The price of certain prescription medicines will rise on 1 October 2022 and there appears to be some confusion surrounding the subject. After all Scott Morrison repeatedly promised that the maximum cost of prescription medicines would come down across the board by $10.
Now we find that all the while Morrison & Co had entered into an agreement which permanently raised the cost to non-concessional patients of what appears to be hundreds of generic medicines.
Indeed Morrison appears to have had the terms of a new strategic agreement with the pharmaceutical industry, the 5 year Medicines Supply Security Guarantee, done and dusted in early September 2021 so he was well aware during the April-May 2022 election campaign that he was not be entirely honest with voters.
The new Labor Government Minister for Health and Aged Care Mark Butler does not appear to have created a media release on the subject so far out from implementation of the price hikes and, given that these price hikes are one of the former Coalition Government’s political time bombs left behind to cause maximum pain, former Coalition health minister Greg Hunt is not around to give any sort of explanation as to why costs are going to go through the roof for many general patients.
It is also rather suspicious that it was the Murdoch media who ran with this story on the last working day of the week.
Journalist Sue Dunlevy ran with at least three different versions of the story on Friday, perhaps proving that confusion was not confined to the general public.
SUE DUNLEVY in the Townsville Bulletin, 15 July 2022, p.17:
The price of nearly 1600 prescription medicines is set to rise on October 1 under a deal struck with the generic medicines industry to overcome drug shortages.
The nation’s biggest selling scripts including cholesterol-lowering statins, antibiotics, antidepressants, reflux treatments and diabetes drugs will increase by up to several dollars a script.
Pensioners and concession card holders will not be affected, however, and will continue to pay the set charge of $6.80 a script.
However, the Department of Health and Ageing said “the price increases may result in an increase to the maximum general patient charge for medicines that receive a price increase”.
And they will also come at substantial cost to taxpayers, who will pay generic companies sometimes five times as much for medicines as is paid now.
The rises are the result of a strategic agreement struck between the previous federal government and the generic medicines industry to overcome shortages of medicines.
The deal affects the top 10 most commonly prescribed medicines on the Pharmaceutical Benefits Scheme (PBS). These medicines are off patent and the ex-manufacturer price is currently below $4 a pack.
SUE DUNLEVY in the Herald Sun, 15 July 2022, p.4:
EXCLUSIVE The price of almost 900 prescription medicines will rise on October 1 under a deal struck with the generic medicines industry to prevent shortages.
The nation’s biggest-selling scripts such as statins, antibiotics, antidepressants, reflux treatments and diabetes drugs will increase in price by up to several dollars a script.
The price hike affects all of the 10 most-prescribed medicines on the Pharmaceutical Benefits Scheme.
Some of the medicines, such as the heart drug candesartan, cost just 43 cents a pack. That drug’s ex-manufacturer price will rise to $2.50 – an increase to pharmacists of 480 per cent.
Pensioners and concession card holders are unaffected.
However, the Department of Health and Ageing warned: “The price increases may result in an increase to the maximum general patient charge.” They will also come at substantial cost to taxpayers who will be paying generic companies up to five times as much for medicines as is paid now.
It is a result of a deal struck between the former Morrison government and the generic medicines industry.
A spokesman for Health Minister Mark Butler said: “This was an arrangement nherited from the former government”.
Pricing of medicines under the PBS is highly complex. As well as the ex-manufacturer charge, pharmacists can apply dispensing, administration and handling fees of up to $18.40.
Discount chains such as Chemist Warehouse limit these extra fees and for many of these scripts charge just $5.99. Because they order large quantities they get discounts on the ex-manufacturer prices.
But under the new agreement, these discounts are set to end for drugs priced under $4 – a change that would make it harder for discount pharmacies to maintain their low prices.
Chemist Warehouse director Mario Tascone said the company was not planning price rises at this point.
“Permanently and artificially raising the wholesale price of prescription medicines (which will flow directly to the bottom line of drug companies P & L) seems like an odd thing to do in times where the cost of living is already rising out of control,” Mr Tascone said.
“Previous stock shortages were the result of a once-in-a-lifetime pandemic. Not sure a significant and permanent raising of prices is necessary.” The Department of Health said on its website global medicine shortages were disrupting supply of medicines. Requiring companies to hold up to six months’ supply in Australia would help overcome this.
It said the price rises would help manufacturers of low-cost medicine pay for improvements in the supply chain.
Labor promised to cut the price of prescription medicines by $12.50 a script from 2023 but this applies only to medicines that cost more than $42.50 and will not affect drugs caught up in this new price.
SUE DUNLEVY in The Mercury, 15 July 2022, p.21:
EXCLUSIVE The price of nearly 900 prescription medicines is set to rise on October 1 under a deal struck with the generic medicines industry to overcome drug shortages.
The nation’s biggest selling prescriptions, including cholesterol lowering statins, antibiotics, antidepressants, reflux treatments and diabetes drugs will increase in price by up to several dollars per script.
Pensioners and concession card holders will not be affected by the price rises and will continue to pay the set charge of $6.80 per script.
However, the Department of Health and Ageing has warned: the rise might result in an increase to the maximum general patient charge.
And they will also come at substantial cost to consumers who will be paying generic companies up to five times as much for medicines as they do now.
The price rises will further fuel inflation which the Reserve Bank forecasts will peak at 7 per cent in December.
The price rises are the result of a strategic agreement struck between the previous Morrison government and the generic medicines industry to overcome shortages of medicines.
The deal affects all of the top 10 most commonly prescribed medicines on the medicines subsidy scheme the Pharmaceutical Benefits Scheme (PBS).
These medicines are off patent and the ex-manufacturer price is currently below $4 per pack. Some of the medicines, like blood pressure treatment and heart failure drug candesartan, cost just 43 cents per pack. That drug’s ex-manufacturer price will rise to $2.50.
The nation’s biggest selling treatment, anti-cholesterol drug atorvastatin, which costs $2.95 will jump to $3.45. Rosuvastatin will rise from $1.70 to $2.50.
Anti anxiety treatment sertraline will go from $1.57 to $2.50, while asthma treatment salbutamol will rise from $2.61 to $3.11. “This was an arrangement inherited from the former government,” a spokesman for Health Minister Mark Butler said.
Most helpfully the federal Dept. of Health has an Excel file listing 1,597 prescription medicine pills, capsules, powders, granules, liquids, ointments, gels, creams, injections, suppositories etc., which are subject to the 1 October price increase - it can be downloaded from here and a two-page fact sheet is available here.
