PHARMAC’s recent decision to fund two additional drugs from December this year has been widely welcomed by patients and
the general public alike. The drugs, Kadcyla and Alecesana, are used in the treatment of advanced lung and breast
cancers and will prolong and improve the quality of life of many affected patients who have been unable to afford them
before now. Both drugs have been the subject of high profile campaigns from patients and their advocates who have long
felt that the system has been too insensitive and slow to act upon their concerns. Against that backdrop, this recent
PHARMAC decision was seen as something of a watershed.
The process by which PHARMAC decides which medicines to fund is rigorous and thorough, for obvious reasons, but
consequently it is also very slow. Medicines recommended for funding by the Pharmacology and Therapeutics Advisory
Committee (PTAC) can often wait months and in some cases years to be approved for funding by PHARMAC. PTAC is PHARMAC’s
primary technical advisory committee and operates with an understandable sense of separation and independence.
Critics say that is a major part of the problem, and that a better model to follow would be that of Britain’s National
Institute for Health and Care Excellence (NICE). They point out that once a drug has been recommended by NICE for
funding it has to be funded immediately. As there is no equivalent to PHARMAC in Britain, it is the National Health
Service (the NHS) that has to pick up the tab alongside all the other health expenditures for which it is responsible.
As part of its decision-making process NICE does attempt to undertake some cost-benefit analysis and assessment of the
cost–effectiveness of new treatments, but funding remains the responsibility of the NHS.
In New Zealand, where there has never been a very strong pharmaceutical industry, even in the best of times, mainly
because of our small population size and distance from world markets, controlling the overall level of expenditure on
pharmaceuticals has always been a major issue for governments. Until the late 1980s, there was no control; the prices
demanded by manufacturers were paid unquestioningly, and the overall pharmaceutical bill was soaring. PHARMAC and its
predecessor were established at that time to get some control of the level of pharmaceutical expenditure and the prices
multinationals were charging New Zealand suppliers. It is fair to say that in the early years at least it went about its
work with a vengeance and independence that successive Ministers of Health came to welcome, because PHARMAC, not the
government, made all the difficult decisions, and took all the public opprobrium accordingly. PHARMAC was (and is still)
effectively NICE and the NHS rolled into one. Ironically, one of the things other countries and their pharmaceutical
agencies look admiringly at is PHARMAC and its independence.
Over the years, starting with the national medicines strategy, Medicines New Zealand introduced in 2007, there have been
modifications to PHARMAC and its processes to make it more accountable to both patients and the pharmaceutical sector,
although its autonomy remains its cornerstone. However, PHARMAC is still under no obligation to fund any medicine
recommended by PTAC within a specific time frame, if at all. And governments generally choose not to intervene in the
While the Kadcyla and Alecesana decisions have been welcomed, they are by no means the only medicines in this situation.
For example, Adalimumab was recommended for patients with ulcerative colitis in 2018, but is still awaiting a funding
priority from PHARMAC. So too with Ustekinumab, another Crohns and Colitis drug, recommended by PTAC in early 2019 but still awaiting ranking by PHARMAC.
And, as even a cursory glance at PHARMAC’s on-line application tracker shows, there are many other drugs in a similar
limbo, affecting many other patients and conditions.
To deal with this, a government could decide to completely overturn the current system and revert to the previous system
of just paying unquestioningly the prices multinational manufacturers demand for medicines clinically approved by PTAC.
That would be as foolish as it would be short-sighted. So too would be the establishment of dedicated funds for new,
innovative and expensive medicines, which the current government mooted but has now sensibly turned away from. Nor is it
altogether desirable to be tacitly encouraging various high-profile and well-organised campaigns, however heart-rending
and legitimate their cause, to be lobbying to be treated differently from everyone else. That just entrenches the
unevenness and unfairness of existing policy.
What is needed is a much more fundamental consideration based upon sound epidemiological and clinical advice about the
spread of medical conditions prevalent in New Zealand, both by age, gender and cultural groupings, and the range of
medicines most likely to be needed in this country to deal with them. Then, armed with that information, which would
almost certainly include all cancer and bowel related conditions, PHARMAC should be charged with developing a funding
strategy to meet those requirements. In turn, the government would need to ensure that level of funding was made
available and sustained into the future. The trade-off for any increase in spending on medicines would be the reduction
in the need for more palliative services elsewhere.
Such a sharper and more strategic approach would ensure the focus was far more on providing people with the medicines
they need, when they need them. It would be an incredible contrast to the current situation where pharmaceutical funding
levels are incredibly ad hoc. The baseline has not been reviewed in years, and the increases that have taken place have
been quite arbitrary, usually based on no more than what there is to spare in that year’s Health budget. There has been
little evaluation of the efficacy of funding decisions to ensure the right people are getting access to the medicines
they need and that those medicines have been effective. PHARMAC has been left to try to work incredible miracles, and
then criticised when it sometimes fails to do so.
Without such a change of approach, the only resort available to desperate patients is more of the type of lobbying that
preceded the Kadcyla and Alecesana decisions. It is demeaning, debilitating and unfair for people who are often extremely ill. And
whatever else, it is no way to make sound clinical decisions about ensuring people get the medicines they need, when
they need them.
Scoop Editor's note: this article has been amended as the original mistakenly referred to the drug Ibrance when it
should have said Alecesana. ends