Communications and documents about proposal to amend Schedule Rules for Class B controlled drugs

Thank you for your request dated 13 February 2023 under the Official Information Act 1982 (OIA) for information relating to the proposal to amend the Pharmaceutical Schedule (“Schedule”) Rules on prescribing and dispensing of Class B controlled drugs. In my letter to you of 13 March 2023, I extended the due date for our response to 12 April 2023.

In response to your request for information, I have provided contextual information within this letter to address the concerns you raised. I have also included details about our decision to release documents related to your request. 

For ease of reference, I have numbered each point of your request as copied below. You requested: 

Consultation process

Can you… please provide: 

1. All consultation feedback received by Pharmac to the proposal
2. All documentation and messages regarding the assessment and consideration of the feedback by Pharmac, particularly the criteria used to assess any changes to the proposal
3. All documentation about how Pharmac conducts consultation processes, and all documentation about how it was followed in this case
4. All documents and messages between Pharmac and MoH regarding the amendments to the Pharmaceutical Schedule Rules on prescribing and dispensing of Class B controlled drugs, irrespective of whether they formed part of the consultation process or not. 
   
   Impact on the ADHD community
5. All cost/benefit assessments conducted into the impact of the delays to the Rules
6. All information about how the benefits to communities from changes to the Rules are balanced against the regulatory factors cited by MoH in their request for delay. 
   
   Frustration of the intent of Parliament
7. All documents showing the legislative authority of Pharmac to further consult on the Rules despite the consultation on the Regulations being completed and the Regulations made
8. All documents describing the justification or rationale for consulting on the changes to the Rules, despite the process hurdles this would create. 
   
   Further, in the consultation material it was claimed by Pharmac that the changes could not be put in place any sooner than February 2023 because of necessary “system and process changes”. Can you therefore please provide: 
9. All documents describing the system and process changes
10. All planning and project management documents showing the timelines for their implementation
11. All documents showing why the system and process changes had not been completed in a timely fashion so that the necessary changes were available when the Regulations took effect. 

Funding pharmaceuticals in New Zealand

Pharmac is the government agency that determines which medicines and related products are funded in Aotearoa New Zealand. This includes setting access criteria and rules that might apply to that funding. All of the funded medicines are listed in the Pharmaceutical Schedule (the Schedule). 

The legislation governing Pharmac and its operations is the Pae Ora (Healthy Futures) Act 2022 (the Pae Ora Act) sections 68 – 74[1]. Particular sections of the Pae Ora Act relevant to your OIA request include (italics added): 

68 Objectives of Pharmac

(1) The objectives of Pharmac are—

(a) to secure for eligible people in need of pharmaceuticals, the best health outcomes that are reasonably achievable from pharmaceutical treatment and from within the amount of funding provided; and

(b) any other objectives it is given by or under any enactment, or authorised to perform by the Minister by written notice to the board of Pharmac after consultation with it.

(2) In this section, eligible people means people belonging to a class specified in regulations made under section 102(external link) as being eligible to receive services funded under this Act. 

69 Functions of Pharmac

(1) The functions of Pharmac are—

(a) to maintain and manage a pharmaceutical schedule that applies consistently throughout New Zealand, including determining eligibility and criteria for the provision of subsidies; and

(b) to manage incidental matters arising out of paragraph (a), including in exceptional circumstances providing for subsidies for the supply of pharmaceuticals not on the pharmaceutical schedule; and

(c) to engage as it sees fit, but within its operational budget, in research to meet the objectives set out in section 68(1)(a)(external link); and

(d) to promote the responsible use of pharmaceuticals; and

(e) to perform any other functions it is for the time being given under any enactment, or authorised to perform by the Minister by written notice to the board of Pharmac after consultation with it.

(2) Pharmac must perform its functions within the amount of funding provided to it and in accordance with its statement of intent (including the statement of forecast service performance) and (subject to section 66(external link)) any directions given under the Crown Entities Act 2004(external link). 

As a Crown agent, Pharmac operates independently of the Government, including the Minister and Manatū Hauora (the Ministry of Health), but works within the regulatory and government policy frameworks in New Zealand; including the Medicines Act 1981, the Misuse of Drugs Act 1975, and the respective Regulations. Changes made by the Government to laws and regulations do not automatically change the Schedule. 

The Schedule Rules contain the restrictions and other general rules that must be observed in order for a subsidy to apply to a pharmaceutical dispensed in the community setting or to enable a Te Whatu Ora Hospital to use a pharmaceutical on an inpatient. The Rules are established and function separately from the Government’s laws and regulations because section 68(1) of the Pae Ora Act requires Pharmac make pharmaceutical funding choices within a fixed budget – meaning that it does not need to enable funding for every medicine or prescription in New Zealand.

These rules only relate to eligibility for Subsidy for Community Pharmaceuticals and the circumstances in which a Hospital Pharmaceutical may be Given. Users of these rules should be aware that there are other requirements relating to the prescribing, dispensing, and Giving, of Pharmaceuticals including legislative and regulatory requirements, as well as contractual obligations.[2] 

Consultation and decision making

Pharmac uses an assessment and decision-making framework we call the Factors for Consideration(external link) and our the Operating Policies and Procedures(external link)[3] to guide the way we make decisions while acting within our obligations under the Pae Ora Act. This includes a statutory obligation to consult(external link) on matters relating to changes to the Pharmaceutical Schedule. 

70 Pharmac to consult in implementing objectives and performing functions

In performing its functions, Pharmac must, when it considers it appropriate to do so,—

(a) consult on matters that relate to the management of pharmaceutical expenditure with any sections of the public, groups, or individuals that, in the view of Pharmac, may be affected by decisions on those matters; and

(b) take measures to inform the public, groups, and individuals of Pharmac’s decisions concerning the pharmaceutical schedule. 

Regulating “controlled drugs” in New Zealand

Manatū Hauora is responsible for regulating medicines; i.e. Manatū Hauora is responsible for administering the Misuse of Drugs Act 1975(external link) (“the Act”) and the Misuse of Drugs Regulations 1977(external link) (“Regulations”).

In relation to the recent changes to the Misuse of Drugs Regulations 1977(external link), Manatū Hauora advised Pharmac in mid-2022 that changes were being considered but had not yet been confirmed. Pharmac indicated to the Ministry of Health that it would intend to update the Schedule Rules to allow longer prescriptions for Class B Controlled Drugs to be subsidised after the Regulation changes were confirmed. 

The final changes to the Regulations were publicly notified by Gazette on 24 November, to come into effect on 22 December. Pharmac issued its consultation on proposed changes to the Schedule Rules on 25 November 2022. 

Proposal to amend the Pharmaceutical Schedule Rules on prescribing and dispensing of Class B controlled drugs

Pharmac was unable to consult about the proposed changes to the Schedule until the legislative changes were confirmed. Pharmac issued consultation on changes to the Schedule Rules on 25 November 2022. In order to give adequate time for consultation, and reflecting the lead-times necessary for both Pharmac and the sector to make and implement changes to the Schedule, the Schedule changes were proposed to take effect from 1 February 2023. The initial consultation period for this proposal was to close on 9 December 2022, however consultation was subsequently extended to 21 December. 

In the first week of receiving consultation feedback, it became clear that our consultation had made a much wider group of stakeholders aware of the changes that had been made to the Misuse of Drugs Regulations. Feedback provided to Pharmac, as well as directly to the Manatū Hauora and the Minister of Health, suggested that the changes to the Regulations may not have been made with a full understanding of stakeholders’ views. This new information prompted Manatū Hauora to decide to relook at the regulatory changes that had been made and, in response to a request from Manatū Hauora, Pharmac agreed to delay making a decision on our proposed changes to the Schedule Rules while the Ministry reviewed the amendments that had been made to the Regulations. 

Documents related to your request

Consultation feedback released under the OIA

On 22 February 2023, we provided you access to a downloadable copy of all consultation feedback received by Pharmac relating to the proposal to amend the Pharmaceutical Schedule Rules on prescribing and dispensing of Class B controlled drugs. We trust that the document provided has addressed the first point of your request. 

Additional documents for release in response to your request

We have identified documents related to questions 2, 3, 4, 8, 9, 10, and 11 of your request and have decided to release these documents to you. However, we need a little more time to finalise these documents for release. We expect to have them with you by the end of Friday 14 April 2023 and we will provide these documents to you without undue delay. 

We have prepared two PDFs of combined documents for release in response to your request for information, described below: 

1. ‘OIA documents for release - Q2, Q3, Q8, Q9, Q10, Q11’, and
2. ‘OIA documents for release - Q4’. 

In deciding to release these documents to you, we have redacted a small amount of information where it is not related to your request (i.e., out of scope) or where we consider this is necessary to:

• protect the privacy of natural persons (section 9(2)(a));
• protect information where the making available of the information would be likely to unreasonably prejudice the commercial position of the person who supplied or who is the subject of the information (section 9(2)(b)(ii));
• protect information which is subject to an obligation of confidence or which any person has been or could be compelled to provide under the authority of any enactment, where the making available of the information would be likely to prejudice the supply of similar information, or information from the same source, and it is in the public interest that such information should continue to be supplied (section 9(2)(ba)(i));
• maintain the effective conduct of public affairs through the free and frank expression of opinions by or between officers and employees of an organisation in the course of their duty (section 9(2)(g)(i); or
• enable us to carry on, without prejudice or disadvantage, negotiations, including commercial negotiations (section 9(2)(j)).

Additionally, some documents set to be released are draft documents. As draft documents are considered official information under the OIA, these are indicated with a “DRAFT” watermark on applicable pages of the PDFs. 

Some information requested is not held or does not exist

Some of the information and/or documents you have requested are not held by Pharmac (section 18(g) of the OIA) or do not yet exist (section 18(e) of the OIA). Portions of your request where no relevant documents or information is held or exists are listed below. 

5. All cost/benefit assessments conducted into the impact of the delays to the Rules

6. All information about how the benefits to communities from changes to the Rules are balanced against the regulatory factors cited by MoH in their request for delay. 

Closing

We trust that the above information assists with your queries. We will be in contact again soon with the additional documents for release described in this letter. 

Please note, you have the right to make a complaint to the Ombudsman about our response to your OIA, under section 28(3) of the OIA. Details of how to make a complaint(external link) are on the Ombudsman’s website. 

To make information more freely available, we publish selected OIA responses (excluding personal details) on our website. Please get in touch with us if you have any questions about this.

Footnotes

[1]Pae Ora (Health Futures) Act 2022(external link)(external link)

[2] Rules of the Schedule 

[3] Operating Policies and Procedures of Pharmac (The Pharmaceutical Management Agency), Fourth Edition 27 January 2017