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Australian Journal of Pharmacy : October 2006
capital hill capital hill from our Canberra correspondent N the April 2006 issue of the AJP, in a letter to the editor, John Young, the managing director of Pfizer and chair- man of Medicines Australia (MA), protested about the March Capital Hill column which reported that one of the PBS reform proposals being considered by Health Minister Tony Abbott was ‘similar to a proposal put forward by Pfizer’. Confusion on the path to reform I Mr Young didn’t point out that commu- nity pharmacy had only recently signed the Fourth Guild–Government Agree- ment, and that, as this column pointed out last month, the terms of trade were acknowledged and embedded within that very same agreement. Mr Young wrote: ‘For the record, Pfizer did not put forward any proposal. Pfizer Australia was fully supportive of the Medicines Australia submission to the Pharmaceutical Industry Working Group (PIWG) and the Government’s Inter Departmental Committee’. Readers may not be aware that Mr Young, as chairman of Medicines Aus- tralia, gave a presentation on live televi- sion to the National Press Club on 6 Sep- tember. During his presentation, he was asked a question concerning PBS reform and plans by the Federal Government to take away pharmacists’ trading terms, particu- larly with generics companies. It was a very one-sided question. Mr Young replied that this was a matter for the Minister! This answer was not lost on senior Guild representatives present at the meet- ing. It was particularly insensitive because, at the time, the Medicines Part- nership of Australia, the fledgling umbrella body formed between MA, the Guild and the GMiA, was undergoing some soul searching after it became known that MA was negotiating behind the scenes on the Abbott proposals. In the words of one of those senior Guild members, it was an opportunity to show solidarity—which was lost, and in a very public way. Despite subsequent assurances, the issue remains hot. There is a group of Guild executives who remain very much unmoved by those reassurances. What is difficult to understand is why If the Government wanted to review arrangements it could have done so dur- ing negotiations and not by some sneaky means behind the back door after the Agreement was signed. So what’s Tony Abbott been saying about PBS reform? On 2 August, also at the National Press Club, he said plans for PBS reform were alive and well. They were going ahead and legislation would be introduced before the end of the year. It’s hard to understand where Mr Abbott is coming from anymore Mr Abbott said PBS reform had to go ahead to create ‘headroom’ for new and expensive medicines. What he didn’t say is that not one dollar taken from the PBS so far—from increasing the patient co- payment by 21 per cent, the 12.5 per cent generics cash grab, the 20-day rule and so on—has been set aside for new medicines. Perhaps it’s no surprise to hear that huge savings have gone back into consol- idated revenue. So will any more savings he takes from the PBS—he made this posi- tion public when he told the Australian Financial Review (27 September). It’s a pretty empty argument for creating head room. His other argument is that he needs to make the PBS sustainable. But then in Par- liament recently he admitted that the PBS was growing at less than 3 per cent, which is lower than inflation and a contradiction in real terms. It’s hard to understand 12 ? THE AUSTRALIAN JOURNAL OF PHARMACY VOL.87 OCTOBER 2006 where Mr Abbott is coming from any- more. Then, at the Australian Self Medication Australia conference on 21 September, Mr Abbott claimed that generic medi- cines cost 50 per cent less in Europe than they do in Australia and he can’t under- stand why, and thinks they should be the same price here. He made another gaffe at the same meeting when he mentioned that the trans-Tasman harmonisation process would ultimately mean Australians would be in charge rather than ‘shonky New Zealanders’—something that galvanised a New Zealand government representa- tive to leave the room and convey this descriptive to his masters via a mobile phone. These issues really do underline the fact that this Minister, whose affable persona and approachability mark him as a good bloke, unfortunately suffers from a major problem in terms of the poor advice he receives. He has become a victim of it. The trouble is that the advisers con- cerned simply don’t understand what they don’t understand and offer nothing but the same old ideologically flawed Health Department propaganda from the estab- lishment. The quality of this advice and lack of understanding has caused him to fail to comprehend that it was the Govern- ment’s 12.5 per cent policy and price-ref- erencing system that has stone-walled the process which might have otherwise led to a decline in Australian generic prices to similar levels throughout the rest of the world. The Minister needs to get some better advisers! We simply cannot allow deci- sions to be made that are going to hurt patients, pharmacy and industry, particu- larly when these decisions are being made with the wrong facts. The opinions expressed in this column are not necessarily those of the AJP’s management or staff ¦