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Request For Proposal for the Provision of Consultancy Services for the Development of PBS Stockholding Guidelines
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The Commonwealth of Australia acting through the Department of Health (Department) is responsible for better health and wellbeing for all Australians. The Department aims to achieve its vision through strengthening evidence-based policy advice, improving program management, research, regulation and partnerships with other government agencies, consumers and stakeholders. The Department administers the National Health Act 1953 (Cth) (the Act).
The Pharmaceutical Benefits Scheme (PBS) provides timely, reliable and affordable access to necessary medicines for Australians. Under the PBS, the Commonwealth subsidises the cost of Pharmaceutical Items listed on the PBS. Most of the listed medicines are dispensed by pharmacists, and used by patients at home.
The PBS is part of the Australian Government’s broader National Medicines Policy. The aim of the National Medicines Policy is to meet medication and related service needs, so that both optimal health outcomes and economic objectives are achieved. The central objectives of the National Medicines Policy are:
- timely access to the medicines that Australians need, at a cost individuals and the community can afford;
- medicines meeting appropriate standards of quality, safety and efficacy;
- quality use of medicines; and
- maintaining a responsible and viable medicines industry.
Continuing its close partnership with Australia’s medicines industry the Commonwealth periodically enters into five-year Strategic Agreements with the peak representative bodies of the medicines industry, Medicines Australia (MA) and the Generic and Biosimilar Medicines Association (GBMA). The Strategic Agreements formalise a partnership in the delivery of the National Medicines Policy and set out key government and industry commitments to certain PBS policy settings and reforms. The Agreements provide the medicines industry with certainty of the PBS pricing policies that will be in operation over the next five years.
The Commonwealth recently entered into new Strategic Agreements with MA and GBMA which commence on 1 July 2022. The new agreements contain a comprehensive package of reforms to ensure that Australians continue to gain access to break-through new medicines as early as possible and to deliver uninterrupted supply of medicines to Australian patients. The Commonwealth and the medicines industry have agreed to a Medicines Supply Security Guarantee to bolster medicine supply to Australian patients. Under this initiative, the Australian Government and the medicines industry will work in partnership to secure medicines supply to Australia to address the impact of an increasing number of global medicines shortages on Australian patients, pharmacists, and prescribers.
In 2019 and 2020, brands of over 500 Pharmaceutical Benefits Scheme (PBS) listed medicines had medium to critical impact shortages that impacted patient access in Australia. These medicines were predominantly commonly prescribed low-cost, multi-brand medicines that represent over one third of the total number of prescriptions subsidised through the PBS. They include antibiotics, medicines for mental health conditions, diabetes, heart disease, epilepsy, high cholesterol and severe pain.
The Medicines Supply Security Guarantee is intended to strengthen medicine supply to Australia and to ensure it meets the community expectations for uninterrupted access. The initiative aims to secure supply for off-patent, genericised medicines – which are the most prone to global shortages and represent the majority of prescriptions subsidised through the PBS.
In return for additional Government investment into medicines most at risk of shortages, Australian medicines manufacturers will be required to hold 4 to 6 months of stock of those medicines in Australia (‘minimum stockholding requirements’). This will provide Australians with an additional buffer when global medicines shortages occur, and provide additional time for the Government and the supply chain to prepare and respond to global shortages including through identifying alternative sources of supply (where possible).
Maintenance of stockholdings and use of the additional investment provided by the Commonwealth to manage supply chain risk, will become conditions for having multi-brand and other older medicines listed on the PBS. The Australian Government and industry have agreed that, where possible, the PBS should only use brands supplied by medicines manufacturers that employ business models to support long-term reliable supply.
The Australian Government will be working with the medicines industry to implement minimum stockholding requirements from 1 July 2023, and once in place will closely monitor that manufacturers meet these requirements. To assist the industry in implementing and maintaining minimum stockholding requirements, and to ensure compliance with legislative requirements, the Department of Health, in consultation with industry, will be developing stockholding guidelines.
The legislative requirements for the mandatory stockholding requirements are outlined under:
(a) Division 3CAA (Minimum stockholding requirements) of the National Health Amendment (Enhancing the Pharmaceutical Benefits Scheme) Act 2021;
(b) Division 3CA (Discounts and incentives) of the National Health Amendment (Enhancing the Pharmaceutical Benefits Scheme) Act 2021; and
(c) Division 3 (stockholding reporting requirements) of the National Health (Pharmaceutical Benefits) Amendment (2021 Measures No. 1) Regulations 2021.
The stockholding guidelines will be a Departmental policy document which are intended to:
(a) provide guidance to industry regarding how the minimum stockholding requirements will operate in practice;
(b) support industry in complying with the legislative and regulatory requirements;
(c) Provide guidance on the process for requesting that the Minister make a determination under section 99AEKC (2) that another stockholding quantity should be kept. The Minister may have regard to the guidelines when exercising their powers, but the guidelines will not prescribe or limit their powers.
The medicines industry will be required to report minimum stockholding requirement data, as prescribed in the Regulations, to the third-party Price Disclosure Data Administrator (through an online portal). Stockholding data will be reported every six months in line with when price disclosure (Division 3B of the Act) data is disclosed. The third-party data administrator will collate the data, undertake the required calculations and a provide stockholding compliance report to the Department every six months.
The Department is seeking Proposals for the provision of consultancy services to assist the Department in the following services:
(a) Consultation with key stakeholders (Medicines Australia, the Generic and Biosimilar Medicines Association, and individual pharmaceutical organisations) regarding the implementation of stockholding requirements under Division 3CAA of the Act and the content of stockholding guidelines;
(b) Development of stockholding guidelines.
The detailed specifications and requirements for the Services are set out at Schedule 1 - Statement of Requirement. The Department proposes to engage the successful Respondent to provide the Services in accordance with the Draft Contract set out in Schedule 6.
1. The Respondent and any proposed subcontractors must not be a Responsible Person.
2. The Respondent must not have had any judicial decisions against it (excluding decisions under appeal) relating to employee entitlements and have not paid the claim.
3. The Respondent, its personnel, and any Subcontractors proposed in the Tender must not, at the Closing Time, be listed as terrorists under section 15 of the Charter of the United Nations Act 1945 (Cth).
4. The Respondent (and any Subcontractor proposed in its Proposal) must not be named in the Consolidated list referred to in Regulation 40 the Charter of United Nations (Dealing with Assets) Regulations 2008 (Cth).
May 2022 – 30 November 2022