$2 billion in PBS price cuts
May 5, 2010
AN AGREEMENT between the
government and Medicines
Australia is set to see $2 billion in
new savings on the PBS announced
in next week’s Federal Budget.
The move, revealed in today’s
Financial Review, will reportedly
extend mandatory price disclosure
as more drugs come off patent -
but will also see the government
undertake not to introduce any new
therapeutic groups.
Health minister Nicola Roxon is
set to announce the changes next
week, with manufacturers agreeing
to concessions in return for industry
certainty in the coming years.
The $2 billion in price cuts will be
effective over the next four years,
and the AFR also said that if the
industry doesn’t deliver the savings
there will be a mechanism to “claw
back the targeted subsidies direct
from industry coffers”.
Guild President Kos Sclavos, who
earlier this week unveiled the details
of the Fifth Community Pharmacy
Agreement (PD yesterday), said he
wasn’t able to comment on budget
sensitive issues due to the
confidentiality of the Guild-
Government negotiations.
However during a briefing on the
5CPA with media on Mon
afternoon it was clear that the talks
did include all flow-on impacts to
community pharmacy, with the
agreement incorporating a “whole
of pharmacy approach”.
Sclavos said on Mon that “the
signed agreement has many
contingencies contained in it and
because of budget sensitive items
the full agreement documentation
cannot be publicly released.
“The savings envelope offered to
Government had not changed from
24 December 2010 when the $1
billion savings amount was
announced,” he added.
Despite claims in today’s
Financial Review story that this new
round of $2 billion price cuts will
upset the Guild, it appears that
flow-on impacts to pharmacy will
have in fact been already dealt with
in the Fifth Agreement.
The fine details and how they will
affect pharmacy are expected to be
revealed next Tuesday night when
the federal Budget is released.
MEANWHILE the Pharmacy
Guild has embarked on a national
round of Member Meetings to brief
pharmacists on the agreement,
with the first event held in Perth last
night and attended by 150
pharmacists - see tomorrow’s PD
for more details.
The next briefing will be held on
Monday night in Canberra.
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