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Managing pharmaceutical expenditure while increasing access. The pharmaceutical management agency (PHARMAC)
1Pharmaceutical Management Agency (PHARMAC), Wellington, New Zealand. richard.braae@pharmac.govt.nz
Pharmacoeconomics
|March 21, 2000
Summary
The Pharmaceutical Management Agency (PHARMAC) in New Zealand improved pharmaceutical subsidy value through proactive drug selection and innovative contracts. This strategy controlled costs while expanding patient access to medicines.
Area of Science:
- Health Policy
- Pharmaceutical Economics
- Public Health Management
Background:
- The Pharmaceutical Management Agency (PHARMAC) manages New Zealand's pharmaceutical subsidy expenditure.
- Previous policies may not have optimized value for government pharmaceutical spending.
Purpose of the Study:
- To evaluate PHARMAC's proactive strategies in managing pharmaceutical expenditure and improving value.
- To assess the impact of PHARMAC's initiatives on cost control and patient access.
Main Methods:
- Implementing reference pricing across drug groups.
- Engaging in innovative commercial contracts with pharmaceutical companies.
- Utilizing cost-utility analysis for expenditure assessment.
Main Results:
- Significant slowing of pharmaceutical expenditure growth, with a notable decrease in 1998/1999.
- Expansion of patient access, evidenced by increased prescription numbers and subsidized new drugs.
- Improved overall value of government pharmaceutical expenditure.
Conclusions:
- PHARMAC's proactive approach successfully enhanced the value of pharmaceutical subsidies.
- Cost containment by PHARMAC freed up funds for investment in other health services.
- The agency's strategies demonstrate effective pharmaceutical expenditure management.