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Dunne Speaks: A Better Way to Fund Medicines?

DUNNE SPEAKS

PHARMAC’s recent decision to fund two additional drugs from December this year has been widely welcomed by patients and the general public alike. The drugs, Kadcyla and Alecesana, are used in the treatment of advanced lung and breast cancers and will prolong and improve the quality of life of many affected patients who have been unable to afford them before now. Both drugs have been the subject of high profile campaigns from patients and their advocates who have long felt that the system has been too insensitive and slow to act upon their concerns. Against that backdrop, this recent PHARMAC decision was seen as something of a watershed.

The process by which PHARMAC decides which medicines to fund is rigorous and thorough, for obvious reasons, but consequently it is also very slow. Medicines recommended for funding by the Pharmacology and Therapeutics Advisory Committee (PTAC) can often wait months and in some cases years to be approved for funding by PHARMAC. PTAC is PHARMAC’s primary technical advisory committee and operates with an understandable sense of separation and independence.

Critics say that is a major part of the problem, and that a better model to follow would be that of Britain’s National Institute for Health and Care Excellence (NICE). They point out that once a drug has been recommended by NICE for funding it has to be funded immediately. As there is no equivalent to PHARMAC in Britain, it is the National Health Service (the NHS) that has to pick up the tab alongside all the other health expenditures for which it is responsible. As part of its decision-making process NICE does attempt to undertake some cost-benefit analysis and assessment of the cost–effectiveness of new treatments, but funding remains the responsibility of the NHS.

In New Zealand, where there has never been a very strong pharmaceutical industry, even in the best of times, mainly because of our small population size and distance from world markets, controlling the overall level of expenditure on pharmaceuticals has always been a major issue for governments. Until the late 1980s, there was no control; the prices demanded by manufacturers were paid unquestioningly, and the overall pharmaceutical bill was soaring. PHARMAC and its predecessor were established at that time to get some control of the level of pharmaceutical expenditure and the prices multinationals were charging New Zealand suppliers. It is fair to say that in the early years at least it went about its work with a vengeance and independence that successive Ministers of Health came to welcome, because PHARMAC, not the government, made all the difficult decisions, and took all the public opprobrium accordingly. PHARMAC was (and is still) effectively NICE and the NHS rolled into one. Ironically, one of the things other countries and their pharmaceutical agencies look admiringly at is PHARMAC and its independence.

Over the years, starting with the national medicines strategy, Medicines New Zealand introduced in 2007, there have been modifications to PHARMAC and its processes to make it more accountable to both patients and the pharmaceutical sector, although its autonomy remains its cornerstone. However, PHARMAC is still under no obligation to fund any medicine recommended by PTAC within a specific time frame, if at all. And governments generally choose not to intervene in the process.

While the Kadcyla and Alecesana decisions have been welcomed, they are by no means the only medicines in this situation. For example, Adalimumab was recommended for patients with ulcerative colitis in 2018, but is still awaiting a funding priority from PHARMAC. So too with Ustekinumab, another Crohns and Colitis drug, recommended by PTAC in early 2019 but still awaiting ranking by PHARMAC. And, as even a cursory glance at PHARMAC’s on-line application tracker shows, there are many other drugs in a similar limbo, affecting many other patients and conditions.

To deal with this, a government could decide to completely overturn the current system and revert to the previous system of just paying unquestioningly the prices multinational manufacturers demand for medicines clinically approved by PTAC. That would be as foolish as it would be short-sighted. So too would be the establishment of dedicated funds for new, innovative and expensive medicines, which the current government mooted but has now sensibly turned away from. Nor is it altogether desirable to be tacitly encouraging various high-profile and well-organised campaigns, however heart-rending and legitimate their cause, to be lobbying to be treated differently from everyone else. That just entrenches the unevenness and unfairness of existing policy.

What is needed is a much more fundamental consideration based upon sound epidemiological and clinical advice about the spread of medical conditions prevalent in New Zealand, both by age, gender and cultural groupings, and the range of medicines most likely to be needed in this country to deal with them. Then, armed with that information, which would almost certainly include all cancer and bowel related conditions, PHARMAC should be charged with developing a funding strategy to meet those requirements. In turn, the government would need to ensure that level of funding was made available and sustained into the future. The trade-off for any increase in spending on medicines would be the reduction in the need for more palliative services elsewhere.

Such a sharper and more strategic approach would ensure the focus was far more on providing people with the medicines they need, when they need them. It would be an incredible contrast to the current situation where pharmaceutical funding levels are incredibly ad hoc. The baseline has not been reviewed in years, and the increases that have taken place have been quite arbitrary, usually based on no more than what there is to spare in that year’s Health budget. There has been little evaluation of the efficacy of funding decisions to ensure the right people are getting access to the medicines they need and that those medicines have been effective. PHARMAC has been left to try to work incredible miracles, and then criticised when it sometimes fails to do so.

Without such a change of approach, the only resort available to desperate patients is more of the type of lobbying that preceded the Kadcyla and Alecesana decisions. It is demeaning, debilitating and unfair for people who are often extremely ill. And whatever else, it is no way to make sound clinical decisions about ensuring people get the medicines they need, when they need them.


Scoop Editor's note: this article has been amended as the original mistakenly referred to the drug Ibrance when it should have said Alecesana. ends

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