Price cuts mean PBS can afford new medicines
As the 1 April price cuts come into effect for 121 medicines, Medicines Australia reaffirms that the $20 billion in savings from ongoing Pharmaceutical Benefits Scheme price cuts have made the PBS sustainable.
“There is no need for further PBS savings measures in the upcoming Budget, rather we should be looking at ways to improve the process for listing new medicines to treat cancer, diabetes and other diseases,” Dr Brendan Shaw, Medicines Australia Chief Executive, said.
“It is estimated that today’s price cuts alone will save taxpayers at least another $1.5 billion over the next four years, providing ample scope for the PBS to fund new and innovative treatments as they become available.
“The Australian medicines industry needs predictability and stability in policy so that Australians can get the latest safe, effective and cost-effective treatments.
“There are many things about the health system that may keep health ministers awake at night, but the Pharmaceutical Benefits Scheme is not one of them,” Dr Shaw said.
Government expenditure on the PBS actually declined last financial year, in contrast to the rest of the health system, and industry experts predict it to fall again this year.
In the past few months, major reports from three separate government agencies have confirmed that PBS expenditure is contained and that price disclosure is delivering savings far in excess of what was expected.
“We know that the PBS reforms have secured an enduring savings mechanism through price disclosure. The industry has already done the hard yards and importantly, these reforms were achieved through collaboration between government and industry ” Dr Shaw said.
“But with the major price reductions enjoyed by government and patients, means there is a significant impact on industry, including job losses, restructuring and downsizing.
Today more than 120 medicines on the PBS will undergo a price cut, including medicines like docetaxel with a 90 per cent reduction, and simvastatin with a further 40 per cent price cut. These price cuts will save in excess of $1.5 billion over the next four years.
“That is many times over the expected cost of any new listings of medicines.”
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