Australia’s new Liberal-National Coalition government has announced a new process to fast-track approvals of new medicines which the Pharmaceutical Benefits Advisory Committee says should be subsidised by the government.

The new process will allow the Health Minister to approve promptly medicines that would cost the government A$20 million or less to subsidise in each of the first four years that the product is made available through the Pharmaceutical Benefits Scheme (PBS).

Announcing the new measure, Health Minister Peter Dutton said that the new government is streamlining the PBS approvals processes in order to improve access for patients and give business more certainty.

The subsidy threshold was first established in 2001 by John Howard’s Liberal-National Coalition government. It said that, for drugs which the PBAC says should be made available on the PBS, only those whose subsidy would cost the government over A$10 million a year for each of the first four years would need Ministerial approval.

However, in March 2011 the Labour government scrapped the ceiling and said that all new PBS subsidies would require Cabinet approval. Also, no new medicines would be added to the PBS until 2013, by which time it aimed to have the federal budget back in surplus, it said. 

The threshold’s removal was widely condemned by industry and patient groups, and in August 2011 an inquiry by the Senate Finance and Administration References Committee into the measure described it as “unacceptable” and “based on short-term and ill-conceived goals” which exposed the national health system to “significant risk.”

Ahead of this year’s federal elections in September, the Coalition, led by Liberal leader Tony Abbott, vowed to restore the subsidy threshold, raise it to A$20 million, and also to return “integrity” to the PBS listing process and restore the independence of the PBAC. 

The announcement by Minister Dutton of the new threshold was welcomed by research-based industry group Medicines Australia, which said the industry has been calling for such a policy change for some years.

“This improvement in the process should reduce the time for listing for some medicines on the PBS,” said the industry group’s chief executive, Dr Brendan Shaw.

“This is good news for companies who’ll benefit from greater predictability, good news for government who’ll have more efficient processes and, ultimately, good news for patients who’ll get access to new medicines sooner,” he adde