Patient Voice Aotearoa (PVA) welcomed the Government’s indication that it will announce a review of its drug purchasing
agency Pharmac. Since its inception, PVA has asked for more scrutiny of a system which sees thousands of kiwis stranded
without appropriate pharmaceutical options, or with vastly inferior treatment options, for illnesses and conditions
which are treated as a matter of course by countries less economically able than New Zealand. The lack of a considered
or coherent medicines strategy and the piecemeal approach to funding drugs has led to gross inadequacies in the standard
of care in Aotearoa. As many PVA members note “Pharmac is all very well……until you’re sick.”
“With New Zealand having slipped behind every other OECD country in terms of spending on and prioritisation of
life-saving and life-improving treatments, the review is long overdue” observed long-time access to medicines advocate
and PVA founder Malcolm Mulholland. He said “It’s simply devastating to hear stories every day of kiwis who are
essentially being picked to die or live hugely compromised lives because medicines that are considered routine in other
countries are out of reach to all but the wealthiest New Zealanders.” He added “Give-a-little should not be the only
avenue for hope. But that’s all that many people have left.”
Patient Voice Aotearoa has identified specific areas of interest that should be integrated into any credible review of
Pharmac. When asked what he thought would signal that the Government was genuinely interested in fixing the problem and
not simply undertaking a box-ticking exercise, Mulholland said “We need to at least double the Pharmac budget, so that
our medicines spend is comparable to other OECD countries. This must happen immediately to lift thousands of people out
of a life of illness or no life at all. Successive Governments have lauded budget increases which are so inadequate
that, with population growth and inflation, they actually represent a net loss to the budget. Any delay will cost
Fellow PVA leader Fiona Tolich added “In addition to a methodical medicines strategy, we need a ring-fenced
pharmaceutical budget so that we know what is being spent and exactly where the money is going. At the moment all of
this is blurred. Rare diseases which have long been ignored or dumped into the too-hard basket need to be acknowledged
through a better, more efficient and responsive process. There‘s also utility in having an onramp and rapid access
scheme for new medicines because the technology is evolving so much faster that the sluggish bureaucracy we’ve been
relying on for decades.” Both Mulholland and Tolich are adamant that this should all be part of a review. PVA believes
that a review should also look at procedural transparency, the potential to appeal decisions, the issues of informed
consent with any medicines switches and better utilisation of international standards and norms.
PVA wants Pharmac to be asked about why there is so often a gap between what technical experts recommend and what it
funds. Why so many decisions seem arbitrary (for example a medicine excellent at treating a range of cancers is only
approved for one.) Why it takes so long to get a medicine through due process in New Zealand when other countries have
much better and more streamlined systems. Why some conditions are completely ignored. And why there’s such a pervasive
blanket of secrecy thrown over an area of health which is quite transparent in most other countries. In short, the
culture of Pharmac must be scrutinised.
Mulholland and Tolich stress that patient advocates need to be part of any panel reviewing Pharmac, and also agree that
any review will ultimately be judged on whether or not it addresses the actual questions that sit at the heart of
Pharmac’s failure to treat kiwis in line with international best practice and with compassion and care. “We do not want
to see any further collateral damage whilst waiting, this is a crisis and warrants an emergency response.”FAQS ABOUT PHARMAC1 PHARMAC HAS BEEN AROUND FOR AGES AND WORKS WELL?
When Pharmac was established, there were many blockbuster drugs in the pharma pipeline (Prozac was new, Viagra etc) and
economies of scale, bulk buying and bundling contracts had some utility. Now there are many more tailored, biologically
nuanced, immensely sophisticated drugs that are incredibly effective for particular groups of people. The advances in
technology to treat cancer, diabetes, multiple sclerosis, cystic fibrosis, and many rare diseases is extraordinary. Our
system is too outdated and sluggish to keep up.2 BUT WHAT DO KIWIS REALLY MISS OUT ON
That answer is changing all the time. But it doesn’t look good.
But there are just under 300 modern medicines for conditions including arthritis, cancer, asthma, CVD, diabetes and rare
disorders. These medicines are publicly funded in 19 other similar OECD countries to NZ. There are more than 100
recommended medicines from PHARMAC’s own technical experts, that are still not publicly funded by PHARMAC/DHBs. So, over
235,000 New Zealanders are missing out on those medicines while patients in countries like Greece, Estonia, Peru,
Mexico, Kazakhstan, Moldova and Lebanon have public access to them.3 PHARMAC ALREADY GETS A LOT OF MONEY. ISN’T THAT ENOUGH?
For starters, Pharmac’s budget includes both expenditure for medicines and medical devices. The Government needs to come
clean on expenditure for medicines only and not include medical devices. Also, Pharmac’s two most recent funding
increases during Covid-19 ($35m and $150m) are to ensure the continued supply of generic medicines and not the purchase
of modern medicines. Medicines that other countries are mostly able to supply because they do not employ risky sole
supply agreements like Pharmac has favoured. This funding increase, saw Pharmac’s budget reach $1b.
If medicine funding for New Zealand was in keeping with the OECD average, the agency would be receiving close to $3b.
Remember, we are talking about an entity that is responsible for subsidising medicines and medical devices for the
entire population of New Zealand. While the entire health budget has increased over time, the budget for medicines has
not kept up with population growth or inflation since 2007.
This is the most fundamental question that any inquiry or review of Pharmac needs to tackle. Is Pharmac’s budget fit for
purpose and how should Governments determine the level of funding Pharmac requires? The chronic underfunding of Pharmac
is why there are so many issues concerning Pharmac. Unless you fix the lack of budget for Pharmac, then other issues
will remain to plague the agency, and as a result, the health of New Zealanders.
4 BUT THE CURRENT GOVERNMENT HAS INCREASED THE BUDGET OF PHARMAC?
Not really. The Labour Government said it would add $200 million over four years. So, $50 million a year. When assessed
alongside population growth and the growth of particular disease categories, it actually represents a net loss. The
Government throws out a credible sounding figure but then downplays the fact it’s going to be rationed out over the best
part of half a decade.3 BUT ISN’T NEW ZEALAND THE ONLY COUNTRY IN THE WORLD TO OPERATE A CAPPED FUNDING SYSTEM?
Other countries have capped budgets, as they don’t have unlimited amounts of funding. However, the key difference, is
that they fund their medicine buying agencies better and so they are able to provide more medicines, which leads to
better health outcomes.4 SO WHY DOES PHARMAC RETURN MONEY TO VOTE HEALTH?
Pharmac has a history of returning money to Vote Health because the only focus of Pharmac is to save money. Pharmac’s
sole goal should be to improve the health of New Zealanders. For example, Pharmac returned $200m to offset the wage
increases given to nurses. Nurses deserved a wage increase but the money should have come from elsewhere and the $200
million saved by Pharmac should have gone towards buying more medicines.5 HOW MANY GIVEALITTLE PAGES HAVE BEEN SET UP FOR PATIENTS NEEDING TO SELF-FUND MEDICINES?
We don’t know for sure, but just for cancer patients there have been in excess of 4500. Such a figure is evidence that
Givealittle has become the surrogate for Pharmac. This is now how New Zealand patients are having to fund the medicines
they need. Sadly, in their hour of need, they are having to beg for their lives, rather than rely on Pharmac. This is
without looking at the number of people who have sold their cars, boats or houses before resorting to begging.6 BUT GIVING PHARMAC THE MONEY IT NEEDS, IT COSTS TOO MUCH.
How much money is your life worth? The NZTA values a life 20x more than Pharmac. How much money has the Government spent
on Covid-19 to prevent people from dying? Why are the lives of those who need a medicine, less than those who require a
vaccine or life-saving surgery? And what economic considerations are given to purchasing a medicine to either improve,
save, or prolong a life, and the money that would be saved elsewhere in the New Zealand medical system and in society in
general?7 WHO IS RESPONSIBLE FOR PHARMAC AND ITS BUDGET?
The Minister of Health and the Government.8 BUT PHARMAC DO FUND SOME MODERN MEDICINES
Most of the modern medicines that Pharmac have funded recently have only been funded due to high profile campaigns that
involve petitions. In 2008, Herceptin was funded after the efforts of the Herceptin Riders; in 2016, Keytruda was funded
for Melanoma after a campaign by Leisa Renwick; in 2019-2020, cancer drugs Ibrance, Kadcyla, Fulvestrant (breast
cancer), Alecensa (lung cancer), Revlimid (myeloma), Venetoclax (CLL), and Lynparza (ovarian cancer), Kalydeco (cystic
fibrosis) and Jardiance and Trulicity (Type II diabetes) are funded after high profile campaigns. In other countries,
such as Australia, patients do not present petitions for medicines to be funded. Sadly, many of the patients who have
been involved with these campaigns have been accused of receiving funding from Pharma companies, without any basis apart
from the suggestion being made by Pharmac.
9 HOW MANY SIGNATURES HAVE THERE BEEN FROM DIFFERENT PETITIONS ASKING THE GOVERNMENT TO GET PHARMAC TO FUND PARTICULAR
24 petitions have been submitted since October 2018, calling on the Government to get Pharmac to fund over 50 medicines,
with 300,000 signatures having been collected. The petition to double Pharmac’s budget and reform the agency, has just
under 96,000 (this includes 5000 hard copies). See: www.sign4life.nz
10 WHY DO POLITICIANS ALWAYS SAY THAT PHARMAC IS THE ENVY OF THE WORLD?
Because they too are motivated by saving money, not saving lives. Show me another medicine funding model like Pharmac.
No other country has a system like Pharmac for purchasing medicines. The only envy other countries have is that we spend
so little on medicines but then many other countries would be appalled at some of our health outcomes.
11 WHY DO POLITICIANS ALWAYS SAY THEY SHOULDN’T SECOND GUESS WHICH MEDICINES SHOULD BE FUNDED AND WHICH ONES SHOULDN’T?
Because they shouldn’t. Politicians shouldn’t interfere in decisions made by Pharmac about which medicines they should
and shouldn’t fund. However, they often deflect questions from the media about medicines that patients want, when they
know full well that they dictate what Pharmac’s budget is, which is the real reason why Pharmac can’t fund certain
There are currently in excess of 100 medicines sitting on the wait list (that have been recommended for funding). Some
of those assessed as a high priority have been waiting for close to six years.
12 WHY DO THE POLITICIANS SAY WE ARE DOING WELL WHEN IT COMES TO HEALTH OUTCOMES AND THAT IS HOW THEY KNOW PHARMAC IS
DOING A GOOD JOB?
Let’s apply that statement to advanced breast cancer (ABC) patients. We know in New Zealand that patients with ABC live,
on average, for 16 months. In other countries such as Australia and the U.K., those with ABC live twice as long (for one
subtype the figure is five years in other OECD countries). The reason? Because in New Zealand there are less medicines
funded that treat ABC compared to other OECD countries. The only reason we know these statistics is because the Breast
Cancer Foundation NZ has kept a data register since 2000. The Ministry of Health admitted to the Health Select Committee
that they don’t collate data by cancer stage. That means they have no idea how long on average a person lives with
advanced cancer once they are diagnosed. We also have no way of knowing a patient’s quality of life, once they have been
diagnosed with a disease or condition.13 DON’T WE HAVE A RING-FENCED FUND FOR MEDICINES NEEDED BY THOSE WITH RARE DISORDERS?
Contrary to what the Minister of Health told the Health Select Committee, a ring-fenced fund for medicines for those
with rare disorders, such as Cystic Fibrosis or Spinal Muscular Atrophy, was disestablished. The reason for a
ring-fenced fund is because patients with rare disorders (there are 300,000 in New Zealand) miss out on funding under
Pharmac’s criteria to fund the cheapest medicines for the greatest number of people.
Medicines that were funded under the old fund included low-protein pasta, low-protein baking mix, and fat supplements. Half of those with a rare disorder are children. Some of them have died waiting.14 WILL A RAPID ACCESS SCHEME HELP?
Yes, but such promises were made back in 2019 by the Prime Minister and to date nothing appears to have happened. Most
other OECD countries already have in place a rapid access scheme. What this means is that patients can access medicines
that are yet to be proven to work, medicines that are being used in new combinations with other medicines, or medicines
that are being applied for a different disease for what they are originally developed to combat. Medicine buying
agencies, such as Pharmac, are normally able to purchase these medicines at a very low cost until they are proven to
work in the way they are being used and then the drug company will apply for the medicine to be funded by following the
normal process. This is a step in the right direction, but it will not provide access to the medicines New Zealand
patients need now. The drugs that are needed now have been proven to work for a number of years and are being supplied
to patients overseas.15 WHY DO THE POLITICIANS SAY MOST MEDICINES WON’T WORK AS THEY SAY ON THE LABEL?
Who knows? They aren’t medical experts.
In New Zealand there are over 100 medicines that the medical experts have said should be funded by Pharmac, but are not.
This is Pharmac’s waiting list. Many of these drugs have been on the list for five years or more and some of these drugs
have been on the list for 15 years. A report commissioned by Pharmac several years ago, titled “Mind the Gap”, attempted
to justify the gulf between cancer medicines funded in New Zealand and Australia.
The report argued that the additional medicines funded in Australia resulted in very little additional health gains,
compared to the medicines funded in New Zealand (and therefore implied that Australia was wasting taxpayer money). This
report was rubbished by numerous oncologists, both in New Zealand and Australia.16 IS PHARMAC QUICK TO APPROVE MEDICINES?
On average it takes four years to approve a drug to be funded; many sit on the Pharmac waiting list for years. On many
occasions, Pharmac asks for clinical data that simply does not exist or funds the drug in a restrictive manner that is
inconsistent with the rest of the world. For example, the lung cancer drug Pemetrexed was funded in 2017, but that was
nine years after the funding application was first made in New Zealand, and 13 years after Australia funded it. CEO of
Lung Foundation New Zealand, Philip Hope, estimates the long delay resulted in 15,000 patients dying sooner or having to
pay for it themselves.17 ISN’T THE PRACTICE OF BRAND-SWITCHING A GOOD TACTIC TO SAVE MONEY?
The sometimes-indiscriminate way Pharmac switches brands can pose an extremely high risk for some patients concerned and
has been likened to “playing Russian Roulette” with people’s lives. It is the way in which Pharmac remains within its
capped budget. Brand-switching is done up to sixty times a year when Pharmac no longer wishes to pay a higher price for
a patented drug and switches the drug to a generic brand. For example, in 2017 Pharmac switched 45,000 patients with
serious mental health issues to a new brand of the anti-depressant drug, venlafaxine, saving Pharmac $5m per year. There
were more than 500 adverse side effect reports, and when asked, Pharmac’s CEO Sarah Fitt was unable to state if the
patients concerned self-harmed or committed suicide.
12,000 patients with epilepsy or mental health issues were also switched to one brand of Lamotrigine in 2019 in order
for Pharmac to save $6m a year. This is despite Medsafe, New Zealand’s medical regulatory body, advising that such
changes go against the “international consensus” and citing data that up to 25% of epilepsy patients could be at risk.
New Zealand’s Chief Coroner is now holding an inquest into the death of six epilepsy patients whose medicines were
switched.18 DO WE HAVE A MEDICINES POLICY IN NEW ZEALAND?
The last Medicines New Zealand Policy expired last year. The responsibility for a medicines policy lies with the
Ministry of Health. This would also account, to some extent, as to why Pharmac does not follow international practises.19 WHY IS PHARMAC APPEARING BEFORE THE CORONER AND THE HUMAN RIGHTS COMMISSION?
Because New Zealand patients and their families have had enough. Pharmac’s risky practise of switching psychotropic
medicines, against international guidelines, may have resulted in up to six epilepsy patients dying. The case is
currently before the Coroner.
Pharmac is appearing before the Human Rights Commission because the Commission has established grounds of discrimination
between children with cancer and children with rare diseases. Children with cancer can access whichever medicine is
recommended by their oncologist (recommended or not, funded or not), whereas a child with a rare disorder, cannot. The
specific case relates to a treatment ranked as a ‘high priority’ medicine by Pharmac being inaccessible with children
passing away while they wait.