Preparations for COVID-19

OIA response

What has PHARMAC done to mitigate the risk of medical product supply chain disruption for New Zealand’s regular (non pandemic specific) medical product needs.

16 March 2020

[Name and contact details redacted]

Dear [Redacted]


Thank you for your email of 16 February 2020, requesting information under the Official Information Act 1982 (OIA).  You have asked for information about PHARMAC’s preparations in relation to a COVID-19 outbreak.

Your request has been considered under the OIA.

Each of your questions has been responded to in turn.  In some instances, the questions have been grouped in a single response.

What actions has PHARMAC taken, since January 15, not normally undertaken in the normal course of business, to mitigate the risk of medical product supply chain disruption for New Zealand’s regular (non pandemic specific) medical product needs. 

Most medicines sold and used in New Zealand have some or all of their manufacturing and production steps undertaken overseas, and PHARMAC recognises that due to the complex nature of the supply chain there will be disruptions to global supplies of some medications during a COVID-19 epidemic.  

PHARMAC is working closely with its contracted pharmaceutical suppliers at this time in relation to funded medicines.  We have intensified our communications to ensure that supply chain management and disruption of supply are actively communicated and managed.  We will continue to work with our suppliers, District Health Boards, prescribers and pharmacists to manage any shortages of funded pharmaceutical supply. As an example, PHARMAC has been working with the suppliers of funded paracetamol to manage global shortages while manufacturing plants in China are temporarily closed. PHARMAC has temporarily changed the dispensing rules for funded 500mg paracetamol tablets so that pharmacists can only dispense one month's funded supply at a time. This restriction is designed to ensure that paracetamol supplies are adequately managed in the coming months.  More information about the paracetamol restriction is available from 

More information about PHARMAC’s management of supply chain disruptions for pharmaceuticals is available at:

Information about pharmaceutical supply shortages is available on PHARMAC’s website at:

What medical product supplies (including medications) you have, at any time since January 1 2018, identified as ‘at risk’ to any degree with respect to disruption of supplies caused by a significant event, including but not limited to a pandemic. 

It is not possible to make generalisations about pharmaceuticals that are likely to be at risk of supply disruption during a significant global event.  Pharmaceuticals that might be in demand would vary according to the nature of the event and the health effects that arise from it. 

Further, a global medical emergency, such as the COVID-19 outbreak, has quite different supply repercussions than other types of events.  A local event is more likely to result in a localised disruption, which is generally of short-term duration.  A global event, such as COVID-19, is more likely to result in a more extensive, longer-term shortage of pharmaceuticals due to closures of manufacturing sites and other disruptions, especially for those pharmaceuticals that may be actively used in the clinical management of the virus.   

As indicated earlier, supplies of funded paracetamol have already been disrupted globally, and PHARMAC is needing to place restrictions on dispensing of it to actively manage New Zealand’s supplies.  More global supply shortages are likely as the disease becomes more widespread.  At this stage, it is not possible to know clearly what other pharmaceuticals are likely to be impacted. 

How many weeks/months/time units of supply New Zealand and/or DHBs generally hold and/or purchases at a time of those supplies that have been identified to be at risk. 

Pharmaceutical suppliers under PHARMAC contracts are required to keep a minimum stock in New Zealand equal to two months' demand. There is typically another four to six weeks’ worth of stock available across the wholesale and retail supply chain. Some medicines (for example some oral antibiotics) have a greater minimum stock holding requirement, such as four months. 

Since January 15, what senior/leadership/governance meetings have occurred in your agency solely related to preparations for a potential COVID-19 pandemic. 

PHARMAC has been meeting weekly with the Ministry of Health and Medsafe, as well as holding regular internal meetings to advance our individual organisation and collective preparations for a widespread COVID-19 outbreak in New Zealand.  

Since January 15, what activities not normally undertaken in your regular course of business, such as additional training and simulations, have been undertaken related to preparations for a potential COVID-19 pandemic. 

The Ministry of Health’s National Health Coordination Centre is leading New Zealand’s preparations and response to the COVID-19 outbreak.  A working group consisting of public health medicine specialists, Ministry teams and agencies within the public health sector has been established by the Ministry.  This group, which includes PHARMAC and Medsafe, meets weekly to share information and coordinate planning.  

The group is actively surveying the situation overseas and, through media communications and its website, PHARMAC conveys the best advice available about funded pharmaceuticals to New Zealanders. 

PHARMAC management is also currently reviewing its business continuity plan with a specific focus on COVID-19. 

What advice has PHARMAC received by medical experts, since 1 February 2020, with respect to additional demand that may be placed on certain medications, supplies and machinery, with consideration to the latest clinical information on COVID-19 published in reputable medical journals. 

As advised above, PHARMAC has been meeting weekly with the Ministry of Health and Medsafe to review the evolving situation overseas in preparation for a widespread COVID-19 outbreak in New Zealand.  

PHARMAC may undertake forecasting on the likely scenario in New Zealand, if COVID-19 cases escalate.  By that time it is likely that more robust scientific data would be available from overseas cases. 

Has your agency done detailed modelling to model the amount of medical product supplies that will be necessary to respond to certain levels of COVID-19 case numbers with consideration to the specific nature of the COVID-19 disease.  Has your agency done any modelling on what additional funding will be required to pay for additional medical products, machinery and related supplies, necessary to reduce a COVID-19 fatality rate, such as additional ventilation machines and related supplies. Supply the information. 

The Ministry’s National Health Coordination Centre is responsible for the all-of-government supply of required medicines and medical devices during a pandemic.  It has been forecasting patient numbers in the event of a surge scenario in hospitals and estimating the number of masks required by doctors during the outbreak. 

PHARMAC has been actively discussing pharmaceutical stock supplies and contingencies with its contracted suppliers of funded medicines. 

PHARMAC has not undertaken detailed cost forecasting for purchase of additional pharmaceutical supplies. 

Has PHARMAC contacted Gilead regarding obtaining access to the unproven medication remdesivir for compassionate use in COVID-19 cases. 

Has PHARMAC contacted Gilead and/or other manufacturers regarding other medications not proven to be safe or effective (eg chloroquine, kaletra) for compassionate use in COVID-19 cases. 

Is PHARMAC attempting to obtain supplies of any such medications?  If yes, how many doses or units? 

PHARMAC is working closely with the Ministry of Health and its external advisors, for a coordinated national response. 

PHARMAC has not had discussions with Gilead or other suppliers on access to medicines unproven in COVID-19.   Remdesivir, an investigational antiviral drug, is not approved for any indication globally. 

PHARMAC intends to be highly flexible and agile in its response to COVID-19 according to the disease scenario in New Zealand and the health needs of those patients most severely affected.  The NHCC has a Therapeutic Advisory Group (TAG) which will make recommendations for treatments and PHARMAC would follow their advice and pursue medicines if and when they are identified. 

Provide information you hold on the average/normal/expected costs per unit for each of the following items: P2/N95 masks, PPE goggles, PPE faceshields, PPE gowns, PPE Hazmat/coverall suits, and machines and related supplies for high-flow oxygen therapy, non-invasive and invasive ventilation, and extracorpeal membrane oxygenation (ECMO), and for other materials, machines and medicines that medical experts have advised will help to respond to a COVID-19 epidemic. 

Provide information you hold on the average/normal expected time for procurement for each of these ten items, from the date an order is placed to the time a product is delivered for use in a medical facility in New Zealand.

Provide information you hold on any emergency procurements related to these ten items already underway or being planned since January 1 2020.  Provide the number of units and average prices, since January 1 2020. 

PHARMAC does not hold information about PPE.  The National Health Coordination Centre is responsible for supply of PPE for New Zealand in a pandemic scenario.  I understand that the Ministry of Health has also received this OIA request from you and is expected to be responding directly to you in relation to this PPE matter.

Machines and related supplies for oxygenation and ventilation are purchased directly by District Health Boards, therefore PHARMAC does not hold this information.    

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
Policy Manager, Engagement and Implementation