Proposing to decline some medicine funding applications on the Options for Investment list

What we’re proposing

Pharmac is proposing a change to bring greater clarity and transparency to how we manage medicine funding applications on the Options for Investment (OFI) list(external link).

The OFI list includes medicines that have been assessed and recommended for funding by our advisory committees. Pharmac ranks these applications from highest to lowest priority using our decision-making framework, the Factors for Consideration.

However, some applications have remained on the list for years, ranked low and unlikely to be funded, not because they aren’t important, but because other applications are assessed as having higher priority. Sometimes we also fund newer and more effective medicines for the same condition, but the application for the original medicine stays on the OFI.

We’re proposing to decline some of these low-ranked applications to provide greater clarity. This would apply only to applications that:

• Are in the bottom 20% of the OFI list (if the list has more than 100 applications), or the bottom 10% (if fewer than 100).
• Have remained in that lowest group for more than two years.

A decline would reflect the evidence available at the time and could be resubmitted or reconsidered at a later date. For example, if:

• New evidence shows the medicine is more effective
• A supplier offers a lower price.

Why we’re proposing this

People want greater clarity about the status of medicines on the OFI list.

Pharmac’s role is to make fair and balanced decisions about which medicines to fund, based on the best available clinical evidence, advice from health professionals, and input from people living with health conditions.

We have heard from people, and the clinicians who support them, that having an application on the OFI can feel frustrating and uncertain. Feedback from suppliers and from the recent consumer engagement workshops highlighted that people often feel left in the dark about whether a medicine will ever be funded.

They have told us they want transparency and clarity - even if that means a medicine won’t be funded - so they can plan accordingly. By identifying applications that are unlikely to be funded, we can be more transparent about our funding intentions. This will help people to make informed decisions and will support more open conversations about expectations and priorities.

We understand that these decisions affect people’s lives, and we are committed to approaching this process with care and transparency.

We’ve already taken steps to improve clarity by reviewing older applications known as inactive applications - those that are unlikely to be funded due to factors such as:

• A recommendation to decline from our clinical experts over a year ago.
• Other funded medicines already available for the same condition.
• No additional benefit or potential harm.
• No supplier able to provide the medicine in New Zealand.

Since 2019, we’ve consulted on proposals to decline over 600 inactive applications. More than 500 have now been declined, with some retained for further consideration following public feedback

What would the effect be?

If this proposal goes ahead:

• People will have clearer information about which medicines are unlikely to be funded.
• Applicants and clinicians can make more informed decisions, avoiding prolonged uncertainty.
• Pharmac will be making it clearer which applications have a higher likelihood of funding.

If the proposal does not proceed:

• The current system will remain in place.
• Low-ranked applications will stay on the OFI list with little chance of being funded, and without clear communication about their status.

We understand that these decisions can have real impacts, and we’re committed to listening. We welcome your feedback on this proposal and how we plan to identify applications for decline.

Who we think will be interested

• People prescribed medicines
• Prescribers
• Pharmacists
• Healthcare groups
• Health New Zealand and Sector Operations
• Software providers for prescribing/dispensing
• Suppliers and wholesalers

To provide feedback

Send us an email:applicationfeedback@pharmac.govt.nz by 5pm Monday 17 November.

All feedback received before the closing date will be considered by Pharmac’s Board (or its delegate) prior to making a decision on this proposal.

Your feedback may be shared

Feedback we receive is subject to the Official Information Act 1982 (OIA). Please be aware that we may need to share your feedback, including your identity, in response to an OIA request. This applies to anyone providing feedback, whether they are providing feedback themselves or for an organisation, in a personal or professional capacity.

We can only keep feedback confidential as allowed under the OIA and other related laws. If you want any part of your feedback treated as confidential, you need to tell us. Please let us know if you want to keep part of your feedback confidential, and why. Is it commercially sensitive, confidential or proprietary, or personal information? Clearly state this and tell us which parts of your feedback you want to keep confidential for these reasons. We will consider your request under our OIA requirements.