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Securing medicine supply and investing in COVID-19 capacity

Hon Chris Hipkins
Minister of Health

• $150 million (over two years) for PHARMAC to secure the ongoing supply of medicines and medical devices in the face of global supply challenges
• Further investment ($30 million) in the National Close Contact Service and the technology that underpins its work
• Full funding for the development of the National Immunisation Solution so it is ready for when a COVID-19 vaccine is available
• $35 million to purchase and install equipment to supply oxygen to patients (to support the use of more ventilators and respiratory equipment)
• An additional $50 million for PPE supplies

The Government has moved to ensure New Zealanders continue to get access to the medicines they need, while at the same time investing more in contact tracing and other COVID-19 health responses.

“The world is going to be living with the ongoing impacts of the COVID-19 global pandemic for some time. It’s important we continue to invest in our health services and build our capacity to respond to the virus,” Health Minister Chris Hipkins said.

“This Government has significantly boosted funding for PHARMAC to purchase medicines. In the last year alone we have announced an extra $220 million investment, as well as a one-off boost of $35 million in response to COVID-19.

“However, the cost of medicines has increased due to supply issues caused by the global pandemic.

“For example, to prepare for a potential COVID-19 related increase in treatment of patients in ICU, PHARMAC secured additional stock of several medicines including propofol, fentanyl and noradrenaline. Securing these medicines cost approximately 70% more than would have been expected prior to the pandemic.

“With the virus now spreading faster than ever it’s clear that disruption to supply chains will continue and more investment is needed.

“That’s why the Government has approved $74 million more for PHARMAC this year, and $76 million in 2021/22, out of the Covid Response and Recovery Fund.

“This will mean PHARMAC can continue to purchase the medicines and medical devices New Zealanders need,” Chris Hipkins said.

Further health funding has also been approved to strengthen New Zealand’s capacity to respond to the ongoing threat from COVID-19, including through contact tracing, technology to support the roll-out of a future vaccine and more money to reflect the ongoing increase in demand for telehealth services.

“New Zealanders have done incredibly well to eliminate community spread of COVID-19 and we have some of the toughest border protections in the world to keep the virus at bay. But we can’t take anything for granted.

“We are constantly reviewing our response and improving our systems and processes.

“As part of that, we’re investing a further $30 million in the National Close Contact Service, including for surge capacity and information technology. It also supports the ongoing development of the COVID Tracer app.

“Contact tracing is one of the key pillars of our defence against COVID-19 and other infectious diseases. This investment will further strengthen our contact tracing capability at a national level.

“A further $23 million will be used to develop a National Immunisation Solution, so that when a COVID-19 vaccine is developed we are ready to roll out a mass vaccination programme. This builds on an earlier investment of $15 million.

“We can’t afford to wait for a vaccine to be available – we need to start work now to replace the current National Immunisation Register, which simply could not cope with the scale and complexity of a mass COVID-19 vaccination campaign.

“We’re also investing in more in our hospitals’ infrastructure to support the use of ventilators in the event of an outbreak. $35 million will be used to purchase more oxygen supplies and the necessary gear to ensure it is delivered at the right pressure.

“All these investments are designed to further build our ability to respond to the global pandemic now and into the future. New Zealand’s health response to COVID-19 has been world leading – we intend to keep it that way,” Chris Hipkins said.


NOTE: In total investments worth $302.6 million have been announced today:
• $150 million for medicines and medical devices through PHARMAC
• $50 million for PPE
• $35 million for oxygen supply ($25 million of which is capital, with $10 million operational funding)
• $30 million for the National Close Contact Service
• $14.6 million for telehealth services
• $23 million to develop the National Immunisation Solution ($14 million of operational funding and $9 million capital)

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