Productivity Commission misses the point on the PBS

A new report released today by the Productivity Commission on ageing in Australia has missed the point about sustainability of the Pharmaceutical Benefits Scheme.

“It’s disappointing that today’s report by the Productivity Commission report shows the debate over PBS sustainability has not progressed much,” Medicines Australia Chief Executive, Dr Brendan Shaw, said today.

“Ten years ago we had the first Intergenerational Report singling out PBS cost projections as the villain without considering the benefits of new medical technologies to the community and the economy.

“Similarly, today’s report also focusses on cost projections of the PBS without much consideration of the benefits of spending on medicines.

“An example used in the report about medicines to treat blindness is a case in point. While the report discusses the cost of these treatments, it fails to discuss the social, economic and health system benefits of treating blindness in the Australian community.

“Moreover, while focussing on projections of the headline dollar cost of the PBS by the middle of this century, conspicuously the report does not project this as a share of GDP, nor does it discuss the contribution of the PBS to the projected growth in overall health spending vis-a-vis other parts of the health sector.

“It’s disappointing that the debate hasn’t moved on in ten years.

“It is unfortunate the PBS has been singled out for attention when, in fact, the industry has worked with governments to maintain the sustainability of the PBS.

“The fact is that government spending on medicines fell by 3.5 per cent last financial year, it’s falling as a share of GDP, and the projections are that it will remain stable as a share of GDP at least until the end of this decade.

“The key issue for the PBS going forward is not its financial sustainability but whether it can function effectively as a health program for the ageing population by delivering new medicines to patients in the future.”


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Alex Chapman
Phone: (02) 8281 3204