New medicines may be held back from Australia because of row over subsidies

MEDICINE companies have warned they may hold back new anti-diabetes drugs and other medicines after the deferral of  taxpayer subsidies on eight new drugs.

MEDICINE companies have warned they could hold back new anti-diabetes drugs and other medicines from the Australian market after federal cabinet's controversial decision to defer taxpayer subsidies for eight new drugs.

The warning comes as a Canadian study reveals Australia is already lagging the developed world in giving patients access to new drugs, with our country ranking 20th out of 29 countries in delivering access to cancer medicines.

The government's expert advisory body the Pharmaceutical Benefits Advisory Committee has approved six new dugs for subsidy, including an anti-cancer agent, but the medicines will now have to fight for cabinet approval before subsidies are paid.

The Consumer's Health Forum said patients would be “outraged and angry” if the drugs weren't listed on the Pharmaceutical Benefits Scheme.

“These medicines have been recommended by experts to treat patients suffering from colon cancer, multiple sclerosis, cystic fibrosis and other diseases,” Medicines Australia chief Brenadan Shaw said.

“The government's own expert committee has said making these medicines available is cost effective, value for money and the right thing to do. I hope cabinet respects those decisions because it's unclear what expertise or experience cabinet ministers have at their disposal to override the decisions of their own expert committee.”

Health Minister Nicola Roxon will face a united front of opposition to the new policy that cabinet approve all medicine subsidies, not just those over $10 million, when she meets a delegation of doctors, patients and medicine companies in Melbourne tomorrow.

“It's unprecedented for industry, professional and consumer groups to unite on anything and that shows this is a short-sighted decision that isn't even cost-effective,” Consumer Health Forum chairperson Carol Bennett said.

Medicine companies warned they would have to carefully consider whether to apply for medicine subsidies now there was a risk cabinet could reject or defer them.

Drug company Novo Nordisk warned the uncertainty around subsidies "will impair” its ability to bring its range of new anti-diabetic medicines to Australia.

“If we don't get certainty we will have to consider the feasibility of any future submissions," Novo Nordisk managing director Peter Soelberg told The Australian Online.

Drug companies Amgen and Eli Lilly have told the Medicine industry journal Pharma in Focus that cabinet's new policy would be a hurdle they would take into account before deciding whether to apply for subsidies for new medicines.

It costs drug companies $125,000 to apply for a taxpayer subsidy and a further $25,000 to go through the process by which the government sets the price will pay for the drug under our subsidy scheme.

Medicine companies usually have to pay for this process at least twice with only 30 per cent of medicines successfully gaining a subsidy on their first application.

The Canadian Rx&D International Report on Access to Medicines 2009-10 found the proportion of first-in-class medicines that were subsidised in Australia is 52 per cent, compared with an OECD average of 65 per cent.