Moving forward together
In December 2007 the Government introduced the Medicines New Zealand strategy and action plan, creating, for the first time, an overarching strategy for the use of medicines in New Zealand.
It was a major piece of work, led by Associate Minister of Health Peter Dunne, and would have significant implications for PHARMAC’s operations from that point on.
The strategy set out three main objectives for the country when it came to medicines:
- Quality, safe and effective medicines
- Equitable and affordable access
- Optimal use of medicines resulting in optimal health outcomes.
PHARMAC already played an integral role in all three categories and, through late 2006 and early 2007, numerous stakeholders contributed wide-ranging views on the agency’s future role in evaluating, acquiring and supporting the optimal use of medicines.
While not intended as a review of PHARMAC, the strategy consultation period lent the agency a prime opportunity for self-reflection, as chief executive Matthew Brougham outlined in PHARMAC’s own submission on the strategy.
The agency identified “no significant weaknesses in the structures or processes underpinning PHARMAC’s operations”, but saw scope for making them more effective.
“We can do a better job of taking people with us,” noted Brougham, suggesting better communication and stakeholder engagement from PHARMAC were required. He also identified potential benefits from implementing a longer budget period and introducing a more competitive tendering process for new, innovative medicines, replacing the one-on-one negotiations that existed at the time.
Fundamentally, PHARMAC cautioned against re-engineering a system that had proven to be successful.
“Some interest groups are likely to call for radical change of some systems and structures to advance their own particular interests and priorities,” wrote Brougham.
“However, from our perspective as an agent of government and the public at large, the public interest is already served very well, and is best served by continuing evolutionary development (as the Ministry proposes), rather than revolutionary wholesale change.”
The strategy, in its final form, satisfied that need identified by the government and health sector and consumer stakeholders for more coherence and transparency in the medicines system.
For PHARMAC, the action list included implementing a regular forum for stakeholders – both funding applicants and consumers – to comment on PHARMAC’s operations.
The district health boards (DHBs) and PHARMAC would move to a principles-based approach for setting the community pharmaceuticals budget and PHARMAC would start publishing summaries of decisions on medicines funding applications.
The operational guidelines and terms of reference for PHARMAC’s Pharmacology and Therapeutics Advisory Committee and Consumer Advisory Committee respectively were to be reviewed to ensure appropriate checks and balances and clear accountability.
It flagged a review of the Exceptional Circumstances funding and criteria and PHARMAC was charged with developing a system to ensure people had access to funding in certain circumstances when decisions led to brand changes in medicines.
The strategy also called for nationally coordinated decision making, funding, and procurement of vaccines, which would foreshadow PHARMAC’s assuming responsibility for procuring vaccines on a nationwide basis.
By November 2008, when Brougham wrote his briefing to incoming Minister of Health Tony Ryall, PHARMAC’s actions had all been completed or advanced.
But the agency saw particular additional scope for PHARMAC to play a role in the ‘optimal use of medicines’ category of the strategy. As Brougham had written in PHARMAC’s submission on the strategy:
“In our view, the health gains which can be achieved by improving the use of medicines potentially significantly outstrip any gains which can be made on the supply side.”
The following years would see an increased focus on demand-side initiatives at PHARMAC as it pursued that ‘optimal use’ goal.
The Medicines New Zealand strategy and accompanying action plan served to provide the greater cohesion and cooperation across the health sector its architects had desired. A second action plan was released in 2009 and a third in 2015, Implementing Medicines New Zealand 2015 to 2020, introduced legislative changes to more effectively deal with new technologies, such as medical devices and cell and tissue therapies.
Medicines New Zealand provides an overall framework for PHARMAC’s operations today and is notable for the consensus of opinion on the fundamentals for a healthy medicines system that underpin it.
Last updated: 13 September 2018