Reference Pricing for Pharmaceuticals: Is the Australia - United States Free Trade Agreement Affecting Australia’s Pharmaceutical Benefits Scheme?

Medical Journal of Australia, Vol. 187, No. 4, pp. 240-242, 2007

3 Pages Posted: 11 May 2009 Last revised: 30 Jul 2014

Date Written: June 13, 2007

Abstract

Amendments to the National Health Act 1953 (Cwlth) were legislated by the Australian federal government in 2007 with minimal public debate. The National Health Amendment (Pharmaceutical Benefits Scheme) Act 2007 includes several changes that will limit reference pricing under the Australian Pharmaceutical Benefits Scheme (PBS). Here, I argue that these amendments were influenced by the Australia–United States Free Trade Agreement (AUSFTA) particularly the Medicines Working Group established under Annex 2C of that agreement. I make the case that such amendments could have adverse consequences, involving the erosion of scientific objectivity and equity in PBS processes.

One concern is that the amendments might lead to policy choice being delegated to technical experts in finance, or working groups with private interests, rather than being made part of a systematic public debate about the kind of health care system all Australians want to have, and the trade-offs they are prepared to make against strategic objectives of trade or international public policy.

Keywords: Reference pricing, Cost-effectiveness, Pharmaceutical regulation, AUSFTA, Free Trade Agreements, Trade Law

JEL Classification: I18, H41

Suggested Citation

Faunce, Thomas Alured, Reference Pricing for Pharmaceuticals: Is the Australia - United States Free Trade Agreement Affecting Australia’s Pharmaceutical Benefits Scheme? (June 13, 2007). Medical Journal of Australia, Vol. 187, No. 4, pp. 240-242, 2007 . Available at SSRN: https://ssrn.com/abstract=1402467

Thomas Alured Faunce (Contact Author)

Australian National University ( email )

Canberra, Australian Capital Territory 0200
Australia
61 2 61253563 (Phone)

Register to save articles to
your library

Register

Paper statistics

Downloads
125
Abstract Views
1,002
rank
224,850
PlumX Metrics