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Medsafe, PHARMAC With Different Roles In Medicine

Medsafe, PHARMAC With Different Roles In Medicine Assessment

New Zealand has two agencies that assess medicines – Medsafe, the regulator, and PHARMAC, the funder. Both have separate and distinct roles and are independent of each other.

Medsafe is part of the Ministry of Health. Further information about Medsafe can be found at In general terms, however, all medicines must be approved by Medsafe before they can be sold in New Zealand. Medsafe applies internationally agreed standards of quality, safety and efficacy to data submitted by the manufacturer of a medicine before making a decision to approve or reject a medicine.

Medsafe utilises an independent advisory committee called the Medicines Assessment Advisory Committee, to advise it on applications to sell new medicines in New Zealand.

This committee evaluates data from clinical trials and testing programmes to determine the: Quality – is the manufacturing of the medicine of sufficient standard? Safety – is the medicine safe for patients and users? Efficacy – does the medicine or device work for patients with a specific medical condition?

All medicines approved by Medsafe are available for New Zealand patients. However, not all medicines are subsidised by the Government. Which ones are, and any criteria for access, is determined by PHARMAC.

In making its assessment, PHARMAC looks at both the clinical evidence of the drug and the cost of any benefits it might provide. A committee made up of clinicians with expertise in examining clinical evidence – the Pharmacology and Therapeutics Advisory Committee (PTAC) – makes recommendations to PHARMAC.

Both PHARMAC and Medsafe receive large volumes of information about new pharmaceuticals. This includes information from suppliers, literature sourced from medical journals, or other information.

In addition to PTAC’s clinical advice, PHARMAC does its own economic analysis of the product. This helps PHARMAC decide what priority for funding to give the medicine.

In essence, PHARMAC asks whether the drug in question is better than those that are already subsidised, in other words what its “relative efficacy” is. Often there are claims that a new drug is better than an older drug. PHARMAC uses the evidence to examine those claims closely to decide if new therapies really do offer an advantage over other ones.

PHARMAC uses nine decision criteria to decide what priority to give pharmaceuticals for new funding.

The health needs of all eligible people;

The particular health needs of Maori and Pacific peoples;

The availability and suitability of existing medicines, therapeutic medical devices and related products and related things;

The clinical benefits and risks of pharmaceuticals;

The cost-effectiveness of meeting health needs by funding pharmaceuticals rather than using other publicly funded health and disability support services;

The budgetary impact (in terms of the pharmaceutical budget and the Government’s overall health budget) of any changes to the Schedule;

The direct cost to health service users;

The Government’s priorities for health funding, as set out in any objectives notified by the Crown to PHARMAC, or in PHARMAC’s Funding Agreement, or elsewhere; and

Such other criteria as PHARMAC thinks fit. PHARMAC will carry out appropriate consultation when it intends to take any such “other criteria” into account.

New Zealand differs from other countries in having an agreed pharmaceutical budget, which in the 2006 financial year is set at $582.6 million. Any new spending has to fit within that budget, while still enabling all the drugs that are already funded to continue being available.

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