It’s all in the definition – “drug” or “pharmaceutical item”

AstraZeneca has been unsuccessful in its attempt to overturn a decision of the Minister for Health and Ageing to include a particular dose of rosuvastatin (sold as Crestor, to lower cholesterol) in the Statins-HP “therapeutic group” on the Pharmaceutical Benefits Scheme (“PBS“). The effect of the Minister’s decision is to reduce the PBS listed price of Crestor (and ultimately, the price which AstraZeneca may charge) on the basis of the listed prices of other drugs such as atorvastatin (Lipitor) within the therapeutic group.

Therapeutic groups are groupings of drugs on the PBS which are considered by the Minister (acting on the advice of Pharmaceutical Benefits Advisory Committee) to be “interchangeable on an individual patient basis”.  The PBS price of a particular drug is affected by the lowest priced drug within the therapeutic group, and drugs within the same therapeutic group are subject to the same price reduction mechanisms, such as the automatic 16% price reduction for all drugs within a group following the introduction of a generic equivalent of one of the drugs within the group.

The Federal Court dismissed AstraZeneca’s argument that the relevant question when determining whether a product should be included in the same therapeutic group as another drug is whether a particular pharmaceutical item, or a particular dose (here, a 40 mg dose of Crestor), is interchangeable with a formulated dose of another drug within the therapeutic group.  Rather, the Court upheld the Minister’s decision that the relevant question to ask is whether the drug (here, rosuvastatin) is interchangeable on an individual patient basis with another drug (atorvastatin).

The Court also noted that while the Minister must obtain the advice of the PBAC when making such decisions, the advice of the PBAC is not binding.

The full text of the decision is here.

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