Decision to award sole supply of leflunomide

Leflunomide is a disease-modifying anti-rheumatic drug (DMARD) used to treat rheumatoid arthritis and psoriatic arthritis.

This decision was made following a Request for Tenders (RFT) for the supply of leflunomide issued on 3 June 2016 and a consultation letter dated 9 August 2016. The decision is as consulted on, excepting that a brand switch fee will be available to pharmacies.

In summary:

• the Apo-Leflunomide brand of leflunomide 10 mg and 20 mg tablets will be listed on the Pharmaceutical Schedule from 1 April 2017
• the subsidies for the Arava brand of leflunomide 10 mg and 20 mg tablets in the community will be reduced to the level of the subsidies for Apo-Leflunomide from 1 June 2017 and the Arava brand will be delisted from Section B of the Pharmaceutical Schedule from 1 September 2017
• Arava will be delisted from Part II of Section H of the Pharmaceutical Schedule from 1 June 2017
• Apo-Leflunomide will have Sole Subsidised Supply status in the community from 1 September 2017 until 30 June 2020 and will have Hospital Supply Status in DHB hospitals from 1 June 2017 until 30 June 2020, with a 1% DV limit.
• A brand switch fee will be available to be claimed on dispensing by pharmacies, once per patient, between 1 September 2017 and 30 November 2017, for Apo-Leflunomide 10 mg and 20 mg tablets.

Details of the decision

Apo-Leflunomide will be listed in Section B and Part II of Section H of the Pharmaceutical Schedule at the following prices and subsidies (ex manufacturer, excluding GST) from 1 April 2017:

The subsidies for the currently listed Arava brand of leflunomide will be reduced from 1 June 2017 via the application of reference pricing as follows:

If the supplier of Arava does not reduce the price of Arava to match the new subsidy, a manufacturer’s surcharge will apply to Arava from 1 June 2017 and patients will need to change to the Apo-Leflunomide brand in order to remain on a fully funded product.

Arava will be delisted from Section B of the Pharmaceutical Schedule from 1 September 2017 and will be delisted from Part II of Section H of the Pharmaceutical Schedule from 1 June 2017.

Apo-Leflunomide will have Sole Subsidised Supply status in the community from 1 September 2017 until 30 June 2020 and Hospital Supply Status in DHB hospitals from 1 June 2017 until 30 June 2020, with a 1% DV limit.

A Brand Switch Fee will be available to be claimed on dispensing by pharmacies, once per patient, between 1 September 2017 and 30 November 2017, for Apo-Leflunomide 10 mg and 20 mg tablets.

Implementation support

PHARMAC will provide patient information for use by healthcare professionals to help support patients with the change in brand.  Information will be able to be viewed and downloaded from the PHARMAC website.

Feedback received

We appreciate all of the feedback that we received and acknowledge the time people took to respond. All consultation responses received by 24 August 2016 were considered in their entirety in making a decision on the proposed changes. Responses were generally supportive of the proposal, and the following issues were raised in relation to specific aspects of the proposal:

More information

If you have any questions about this decision, you can email us at enquiry@pharmac.govt.nz or call our toll free number (9 am to 5 pm, Monday to Friday) on 0800 66 00 50.