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Options for funding better access to medicines

Posted by Martin Palin

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Apr 12, 2017 11:29:51 AM



I noticed policy consultant Terry Barnes berating health advocates recently about the need to suggest “offsets” when lobbying on medical budget issues.




It got me thinking about the way we reimburse medicines and the enormous financial pressure on the system we use to make medicines more accessible. It’s a great system. But where will the offsets come from?

I’ve often heard it said that our Pharmaceutical Benefits Scheme (PBS) is the “envy of the world”.

It takes an evidence-based, largely public-funded approach to the provision of medicines for Australians that need them. An expert advisory committee provides guidance to the government about which medicines can be cost-effectively reimbursed given the prospect of better health outcomes.

As medicines have become much more expensive to develop and manufacture – primarily driven by the growing acceptance of of biological medicines over the past two decades and the recent emergence of immuno-oncology agents for cancer – reimbursement has come to have more telling budget implications for the federal purse.

These issues are canvassed extensively in a new report just released (12/4/17) based on a roundtable convened by the George Institute for Global Health.

It provides some great food for thought and I offer a couple of additional observations here.

First, in advocating new listings on the PBS we’ve got to find candidates and approaches that will provide offsets. It can’t all be about constantly advocating for new, expensive medicines to be added, and added and added. We’ve got to provide offsets or substitutes for some that are already reimbursed.

This is why biosimilars are so important. They have the potential to deliver the same clinical outcomes as the medicines already listed – but at a fraction of the cost. So being ‘pro-biosimilars’ as a general approach strikes me as a sustainable policy.

Second, if there are medicines that don’t meet the appropriately high levels of cost effectiveness set by the system, then we need to accept that not listing those medicines is good public health policy. It does little good for manufacturers and advocates to focus on just one side of the equation. If something is not being recommended then clearly there are some issues related to cost effectiveness or an expensive side effect profile. No number of media exclusives featuring affected patients – ironically often organised by agencies like ours – is going to change that.

We all just need to accept there are always two sides to every story about why a particular medicine is not being reimbursed.

So there’s my two additions to the discussion about the PBS. First, offsets via medicines that can bring the overall costs down to make the system more viable. Second, increased respect for the fact that the bar needs to be set high for new additions and if a specific medicine is being rejected it is being done so in the legitimate broader interest.

Topics: health, pharmaceutical industry, health policy, medicines, pbs


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