PHRM4021 Integrated Pharmaceutical Development 1


Make a critical analysis of the following issue.

“The Australian Pharmaceutical Benefits Scheme, and the consumption in Australia of medicines.”

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Answer to Question: PHRM4021 Integrated Pharmaceutical Development 1


The Australian Government developed the pharmaceutical benefit scheme (PBS), which allows prescription drugs to be provided at subsidized rates for Australian citizens.

This scheme was established by the Pharmaceutical Benefits Act in 1947.

PBS was established in 1948 under the Pharmaceutical Benefits Act of 1947. Its main purpose is to make sure that all Australians have reliable access to necessary and affordable drugs.

PBS is being examined due to the rising cost of drugs (Cheng, et al. (2012)).

PBS does not include a hospital setting, which is the responsibility for the state and local governments. Instead, it focuses on the community.

So, the PBS scheme and Medicare are both fundamental components of Australian Healthcare.

Medicare benefits are available for medications not listed within the pharmaceutical benefit scheme.

The PBS scheme has both its opportunities and its challenges.

The PBS scheme has to enroll new pharmaceuticals. This is one of its greatest challenges.

The cabinet has to approve 10 million annually.

The listing of some pharmaceuticals, such as schizophrenia, chronic pain, severe asthma and chronic pain, has been delayed due to budget pressures ( 2018).

This study is based in part on an analysis of Australia’s Pharmaceutical benefits scheme and Australia’s use of medicines.

General Discussion

The Pharmaceutical Benefit Scheme, or PBS, was created in the healthcare facility to allow for medication to be delivered in an emergency.

This PBS chart contains both PBS medication and non-PBS medication and is based on all available evidence (Clarke 2012.

These PBS medication tables are still the same, although they have been divided into different sections depending on how much and when the drug is available.

The following chart gives an overview of this process (Mellish, et. al. 2015).(Mellish et al., 2015)

As can be seen in the PBS listing, the number of lifesaving medications in the PBS program was reduced over time. This affected the patients and their health.

One medicine may only be included on the PBS list if it is registered under Therapeutic Goods Administration, per the National Health Act 53 and the National Health (Pharmaceuticalbenefits) Regulations 1962.

The government has created the Pharmaceutical Benefits Advisory Committee as a non-governmental body that will decide the inclusion of medicines in the PBS.

This table shows how the Australian government spent on PBS over the years and how new drugs were added to the list. (Cheng et. al., 2012).

The following table shows that the PBS’s generation, participation, update, and maintenance has experienced a steady growth from 2005 to 2013.

These years have seen an increase in annual growth, but the rate at which other sections of the PBS are growing has been almost 20%.

In the following table, you can see how annual growth is calculated from annual expenditures.2008-092009-102010-112011-122012-132013-142014-15




Expenditure (millions).96,38377,473139,473133,554154,417141,504151,42412.68%

Annual Growth Rate-19.62%80.03%-4.24%15.62%-8.36%7.01%

With 63% of all PBS budget, the expenditures in chemotherapy have been cited as the fastest growing in the medication sections. Further, the drugs that were generated for life threatening disease and rare diseases had 13% of the total expenditure (, 2018).

The financial implications must be discussed, including changes to the Australian health budget, the DHS, MBS, medication restrictions, and increased medication usage. This will affect the financial condition of the authority providing the PBS scheme to the population and the risk of disease will increase due to increased uncertainty of medication use (, 2018).

The Issues

PBS Problems- The annual cost of PBS from 2005 to 2014 has risen to 9 billion from 6 million dollars.

This is a 52 percent growth, which means that prices have risen about 6 per cent each year.

The price of highly subsidised drugs has increased by 200%, but the average annual increase is 23 per cent.

This increase is due to the availability of high-end pharmaceutical and treatments of Hepatitis C, HIV therapies, small molecules that act against the growth of cancer (Vitry&Roughead 2014.

Another problem is that the enlistment for the new pharmaceuticals has been delayed by budget pressures.

These new drugs deal with pharmaceuticals that are associated with severe asthma, chronic and persistent pain, schizophrenia (Page und al., 2015.

There are many other issues that taxpayers face, including whether they are getting enough value for their money, sufficient funds to treat the aging population, cost effectiveness and prediction of long-term outcomes.

There are issues regarding justification for drugs that are extremely expensive and finding the right resources to relocate them (Mellish et. al., 2015).

What can be done better/differently?

– The profit-driven pharmaceuticals industries are the most popular in Australia, and they are looking for affordable drugs.

It is therefore not surprising that patents on expensive therapies will soon expire.

There is an alternative solution. It involves the creation of biosimilar molecules that behave in the same way as mimic molecules.

It is possible to use biosimilar drugs and therapies to lower the cost.

These biosimilar therapies and drugs are different, so it is important that they undergo the same evaluations before being made available for marketing (Denaro& Martin (2016)).

Another reason for price rise is that the vast majority of prescribed drugs fall under the generic category, but only a small percentage of it falls within the therapeutic class.

Price disclosure could be one of the methods of reducing the price of patent-pending drugs.

This will reduce the price significantly (Clarke, 2012).

Reasons for drug addiction: Sedatives or analgesics are most often overused or abused ( (2018)

This is because these drugs are more readily available. The other reasons for the misuse of drug are losing weight, being dependent on the drug, having issues with the withdrawal symptoms, to experience the same effects, providing false information regarding the quantity of the drug usage, neglecting activities like study and work (, 2018).


The Australian government introduced the drug benefit scheme for countrymen to improve and enhance their healthcare. This should be reversed.

PBS should be modified to improve its reliability.

The first is the section on the incorporation of drugs to the PBS lists.

Because the process takes so long, patients who are really in need of the medicine can’t get subsidy and must pay a large amount of money to receive it.

A quick incorporation strategy must be implemented.

It is essential that drug availability be maintained so that Australia’s citizens are not inconvenienced by the inability to obtain PBS-enlisted drugs.

These are some of the recommendations that the PBS authority should implement to improve reliability.

ReferencesCheng, A. C., Turnidge, J., Collignon, P., Looke, D., Barton, M., & Gottlieb, T. (2012).

Australia. Successful regulation of fluoroquinolone resistance.

Emerging infectious illnesses, 18(9) 1453.Clarke, P. M. (2012).

Opportunities and challenges of the Pharmaceutical Benefits Scheme.

The Medical Journal of Australia (196(3)), 153-154.Denaro, C., & Martin, J. (2016).

The challenge of high-priced drugs.

Australian prescriber 39(3), (2018).

Drug abuse. Retrieved from, L., Karanges, E. A., Litchfield, M. J., Schaffer, A. L., Blanch, B., Daniels, B. J., … & Pearson, S. A. (2015).

Researchers can use the Australian Pharmaceutical Benefits Scheme data collections as a guide.

BMC research notes, 8(1). 634.Page, E., Kemp-Casey, A., Korda, R., & Banks, E. (2015). Using Australian Pharmaceutical Benefits Scheme data for pharmacoepidemiological research: challenges and approaches.

Public Health Res Pract. 25(4). (2018).


(2018). Retrieved from, A., & Roughead, E. (2014).

Managed entry agreements to purchase pharmaceuticals in Australia.

Health Policy. 117(3). 345-352.

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