Government pockets $7 billion in PBS savings

An independent report released by the Pharmacy Guild reveals the savings to Government from the 2007 Pharmaceutical Benefits Scheme reforms will be substantially greater than previous estimates.

The report by Illuminating Health Consulting and commissioned by the Pharmacy Guild concludes that the reforms will deliver a massive $7.4 billion in savings to Government over 10 years.

That is more than double the previous Government’s own estimate of $3 billion.

Medicines Australia chief executive Ian Chalmers said the new report should further convince the Rudd Government of the wisdom of quarantining the PBS from spending cuts in the Federal Budget.

“This report confirms the true extent of the savings which PBS reform will deliver to the Government.

“The Report highlights an extra $4.4 billion in savings, over and above Government projections. This also significantly exceeds earlier industry projections.

“Whichever way you dice it, it’s now clear that the Government will save at least $7 billion as a result of these reforms.

“The discovery-driven pharmaceuticals industry signed up to these reforms in good faith, in the interests of ensuring a sustainable PBS for future generations.

“This Report confirms that the pharmaceutical industry has done – and will continue to do – its share of the heavy lifting ahead of this Budget and beyond.

“In the last year PBS reforms have resulted in a loss of 5% of the workforce of Medicine Australia member companies. Any further unexpected cuts to the PBS would be damaging to the local industry and put more Australian jobs at risk.

“What the industry needs now is commercial certainty and stability.”

–ENDS–

Contact Person:

Jamie Nicholson
Media Communications Manager
Phone: 0419 220 293
Email: Jamie.Nicholson@medicinesaustralia.com.au