John Key admits New Zealand's drugs bill will rise

Prime Minister John Key has admitted that New Zealand will have to pay more for medicines if it signs up to the TPP. Photo / APN

Prime Minister John Key has admitted that New Zealand will have to pay more for medicines if it signs up to the Trans Pacific Partnership but he says this was unlikely to affect consumers.

Negotiations on the 12-nation agreement are now in their final stages, and ministers will travel to Hawaii this week to try and complete the deal.

Mr Key told reporters this morning that it was "highly probable" that drug patents would last longer under the Trans Pacific Partnership (TPP), and that meant Government would have to pay for the original drug - as opposed to the cheaper generic version - for longer.

"But for consumers that won't make any difference because on subsidised drugs you pay $5 for your prescription. So the Government may incur slightly more costs there."

He said the greater costs would be balanced out by the revenue from increased exports which would result from the deal.

The deal was a "two-way" street because New Zealand generated intellectual property as well, Mr Key said.

Labour Party leader Andrew Little said the higher costs for Government's bulk medicine-buying agency Pharmac would penalise taxpayers.

"A couple of weeks ago they were saying they would protect the rights of Pharmac. Now it looks like they're going back on that undertaking.

"If they now want to load up more costs on the New Zealand taxpayer to meet the costs of Pharmac, then that's unacceptable."

Anti-TPP campaigners took out full-page advertising in newspapers today to protest against the deal.

Mr Key said all of New Zealand's previous free trade agreements had attracted some protest.

"In the end, the question for New Zealanders is as simple as this - do you think if we have access to the massive United States and Japanese markets, with our exports having a level playing field, with they do better or worse, will it create more jobs or less, and will our country be more prosperous as a result? I think all the evidence shows that we will be."

Mr Little reiterated his party's position that it would not support a deal if stopped New Zealand from restricting foreign ownership of residential property.

He could not comment on whether a future Labour government would pull out of the TPP because the contents of the deal were not yet known.

He said Labour had a number of options if it entered Government, which included "fixing" the agreement or leaving it altogether.