Senate Community Affairs Legislation Committee [Part 2], , 2:21:43 to 2:26:04
An overview of how the Pharmaceutical Benefits Advisory Committee (PBAC) determines cost-effective pricing and provides guidance to sponsors.
Topics: Health, Procurement
Speakers: Jo Watson, Senator Anne Ruston, Unknown Speaker, Interjection
>> I'm sure you would. Um and just finally so in um in the July and March um payback meetings, PEAC recommended a number of medicines be listed but only if the asking price is reduced. Um just wondering if we could just get an understanding if this is an increasing trend for Peabback to make a sort of recommendation that says they would recommend but only with a decreased
Good evening, Senator Joyce Watson, acting chair PBAC. um PVAC's uh committed to trying to keep as efficient as possible our recommendations as we deliberate and with the utilization of the pathways that we have uh for positive recommendations. We're trying to utilize those pathways as best as possible to give many opportunities to the sponsors with our advice and guidance as to how to progress to a successful listing.
>> Sure. Um so does PBAC advise um companies on how much specifically they would need to reduce their price to be considered cost effective in your analysis.
>> Um in our deliberations we're very conscious of setting out through our minutes that are available to the sponsors at the end of the meeting the the ways forward to progress to a successful listing. that includes the economics uh the clinical arrangements and the way that we want them to see we would be able to establish a cost-effective price that would enable them to go forward.
>> Yeah. Um so I just and yes um that's great just but I'm just understanding though do you actually provide the sponsor with the specific analysis that you've made in your cost effective analysis as part of your process to say we believe that all things considered that your medicine is cost effective at X price
>> very specifically. Yes.
>> Yes. Okay. Thank you. Um, and so how does payback determine when a price reduction on the applicant's price is required and by how much >> and I suppose and and to add to that and how much of a consideration is that in the broader scheme of your considerations about um an application
Well, I think it's a critical aspect of the application's evaluation and assessment. Uh, it goes through a range of technical assessment before it even reaches PBAC, not only with the independent and external academic evaluation process, but also through our subcommittees, the drug utilization subcommittee and the economic subcommittee. PBAC's deliberation after all of that breadth of work and the scope of the submission being analyzed is looking at a price claimed by a sponsor that it wants for its product. PBAC considers looking at incremental comparative cost effectiveness measurements whether or not that benefit compared to the standard therapy, alternative therapies or standard of care, whether or not that incremental benefit both at a clinical level and at a value or money uh economic level is going to be worth so much. And if that doesn't meet what the sponsor has proposed is is its claim price, then we try and give guidance as to what would meet that.
>> So just taking a um as a specific example, I mean there's been quite a bit of um commentary in relation to multiple scerosis um drugs. I'm sure you're aware of it. Um, so I'm just interested, um, when I don't need to go through the whole preamble. You know what I'm talking about, don't do you?