Appendix 2 | Summary of response to recommendations


Governance and accountability


Cancer medicines

Rare disorders 


Hospital medical devices

Promoting responsible use of pharmaceuticals  

Review Recommendation Government Response Pharmac role in responding to recommendation
Governance and accountability
1. Change the Pae Ora (Healthy Futures) Bill so that Pharmac’s best health outcomes objective includes securing equitable health outcomes for Māori and other populations. The Pae Ora (Healthy Futures) Act 2022 provides for all health entities (including Pharmac) working to achieve equity in health outcomes among New Zealand’s population groups, including by striving to eliminate health disparities, in particular for Māori.

Pharmac welcomes the passing of the Pae Ora (Healthy Futures) Act, and the establishment of Te Whatu Ora and Te Aka Whai Ora.

A more integrated system will support improved access to, and use of, medicines and devices. A strong collective focus on te Tiriti o Waitangi and health equity is also essential to delivering better and fairer health outcomes.

Please also see specific commitments 8, 10, 11, 25, and 30 in Appendix 1  

2. Make explicit the expectation that in seeking the best health and equity outcomes, Pharmac must work collaboratively with the Ministry [of Health], Health NZ and the Māori Health Authority.  The Pae Ora (Healthy Futures) Act 2022 requires all health entities (including Pharmac) to be guided by the health sector principles including in collaborating with agencies and organisations to address the wider determinants of health to protect and promote people’s health and wellbeing. The Government Policy Statement on Health the health strategies reinforce this requirement. Pharmac will give high priority to collective work with the te Manatū Hauora and other health entities to improve equity and health outcomes.
3. Ensure all health system guiding principles in the [Pae Ora (Health Futures)] Bill apply to Pharmac  The Pae Ora (Healthy Futures) Act 2022 sets out health sector principles that apply to all health entities, including Pharmac.

4. Amend Pharmac’s functions to:

a. transfer responsible use of medicines to Health NZ and Māori Health Authority

b. enhance its role as an advisory agency in security of supply for pharmaceuticals. 

a. Pharmac retains the responsible use of medicines function, not as a sole responsibility but in order to contribute to achieving its primary objective.

Collaborative work across agencies is underway to, for example, improve safety and quality in medicine use, to prevent development of antibiotic resistance and to improve accessibility of medicines for people who need them the most. This collaborative work will expand over time.

With regards responsible use of medicines, Pharmac considers a stronger focus on collective action is needed to make full use of the roles of multiple parties, including Pharmac.

Please also see specific commitments 23, 24, and 25 in Appendix 1

b. Te Manatū Hauora will lead health and disability sector input to supply chain resilience work across Government.

Pharmac has an important role in security of supply for pharmaceuticals. MFAT are leading supply chain resilience work (which includes health-related products), and Pharmac are connected with this work.

Please also see specific commitments 2 and 3 in Appendix 1.

5. Agree the membership of the Consumer Advisory Committee should be appointed by the Minister. The Pae Ora (Healthy Futures) Act 2022 requires health entity boards to have in place consumer advisory committees and to give effect to a code of expectations for consumer and whānau engagement in the health and disability sector. Pharmac will abide by this code and make consumer participation integral to its work. The code highlights opportunities to enhance consumer participation at all levels, including in Ministerial appointments to boards.

Pharmac acknowledges the need to strengthen consumer voices in its work, including through its consultation processes. This includes reaching out to priority populations, including Māori, Pacific peoples, and disabled communities.

We must embed the Health Quality and Safety Commission’s Code of Consumer and Whānau Engagement into our work.

Please also see specific commitments 27 and 28 in Appendix 1.

6. Direct the Ministry [of Health] to develop an updated medicines strategy in consultation with stakeholders (including Māori, Pasifika, disabled people) on its contents over the next 12 months Strategic thinking about how medicines contribute to equity and health outcomes will be progressed through the new suite of strategies required by the Pae Ora (Healthy Futures) Act 2022 and continued implementation of the current Medicines Strategy, including a new regulatory scheme for therapeutic products. Pharmac is very supportive of the strategies required under Pae Ora. Pharmac will continue to work collaboratively with Manatū Hauora and others as these important strategies advance.
7. Require Pharmac to ensure its contractual obligations do not preclude the sharing of commercially sensitive information with the key monitoring agencies such as Health NZ / Māori Health Authority, the Treasury. Pharmac will ensure its obligations to protect commercially sensitive information allow for levels of disclosure that are permissible in particular circumstances, with frameworks for permissions and processes for recipient handling of confidential information. 

Pharmac will review transparency and accessibility of information, while maintaining appropriate commercial sensitivity.

Please also see specific commitments 4, 5, 6, and 8 in Appendix 1.

8. Require Pharmac to improve the transparency and accessibility of its systems, processes, resources, and communications to allow disabled people to participate and contribute on an equal basis.

Pharmac will improve the transparency and accessibility of its systems, processes, resources, and communications to allow disabled people to participate and contribute on an equal basis.

Pharmac will ensure that the public and stakeholders are informed and engaged, that changes made as part of the Government response are visible and that the reasons for prioritising some changes over others are clearly explained.

Pharmac will strengthen its focus on better meeting the needs and interests of disabled people across its work.

Please also see specific commitments 4, 5, 6, 9, 20 and 26 in Appendix 1.

9. Direct Pharmac and other agencies in the health and disability sector to review how the different operating approaches used in the COVID-19 response could be applied to business-as-usual, including working collaboratively and speedily, sharing data, and using streamlined processes A health system response focused on health system supplies will be led by Manatū Hauora to contribute to wider Government work on supply chain resilience for essential supplies.

Pharmac has been an active part of the COVID-19 response and continues to take learning from this work.

Please also see specific commitments 2, 3, and 25 in Appendix 1.


10. Develop an integrated analytical framework for the assessment of pharmaceuticals that incorporates:

a. enhanced cost-benefit analysis with strengthened distributional elements

b. strengthened equity analysis in all its decision-making processes

c. reviewing and revising the Factors for Consideration to ensure a proper analytical framework for their application, which can be demonstrated to make a material impact on the outcomes of funding decisions and advance the agency’s equity goals

d. more formal structure to consider the prioritisation of the options for investment list currently performed by Pharmac staff, with greater input from its advisory committees

e. more generally, role clarity at each step of the decision-making process, including what information should be taken into account when preparing material to support decisions.

Pharmac will give high priority to considering equitable outcomes in its decision-making processes.

Pharmac will further develop its analytical frameworks and tools to include distributional analysis and support achieving more equitable outcomes. This will likely involve a multi-year programme of development, testing, and further refinement and be world-leading.

Pharmac will report on the impacts its work, including its collective work with other agencies, has on improving equity and health outcomes.

Pharmac has a strong focus on improving its assessment and decision-making processes.

Please also see specific commitments 1, 4, 5, 13, and 19 in Appendix 1.

11. Have stronger oversight by the board of the pharmaceutical investment decision-making, with a focus on what is not funded alongside what is funded. This should include:

a. ongoing quality assurance oversight of the investment decision-making process

b. regular evaluations of the impact of investment decisions and assurance that the pharmaceutical schedule more generally is advancing Pharmac’s objectives, including those of achieving equitable health outcomes.

  Pharmac recognises the expectations for effective governance of Pharmac and a continued focus on performance improvement.
Cancer medicines   
12. Agree that cancer pharmaceuticals should be considered like other pharmaceuticals. The emphasis needs to be on severity of disease, clinical alternatives, and cost for benefit.  Agreed with proviso that some unique characteristics will need to be considered.  

Pharmac has noted this recommendation, further noting that there have been various calls over time from stakeholder group for funding silos for particular treatments, which if implemented would be a significant change to the model.

Please also see specific commitments 1 and 29 in Appendix 1.

13. Notes the review considered ring-fenced funding for cancer but that would lead to prioritising over other conditions. Noted. 
14. Direct Pharmac and Te Aho o Te Kahu to develop a partnership to enable closer integration with the cancer health sector, with a focus on ensuring equitable access to funded cancer medicines. Agreed and noted already underway, Pharmac and Te Ahu o Te Kahu will continue their partnership. 

Pharmac works closely with Te Aho o Te Kahu and is progressing this partnership arrangement.

Please also see specific commitment 29 in Appendix 1

Rare disorders  

15. Ministry of Health to lead the development of a rare disorders strategy to coordinate efforts to address and improve the lives of people with rare disorders. This strategy will need to:

a. agree an official New Zealand definition of rare disorder

b. be a system view and based on a commitment to ensuring more equitable access to appropriate health care services from diagnosis through to treatment and other supports

c. consider the challenge of funding medicines for rare disorders, taking into account the increasing scale of the problem and the impact that this will have on health services more generally. 

The Government agrees that more can be done to improve the lives of people with rare disorders and to make it easier for people, practitioners, and organisations to get the information and support that would help. Manatū Hauora will lead development of a strategy that will lead to better, more timely services and more equitable support and outcomes for people and whānau with rare disorders.

Pharmac will support the development of a rare disorders strategy by Manatū Hauora.

Please also see specific commitment 30 in Appendix 1.

16. Fully adopt the recommendations of the Pharmac-commissioned RFP pilot evaluation:

a. Pharmac’s Rare Disorders Advisory Committee needs to meet frequently enough to undertake and/or consider horizon scanning.

b. Pharmac needs to demonstrate it is acting on the recommendation to have in place more regular calls to suppliers seeking applications.

Pharmac will continue to improve its responses to rare disorders, including continuing to involve the lived experience of rare disorders and other expertise.     

Pharmac will prioritise engagement with its Rare Disorders Specialist Advisory Committee (meeting as soon as practical) and proactively seek new funding applications from suppliers.

We will also clarify information published about our exceptional circumstances framework, including publishing better information about the outcomes from our exceptional circumstances decisions.

Please also see specific commitments 5, 6, 7, 27, 28, and 30 in Appendix 1.     

17. Support the chair of the Rare Disorders Advisory Committee to ensure the right expertise is invited to provide advice on applications where there is currently no member of the committee covering that specialism. This may mean involving experts from other countries.
18. Involve the lived experience of patients with rare disorders in the decision-making process. 
19. Extend the role of the Rare Disorders Advisory Committee to monitor and review pharmaceuticals once funded, to gauge their efficacy. This could be achieved through the development of a register for funded medicines.
20. Become more transparent about the decision on applications for rare disorders, including under exceptional circumstances.
21. Formalise the discretion currently applied within the exceptional circumstances process to minimise barriers to access for rare disorders, including greater clinical oversight.
 22. Transition the prioritisation of vaccines and their eligibility criteria to the newly established Interim Public Health Agency.

Not agreed – Achieving good immunisation outcomes across all of our communities is vitally important to New Zealanders’ health. Better gains will be achieved with the sector working together than in splitting up functions.

Te Manatū Hauora, Public Health Agency, and Pharmac will agree on a robust strategy for immunisation outcomes and the key vaccine decisions involved. Pharmac will use its purchasing skills to deliver the vaccines needed to protect New Zealanders, being responsive to needs of those involved in providing immunisation.

All entities will work together to achieve good and equitable immunisation outcomes in keeping with the high priority New Zealand has for preventing disease and improving health for all of our communities.    

Pharmac will work with other agencies through a new collective governance arrangement for the immunisation system. This will improve alignment of roles and responsibilities across the system.

Please also see specific commitments 1, 2, 8, and 25 in Appendix 1.  

23. Direct the Interim Public Health Agency to consider equity as part of the processes it adopts. 
24. Direct Pharmac to continue to negotiate the price, supply and terms and conditions of supply but not decide which vaccines are listed on the schedule or the eligibility criteria. 
 25. Transition these new arrangements over a sufficient time period to enable the Interim Public Health Agency to establish the requisite capability.
 26. Direct the Ministry of Health, the Interim Public Health Agency, Health NZ, and Pharmac to revise the memorandum of understanding to reflect clear roles and functions, including the primacy of the Interim Public Health Agency in ensuring the vaccine schedule is up to date and relevant to the health needs of New Zealanders.
 Hospital medical devices  
 29. Transfer cataloguing and contracting medical devices from Pharmac to Health NZ, which is better placed to manage procurement and supply chain for medical devices.

 Not agreed – The Government does not agree that Pharmac’s responsibility for pharmaceutical devices should be transferred to Health NZ at this stage, while Health NZ is being established. There is much to be done by the new entities without adding to that work, and a number of benefits to the public in Pharmac continuing to hold this responsibility.

Until new therapeutic products legislation is in effect, Pharmac’s safety and quality assessments are important across these products, and particularly for the increasing numbers of personalised and biologic devices. A number of devices are listed on the Pharmaceutical Schedule and funded for community use; it is probable that this will continue and expand in future.

The Government may review device procurement responsibilities in time. There are many different types of devices. While a full review will wait until the Therapeutic Products Bill is implemented and regulation for pharmaceutical devices is in place, responsibility for large devices involving significant capital outlay may be considered earlier. For now, the Minister of Health has asked Pharmac to continue to work closely with Health NZ as it works to promote consistency in health services across New Zealand.   

Pharmac will continue its responsibility to manage medical devices, in collaboration with Te Whatu Ora and other key agencies and stakeholders.

Please also see specific commitments 8, 10, 22, 26, and 28 Appendix 1.   

30. Direct that this transition happens at the speed Health NZ determines. 
31. Direct Pharmac to work with Health NZ to complete the design of the health technology assessment process
32. Direct Pharmac and Health NZ to report to the Minister on any ongoing role for Pharmac with medical devices.
Promoting responsible use of pharmaceuticals 
33. Agree Pharmac’s role in optimising the use of medicines should focus on ensuring medicines are assessed with an equity approach and undertaking any agreed activities that follow on from the proposed medicines strategy update and associated action plans. Pharmac will take an equity approach to pharmaceutical assessments and will promote responsible use of medicines. 

Pharmac has an important role in improving access to and use of medicines and medical devices. Alongside improvements in its own work, Pharmac supports more effective collective action with other agencies and stakeholders, given the important roles played by other parties. This includes a stronger collective focus on using data and insights to understand access and use across population groups, and to identify and prioritise initiatives to improve it.

Please also see specific commitments 8, 10, 19, 23, 24, and 28 in Appendix 1