27 April 2021: OIA response | Medicines on PHARMAC’s ranking list

27 April 2021

Dear [name and contact details withheld]

REQUEST FOR INFORMATION

Thank you for your request dated 25 March 2021 under the Official Information Act 1982 (OIA) for information relating to medicines analysed and assessed for funding by PHARMAC.

You requested:

  1. The number of medicines that are currently on PHARMAC's ranked/prioritised waiting list in 2021. For clarity - this is the list of medicines that have been analysed and assessed by PHARMAC staff and management. 
  2. The estimated total level of money (NZ$) required to completely fund the medicines currently on the PHARMAC ranked/prioritised waiting list. 
  3. How many medicines were on PHARMAC's ranked/prioritised waiting list for each year as at 31 December over the past 11 years from 31 December 2010 through to 31 December 2020? 
  4. Currently, how many of the medicines have been on the PHARMAC ranked/prioritised waiting list for more than 2 years. 
  5. Currently, how many of the medicines have been on the PHARMAC ranked/prioritised waiting list for more than 4 years.   
  6. Currently, how many of the medicines have been on the PHARMAC ranked/prioritised waiting list for more than 6 years.

We have provided information within this letter in response to your request. Please note:

  • Table 1 contains information in response to requests 1 and 3.
  • Table 2 contains information in response to request 2.
  • Table 3 contains information in response to requests 4 to 6.

Background information: PHARMAC’s funding application assessment and decision-making process

PHARMAC’s job is to decide what medicines and therapeutic products to fund for the best health outcomes for New Zealanders, while staying within the fixed Combined Pharmaceutical Budget (CPB).

Generally, a funding application must be submitted to PHARMAC for a medicine or therapeutic product to be considered for public funding. After a funding application has been received, PHARMAC seeks independent clinical advice on a proposal[1] from the Pharmacology and Therapeutic Advisory Committee (PTAC) and/or a Subcommittee of PTAC.

We assess all funding applications (individual proposals) using our Factors for Consideration to ensure that every application is treated fairly. Every medicine or therapeutic product that is recommended for funding by our advisors is compared and ranked against all other funding options, and no one therapy area is given priority over others.

Refer to the PHARMAC website to read about the medicines funding process.

PHARMAC ranks proposals to several different lists, which support our assessment and funding decision-making process. These include:

  • Options for investment (OFI) – proposals, in rank order, that we have determined should be funded (if sufficient funding is available within our fixed budget).
  • Only if cost neutral or cost saving – proposals that we would fund if they cost the same as, or less than, other medicines or therapeutic products we already fund. Generally, these are medicines or therapeutic products that our clinical advisors consider would not deliver better health outcomes than another medicine, therapeutic product or service (ie surgery) that is already publicly available.
  • Recommended for decline – these are proposals that our clinical advisors have recommended be declined. Once placed on this list, they are not actively worked on and are likely to (eventually) be taken forward to a decision to decline (unless new information is submitted, in which case further assessment is undertaken).
  • Under assessment – proposals where clinical advice is being sought or that are awaiting health economic evaluation, prior to being placed on one of the above three lists.

Proposals and medicines/therapeutic products on PHARMAC’s OFI list

We have interpreted your request as relating to proposals listed on our OFI list. 

Because we receive different proposals for the same medicine or therapeutic products (that is, we have proposals for the same medicine to treat different indications), we have provided both the number of proposals and separately the number of medicines/therapeutic products.

We note that, initially, PHARMAC was established to manage the list of (and funding for) pharmaceuticals used in the community (ie those most often dispensed via retail pharmacies).  PHARMAC’s scope has expanded over time, meaning that we are responsible for making decisions about, and managing the funding for, a wider range of medicines and therapeutic products. This information is provided for context in Table 1.

Table 1: Number of proposals and medicines/therapeutic products on PHARMAC’s OFI list

Calendar year

Number of proposals

Number of medicines/ therapeutic products

Expansions to PHARMAC’s scope

2010

48

40

 

2011

34

31

Hospital cancer medicines

2012

39

34

Vaccines

2013

38

35

All hospital medicines and certain haemophilia treatments

2014

27

26

 

2015

49

41

 

2016

59

50

 

2017

63

56

 

2018

74

55

 

2019

100

73

 

2020

121

75

 

2021

118

73

 

Note:

  • With the exception of the 2021 figures, the number of proposals and medicines/therapeutic products is sourced from the OFI list following our internal prioritisation meeting in the last week of November or first week of December in each year.
  • The 2021 figures are sourced from the most recent internal prioritisation meeting held on 2 March 2021.
  • PHARMAC’s OFI list is dynamic, with items being:
    • removed throughout the year, as funding decisions are made (thus new items are added to the Pharmaceutical Schedule);
    • added throughout the year, as our assessment process is completed for new funding applications and they are ranked;
    • moved within the list, as their relative ranking changes due to updated clinical or commercial information.

Table 2: Five-year CPB impact of funding all proposals on PHARMAC’s OFI list

2021/22

2022/23

2023/24

2024/25

2025/26

NPV[2]

$417,670,000

$410,260,000

$460,400,000

$490,970,000

$503,670,000

$1,952,200,000

Note:

  • Figures are calculated assuming all proposals are funded from the start of the 2021/22 financial year[3].
  • NPV is calculated over 5 years using an annual discount rate of 8%
  • Figures do not include other DHB costs (such as pharmacy dispensing fees, infusion costs etc).
  • Figures assume all medicines or therapeutic products are used by all eligible people; however, this may not reflect the actual budget impact as some items on the OFI list are used to treat the same indication as other items on the OFI list. This could mean if one item from the OFI list is funded, other items on the OFI list for the same indication may be used by a smaller number of people or may not be used at all. 

Table 3: Duration proposals have been on PHARMAC’s March 2021 OFI list

Years on OFI list

Number of proposals

0 to <2 years

16

2 to <4 years

63

4 to <6 years

25

6+ years

14

Total

118

We trust that this information answers your queries. We are making our information more freely available, so we will now publish selected OIA responses (excluding personal details) on our website. Please get in touch with us if you have any questions about this.

Yours sincerely

Rachel Read
Manager, Policy and Government Services

 

[1] A proposal refers to a funding application for one medicine and one indication. For example, adalimumab for the treatment of undifferentiated spondyloarthritis is a separate proposal to adalimumab for the treatment of ulcerative colitis. Additionally, adalimumab for the treatment of ulcerative colitis is a separate proposal to vedolizumab for the treatment of ulcerative colitis. 

Duplicate funding applications from multiple applicants (ie the same medicine and indication) are combined into a single proposal.

[2] Net present value

[3] PHARMAC’s financial year runs from 1 July to 30 June.