Hon David Seymour
Associate Minister of Health

Associate Education Minister David Seymour welcomes Pharmac’s decision to reduce the cost of some funded medicines to free up money for new medicines.

"For many New Zealanders, funding for pharmaceuticals is life or death, or the difference between a life of pain and suffering or living freely,” Mr Seymour says.

“The annual tender helps us manage how much New Zealand spends on medicines by reducing the cost of those we already fund. This frees up money to fund new medicines.

Annual tender changes allow Pharmac to free up between $30 million and $50 million annually.

“Each year, Pharmac invites suppliers to bid to be the main supplier of medicines that are no longer under patent,” Mr Seymour says.

“Medicine patents typically last for 20 years from the date of filing. Once a patent expires the doors are opened to generic competition. Other manufacturers can apply to produce and sell products containing the previously patented active ingredient. Generic market competition drives the price of medicines down significantly.

“Where practicable, and once relevant groups are consulted on, Pharmac might change from some original brand-name product to generic alternatives.

“My expectation is that Pharmac should have good processes to ensure that people with an illness, their carers and family, can provide input to decision-making processes. This is part of the ACT-National Coalition Agreement.

“People should have the opportunity to share what the impact of brand changes would be for them, and what support would be required if there was a change to their current medicine. I expect all key groups to be involved in changes to funded medicine brands through the annual tender.

“Pharmac received significant feedback at the end of last year about a decision to move to Estradiol TDP Mylan as the only funded brand of oestradiol patch. The community let Pharmac know that they weren’t consulted enough on the original decision.

“Pharmac has learnt from this. They added an additional consultation step to the annual tender process to seek feedback when considering a medicine brand change. This patient-centric approach was taken in today’s decisions.

“Pharmac asked for feedback from people who use the medicines in the list below, as well as from healthcare professionals and advocacy groups. The feedback has helped Pharmac shape its decisions.

“The decisions to add an additional consultation step on the annual tender process follows the appointment of Natalie McMurtry as the incoming Chief Executive, appointing a Consumer Working Group, publishing the Pharmac Consumer Engagement Workshop Report, and my letters of expectations, as positive steps towards a system which works for the people who rely on it.”

Note:

Information on the annual tender process can be found here: https://www.pharmac.govt.nz/news-and-resources/consultations-and-decisions/31-july-tender-notification

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