Future safeguards when considering a brand switch to a generic medicine

OIA response

17 June 2021

Dear [name and contact details withheld] 


Thank you for your request dated 19 May 2021 under the Official Information Act 1982 (OIA) for information relating to changing brands of funded medicines. You requested: 

All documents, reports, written correspondence or other documentation assessing what, if any future safeguards Pharmac will put in place when considering a brand switch to a generic

All written correspondence to external parties, including MedSafe, Pharmacy Council NZ, Medical Council, and DHBs around any advice to put in place any future safeguards when considering a brand switch to a generic. 

Why we change brands of funded medicines

We operate on a fixed budget set by the government. Every year, our fixed budget pays for the medicines that are already funded. If there is money left over or we receive a budget increase, we use this to fund new medicines. There will always be more medicines we want to fund than we can afford. This means we have to make difficult choices about what medicines are funded. 

One way that we can free up money to invest in more new medicines is to change the brand of medicines that are already funded. Sometimes, this means changing to a generic medicine. 

Generic medicines are assessed by Medsafe and must be bioequivalent to the original brand medicine. This means generic medicines must have the same active ingredient, deliver the ingredient to the body in the same way, and have the same effect on the body as the original medicine. 

A recent example of a medicine brand change is a decision to change the funded brand of labetalol tablets. 

Improving how we engage with consumers about brand changes

Following a decision to change the funded brand of lamotrigine in 2019, we commissioned an independent review to consider whether our decision-making and implementation processes were appropriate.

The Independent Review of PHARMAC’s Lamotrigine Sole Supply Decision found that our process was evidence based, robust, and of a high standard. It made some recommendations for how we could improve our decision making and implementation processes for future similar brand changes.

Following findings noted in the independent review, we have been working to seek input from our Consumer Advisory Committee (CAC) early in our procurement processes. We are also working to update our website to ensure people can find important information more easily and making the information easier to understand. Additionally, we have recently consulted on updating the Terms of Reference of our CAC. This has included removing text that previously excluded the CAC from having a role in pharmaceutical funding decisions.

Following a recent communication from the Health and Disability Commissioner, the Ministry of Health will be leading work to clarify and agree the roles and responsibilities when communicating medicine brand changes. We look forward to working with the Ministry of Health and other health sector partners on this.

Changes to our approach to contracting

In October 2020, we announced our decision to adopt a Principal Supply Status funding approach. This change in approach to funded supply of many medicines will move away from sole supply status. Under Principal Supply, the principal supplier’s brand will be the main funded brand but there will be an allowance for other brands to be funded in certain circumstances. This will mean that PHARMAC will have greater flexibility to respond to the needs of specific groups of patients or individuals who may experience, or are at heightened risk of experiencing, challenges with a brand change.

Documents related to your request for information

We have noted the findings and recommendations of the independent review, recommendations from the Health and Disability Commissioner to the Director-General of Health, and the Coroner’s findings and recommendations relating to the lamotrigine brand change.

Copies of these reports can be found online:

  1. Claro Law, Independent Review of PHARMAC’s Lamotrigine Sole Supply Decision
  2. Health and Disability Commissioner’s letter to, and response from, the Director-General of Health(external link)
  3. Findings of Judge D Marshall, Epilepsy Joint Inquiry: Medication brand switch(external link)

Please note, we need additional time to consult about the release of the documents related to your request. As required by the OIA, we are giving notice that we need to extend the decision time limit for responding to your request, as allowed under section 15A(1)(b) of the OIA. We have extended the time limit by a further 20 business days, to 15 July 2021.

Please note you have the right, by way of complaint under section 28(3) of the OIA to an Ombudsman, to seek an investigation and review of our decision.

We trust that this information answers your queries. We are making our information more freely available, so we 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