Government drug spending 'pathetic'

The funding of drugs by the Government in the last year has been descirbed as "pathetic" by the pharmaceutical industry and is likely to draw criticism from consumer groups.

The 2005 annual report of the Government's drug-buying agency, Pharmac, shows it underspent its budget for the year by $400,000 but the agency's chief executive Wayne McNee said nearly 7000 patients now had access to subsidised drugs as a result of funding decisions made during the year.

Nine new products had been added to the pharmaceutical schedule, and access had been widened for 16 previously subsidised products.

However, the Researched Medicines Industry Association (RMI) slammed the result, saying only one in every 600 New Zealanders actually benefited from Pharmac's "limited investment decisions".

The Government spent $564.6 million on drugs, within the budgeted $565 million, which was "an outstanding result", he said.

"The pharmaceutical budget is spread across all 21 DHBs and is not an easy target to hit, so to come within $400,000 is an excellent result."

However, RMI chair Pippa MacKay said much less than one per cent of the population - 0.16 per cent - had benefited from subsidised drugs, which was "a dreadful state of affairs".

"As a medical practitioner I know that there are far more people denied prescription medicines that are currently unfunded or which have restricted access," she said.

The Australian Government subsidised 300 new brands of drugs in the 18 months to May 2005, of which 38 were "new drug substances never listed before", Dr MacKay said.

Australia was investing an extra $50 per person over the next three years, while New Zealand had budgeted for only $11.85.

"This is pathetic, and will add to the ongoing tragedy of patients having to parade their illnesses in the public arena with a begging bowl," she said.

The Access to Medicines coalition (ATM), a lobby group set up last month, has accused Pharmac of too much focus on the immediate budgetary cost of medicinal drugs.

Spokesman Steve Attwood said the problem was not just the way Pharmac was required to operate under current budgetary restrictions, but also the lack of a national medicines policy.

Such a policy needed to include an "orphan drug" provision to ensure that people with rare, but severe, disorders did not miss out because their illness does not meet population-based criteria for subsidised treatment, he said.

However, Mr McNee said the 25 new spending decisions underlined Pharmac's focus on investing in medicines, which improve the health of New Zealanders.

"Our analysis shows that these decisions provided access to subsidised medicines for a further 6700 New Zealanders during the year."

New investments included treatments for raised cholesterol (ezetimibe), respiratory disease (tiotropium), HIV/AIDS (lopinavir with ritonavir), severe pain (fentanyl patches), and diabetes (pioglitazone, blood glucose test meters).

In addition to these new funding decisions, Pharmac widened access to treatments for patients who had heart failure (candesartan), breast cancer (letrozole), nausea from cancer treatments (hyoscine, ondansetron, tropisetron), hepatitis B and C (lamivudine, pegylated interferon), and mental illness (olanzapine and quetiapine for bipolar disease, citalopram for depression).

Mr McNee said the two largest investments for the year were the inclusion of tiotropium ($33 million over five years), and the widening of access to pegylated interferon for hepatitis C.
In the case of tiotropium, part of this funding will be offset by savings in other areas of healthcare, such as fewer hospitalisations, he said.

- NZPA