be tabled in each House of the Parliament within 15 sitting days of receiving the report.

Annual report on processes

        (5)    The Secretary must, as soon as practicable after 30 June in each year, prepare and give to the Minister a report on processes leading up to the Pharmaceutical Benefits Advisory Committee consideration, including:

             (a)    the extent and timeliness with which responsible persons are provided copies of documents relevant to their submission to the Pharmaceutical Benefits Advisory Committee;

             (b)    the extent to which responsible persons exercise their right to comment on these documents, including appearing at hearings before the Pharmaceutical Benefits Advisory Committee;

             (c)    the number of responsible persons seeking a review of a Pharmaceutical Benefits Advisory Committee recommendation.

        (6)    The Minister must cause a copy of each report prepared under subsection (5) to be tabled in each House of the Parliament within 15 sitting days of receiving the report.

These two amendments—as I touched on in my speech in the second reading debate—relate to an increase in the transparency and accountability of the application of the cost recovery process. The amendments will establish an independent review of the impacts of the cost recovery measures, to take place two years after the commencement of this process and to be completed within four months. They set out the composition of the independent panel, which will include a medical professional nominated by the minister, a representative of the Consumers Health Forum and three other persons, nominated by the minister, who must have appropriate professional qualifications and not be associated with the pharmaceutical industry. The minister must table the report of the review in the House within 15 days of its receipt.

The purpose of the review is to ensure that the introduction of a cost recovery process is subject to thorough transparency and accountability and to provide detailed information on the submissions made for approval under the new regime. This information will include the level of fees imposed, the number of fee waivers, the type of submission, the length of time for approval and the number of times a submission has been presented before gaining approval, and it will provide important data on the effectiveness of the process. Importantly, the review will also provide information about the impacts of the cost recovery measure on the production and cost of low-volume, low-population drugs—in other words, those non-orphan drugs in particular. The review will investigate the impact on the operating cost of the Pharmaceutical Benefits Advisory Committee and whether there is a flow-on effect in terms of increased cost of Pharmaceutical Benefits Scheme medications to patients. That is the first set of amendments.

The other set of amendments—as I also highlighted previously—we discussed with the opposition. It relates to the tabling of an annual report by the secretary of the department. That will detail the processes leading up to the PBAC consideration of submissions and will document the timeliness of the provision of documents, the commentary on the applications to the PBAC and the number of requests for review of the PBAC recommendations.

These reporting measures will again increase the transparency of the process through which pharmaceuticals are included on the PBS and the introduction of the cost recovery mechanism. We believe these are sensible and reasonable measures which will increase the transparency and accountability of this process and, hopefully, provide very useful information to determine whether the cost recovery process is having an adverse impact. As you can see, they have been very tightly written to enable full review of the process and there are very strict time lines around when the review is to be done, how long it is to take and when it is to be tabled in parliament. Again, this is designed to increase transparency and accountability.

We think these amendments enhance the bill and will provide useful information for future decision making around cost recovery and around the PBS, which, as Senator Faulkner rightly pointed out, is a very important scheme in this country—one of the best in the world. We want to make sure that that scheme is protected and is enhanced and ensure that the measures in this bill are not in some way undermining the effectiveness and efficiency of the PBS. I commend the amendments to the chamber.

Mathias Cormann (WA, Liberal Party, Shadow Parliamentary Secretary for Health Administration) Share this | Link to this | Hansard source

I state for the benefit of the chamber that the opposition will be supporting the Greens amendments. In fact, they are very similar to amendments that the coalition pursued with the government. The context is that we remain concerned about some of the risks that are inherent in the legislation pursued by the government here today. They are risks that the minister herself identified in opposition—risks to the independence of the PBAC, among other things.

The coalition are great supporters of the PBS, just as we are great supporters of Medicare and great supporters of private health insurance. In fact, under the Howard government, expenditure on pharmaceutical benefits increased from $2.2 billion in 1996-97 to $6.4 billion in 2006-07. Whilst we have given an indication that we will support the bill, we do think that these amendments moved by the Greens are necessary to give proper reassurance to the industry and to the Australian community that the integrity of the PBS is not being compromised.

We support the proposition of a review after the second anniversary of the commencement of this bill and for the review to be completed within four months of that anniversary. We support the amendments around the annual report on processes. We commend the Greens, we commend Senator Siewert, who has moved these amendments on behalf of the Greens, and we commend the amendments to the chamber.

Chris Evans (WA, Australian Labor Party, Leader of the Government in the Senate) Share this | Link to this | Hansard source

I indicate that the government has been swayed and convinced by Senator Siewert’s advocacy and on this occasion we will be voting for the amendments.

Question agreed to.

Bill agreed to.

Bill reported with amendments; report adopted.