Medicines Australia Surprised By PBAC Measure

Main Category: Pharma Industry / Biotech Industry
Article Date: 15 May 2008 - 1:00 PDT

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Medicines Australia chief executive Ian Chalmers said tonight he was surprised and disappointed by the Government's controversial Budget measure forcing the pharmaceutical industry to fund the Government's own Pharmaceutical Benefits Advisory Committee.

While welcoming several health funding announcements in the Budget, Mr Chalmers said the Government's move to recover the cost of the PBAC was inappropriate. Mr Chalmers added that the imposition of cost recovery from 1 July 2008 gave pharmaceutical companies very little opportunity to make appropriate provisions in their annual budgets. Most Medicines Australia member companies operate calendar year budgets, with 2008 budgets already allocated.

"The implementation of cost recovery at such short notice will present a major challenge to companies," Mr Chalmers said.

"Cost recovery is not a measure that is appropriate. The procurement of pharmaceuticals for the PBS is a government function and it's unreasonable for industry to be expected to pay for the business of government."

Mr Chalmers said cost-recovery was particularly unwelcome at a time when the innovative pharmaceutical industry in Australia is confronting some specific challenges. "This measure comes on top of structural difficulties that the industry has had to deal with over the past few months," Mr Chalmers said.

"Industry has had three manufacturing plant closures announced in the past 12 months, at a cost of some 500 jobs. As well as this, our member companies face major price cuts from 1 August 2008 as a result of PBS reforms.

"Australia is in a fierce global competition at the moment and it's important for this country to have a policy environment that encourages investment by global head offices."

Medicines Australia