There is no case for any further cuts to be made to spending under the Pharmaceutical Benefits Scheme (PBS), according to representatives of Australia's pharmacy and drug manufacturing sectors.

In the latest Scorecard analysis of the PBS produced by the Medicines Partnership of Australia, the partners point out that the pharmaceutical industry and community pharmacy have already agreed to extensive savings which are worth several billion dollars, and some of these are yet to kick in.

"Now is not the time to impose new measures that could threaten the viability of parts of the industry," warns the Partnership, whose members are industry bodies Medicines Australia, the Generic Medicines Industry Association and the Australian Self-Medication Industry, plus The Pharmacy Guild, the Pharmaceutical Society of Australia and the National Pharmaceutical Services Association.

Recent data on the PBS shows that growth remains low and is continuing to trend downwards, says the Partnership's latest Scorecard. The increase in government expenditure on the Scheme in the year ended September 30, 2011 was 5.7% and, after adjusting for inflation, this represents growth of approximately 2% in real terms, it says.

Moreover, growth in the Scheme is declining decade on decade, the Scorecard shows. Ten-year average growth in the PBS during the last decade (2000-01 to 2009-10) was 9.2%, compared to 11.7% during 1990-91 to 1999-2000 and 15.9% during 1980-81 to 1989-90, and publicly-available data shows that, in the year to June 30, 2011, the Scheme's expenditures grew just 5.2%. This rate of growth reaffirms that the long-term downward trend is continuing, says the Partnership.

Moreover, over the last decade, PBS expenditure as a proportion of Gross Domestic Product (GDP) has remained steady at 0.6%-0.65%, and while last year's Intergenerational Report - produced by the Treasury to assess the challenges which Australia will face over the next 40 years - forecast that expenditure on the PBS would remain steady at 0.7% of GDP from 2009-10 to 2020, for 2009-10 the percentage was just 0.6% of GDP.

"This is a sustainable level of growth, and existing arrangements such as price disclosure will ensure expenditure remains well under control," say the Scorecard partners.

They also point out that a major round of PBS reform price reductions is due to take effect on April 1, 2012, and that these will average 23% across more than 200 drug products.

The Scorecard concluded that, based on all the evidence, PBS growth is running “at a completely acceptable rate, and continues to provide huge benefits for the nation." 

In fact, it adds, the Scheme "represents the most cost-effective element of health expenditure, and should not be subjected to further savings measures which could threaten the best-subsidised medicines scheme in the world."