Pharmac v Rachel Smalley: Drug agency’s board backs chief executive Sarah Fitt after her apology

Pharmac chief executive Sarah Fitt. Photo / Jason Oxenham

Pharmac’s board has accepted an apology and “verbal explanation” by chief executive Sarah Fitt, following her involvement in internal emails about broadcaster Rachel Smalley.

Board chair Steve Maharey said the board had endorsed an “action plan” proposed by Fitt and other leaders to improve the organisation’s culture, including by hiring “an external party to assist the senior leadership team and the board”.

“The chief executive expressed her regret over the comments. The board has accepted her apology and verbal explanation. It has requested that the chief executive offer a public apology,” Maharey said.

Smalley told the Herald she was appalled by the response, which “calls into serious question the capability and competency of Pharmac’s board”.

“Is this the best Steve Maharey can do? His solution is to agree to spend more taxpayer dollars commissioning an external agency to teach Pharmac how to be nice?”

Smalley questioned how Public Service Commissioner Peter Hughes could be satisfied with the response outlined today, and said she felt most sorry for those reliant on the agency for medicine and medical devices.

“This tells them nothing will change at Pharmac except they’ll be commissioning external consultants to improve their public image. Patients need pills, not PR. How is this good public sector governance?”

The Herald and Smalley revealed earlier this month that Fitt wrote several emails, including regular messages to her communications team about Smalley, who has strongly advocated for more drug funding, including through an organisation she founded, The Medicine Gap.

One of her communications team told Fitt in an email that Smalley was an activist not a journalist, to which Fitt responded: “Yep agree, the good thing is that she has a terrible time slot [on Today FM] and not much of a following”.

Another senior staff member described a “nauseating” Smalley interview on her radio show, while another said she’s “gunna be out of a job” with the closure of Today FM. A third Pharmac staff member said Smalley would be “mega shitty” about not getting an interview with their CEO, while a fourth worker wrote a limerick about the broadcaster.

Broadcaster Rachel Smalley and some of the internal Pharmac email comments made by staff.

The communications were revealed after Smalley lodged a Privacy Act request.

Various patient advocates and groups have called for Fitt to resign over the emails.

However, she survived a regular meeting of Pharmac’s board, held today. In a media release, Pharmac said a number of actions would be taken, immediately or in the next three months.

Those include strengthening the induction for all staff and advisers “to ensure a stronger focus on responsibilities as public servants”.

Pharmac has also pledged to improve how it interacts with patients, advocates and others, and increase what information in the public interest is proactively released.

Training will also be done on “the machinery of government”, including the Privacy Act, Official Information Act and Code of Conduct.

“The board will be provided with regular updates on the implementation of the action plan, and we will closely monitor progress,” Maharey said.

In a statement, Fitt apologised for the comments made in several internal emails, and said her action plan was to “ensure we do not see a repeat of this”.

”As the chief executive, I am ultimately responsible for leading and setting the tone for the organisation. I did not meet this expectation and deeply regret my actions.

”I am confident that what we have agreed today will lead to a better culture and a better Pharmac.”

Minutes from today’s meeting show the board asked Fitt to make a public apology.

Fitt was appointed in January 2018. She was previously the agency’s director of operations, and chief pharmacist at Auckland Hospital.

Prime Minister Chris Hipkins has said “the comments made by the chief executive of Pharmac are totally unacceptable”, but were a matter for the board.

Pharmac is the Government’s medicine-buying agency, and independently decides what drugs to fund from a limited pool of money allocated by the Government.

Its board is appointed by the Health Minister. It is chaired by Maharey, a former Labour Government Cabinet Minister and the former Vice-Chancellor of Massey University.

Other members include Dr Peter Bramley, Talia Tiori Anderson-Town, Dr Anthony Jordan, Dr Diana Siew, and Dr Margaret Wilsher.