The Government has released its response to the recommendations of the final report of the independent Pharmac Review panel, welcoming its insights as well as Pharmac’s commitment to improve in its role for better health equity and outcomes for all New Zealanders.

“We made an election promise to conduct an independent review to look at how well Pharmac performs against its objectives, and whether those objectives need changing,” Health Minister Andrew Little said.

“Securing the health of New Zealanders is a key priority for our Government. Ensuring Pharmac is working well as part of the total health system has been part of our plan.

“In Budget 22 we made the largest single contribution to Pharmac’s Medicines budget ever bringing total funding to $1.2 billion. This has already seen Pharmac launch consultations on proposals to fund medicines for conditions including cancer and multiple sclerosis.

“Our drug-buying system was set up nearly three decades ago and with the new health system ready to get to work come July 1, we knew it would be sensible to look at how well Pharmac is doing and ensure it is aligned with the principles of our health system rebuild.

“Pharmac’s purpose is to secure the best health outcomes that are reasonably achievable from pharmaceutical treatment from within the amount of funding provided.

“The panel found Pharmac’s model has delivered significant benefits, but to achieve its purpose these benefits need to be shared more equitably across our communities, especially for Māori and Pacific peoples,” Andrew Little said.

“As a result of this Review, Pharmac will have a much greater focus on improving the health of Māori, Pacific peoples, disabled people and other groups who do not yet share equitably in the benefits Pharmac provides.

“This will mean stronger relationships with Māori to honour te tiriti o Waitangi, that Pharmac is more inclusive of people with health needs, and explains its work more openly for the public.

“The Pae Ora Bill will put into action many aspects of the recommendations made by the Review Panel to be more collaborative, engaging and equity focused.

“Pharmac has confirmed to me that it accepts the Panel’s findings. Pharmac is committed to making the needed strategic and operational changes, and already has work underway to do this.

“The panel made 33 recommendations and the government agrees in principle with most of them. There is a small number of recommendations where the government takes a different view, for example where the health reforms will address the underlying issues now or in the future,” Andrew Little said.

“The main change is that Pharmac will be required to engage more with health consumer voices and to more actively collaborate and co-ordinate with other parts of the health administration.

“For example, developing a vaccine strategy is not just a matter of good procurement but needs to take account of a broader range of objectives which the Ministry of Health must be integrally involved with.”

Editors notes:

· The Government repsonse and the final independent Pharmac Review report are attached.

· The members of the independent panel were:

o Sue Chetwin (Chair), consumer rights advocate

o Sue Crengle, Professor of Hauora Māori, University of Otago in Dunedin

o Dr Tristram Ingham, Senior Research Fellow in medical epidemiology, Māori health and disability, University of Otago at Wellington

o Frank McLaughlin, past senior public servant and now Chapman Tripp consultant

o Heather Simpson, health economist who chaired the Health and Disability System Review

o Leanne Te Karu, pharmacist prescriber and community and primary care provider in high needs communities

The terms of reference required the review to consider:

· How well Pharmac performs against its current objectives and whether and how its performance against these could be improved.

· Whether Pharmac’s current objectives (with emphasis on equity for Māori and Pacific peoples) maximise its potential to improve health outcomes for all New Zealanders as part of the wider health system, and whether and how these should be changed.

· Out of scope matters included Pharmac's role making pharmaceutical decision on behalf of the government, funding, commercial-in-confidence and day-to-day operations.

· The review panel’s interim report released in December 2021 highlighted the need for greater attention to improving equity and greater transparency.

· The Pharmac Review website will be updated after 11.00am.

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