PBS cuts would pose threat to high-value jobs

Hundreds of high-wage, high-skill jobs in Australia’s $18bn pharmaceutical industry are under threat from the global economic crisis, Medicines Australia chief executive Ian Chalmers warned today.

Mr Chalmers said the Government could protect jobs and encourage foreign investment in Australia’s pharmaceutical industry by ensuring there were no further cuts to the Pharmaceutical Benefits Scheme, and by implementing key industry support measures.

“The pharmaceuticals sector is Australia’s second most valuable export industry, after the automotive industry,” Mr Chalmers said.

“We employ over 40,000 Australians in high-value jobs. Local pharmaceutical companies attract upwards of $1 billion a year in R&D investment, and export Australian produced medicines worth $4 billion annually. Those exports offset pharmaceutical imports by more than 50 per cent.

“We can continue to deliver a tangible benefit to Australia’s ailing economy, but we need the Government to provide commercial certainty and stability. They can do that by ensuring the Pharmaceutical Benefits Scheme continues to be fully funded.

“The economic reality is that the PBS is not a cost to Government. It’s an investment which delivers substantial savings in other areas of the healthcare system.

“It would be a false economy to gouge Budget savings from a Federal health program that delivers a net saving to the state health system. The PBS effectively keeps patients out of hospitals, shortens hospital stays when they are needed, and reduces the burden of illness for virtually every Australian family.

“Any cut to the PBS would be bad news for patients, and ultimately bad news for the economy.

“The major reform of the PBS, which began in August 2008, will save the Government more than $650 million over the next four years and upwards of $6 billion over 10 years. Pharmaceutical companies have already delivered massive savings to Government.

“The industry now needs commercial certainty. Any further unexpected cuts to the PBS, especially at this time of economic stress, could have serious consequences for the pharmaceutical industry and high-wage Australian jobs.”

Mr Chalmers further encouraged Government to implement the recommendations of the Pharmaceuticals Industry Strategy Group, which reported to Innovation Minister Kim Carr in January.

The PISG set out a cost-effective strategic plan to boost global investment in Australia’s pharmaceuticals industry.


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