Submission to Pharmac on Beta-interferon for Multiple Sclerosis

NZORD Submission to Pharmac on Funding Arrangements for Beta-Interferon for Multiple Sclerosis - February 2002

1. This submission from NZORD addresses the current issue of the cap on funding of beta-interferon for MS, in the wider context of the implications such rationing mechanisms have for all rare diseases, and access to pharmaceutical therapies for them.

2. We make limited comment on the entry and exit criteria as we note that these items are subject to further consideration by your specialist committees. However we think that many of the issues we raise in this submission may be of relevance, as appropriate, to the entry and exit criteria, as well as to broader funding/rationing decisions.

3. PHARMAC's published comments in its Operating Policies and Procedures about its obligations under public law (1.2.3) are relevant to this submission, and most of our comments are directed to those issues. Of particular relevance is the recent expiry of the exemption under the Human Rights Act, for Government and Government agencies. We think this has a significant impact on the decision-making framework that PHARMAC must apply.

4. In particular, we submit that a decision to cap the total number of MS patients eligible for treatment, is no longer justifiable under the law as it will now apply, with the Government exemption now explicitly removed. Such an approach is likely to offend against obligations under the International Covenant on Economic, Social and Cultural Rights to provide the "highest attainable standard of … health", and against other international obligations New Zealand has signed up to.

5. The "cap" also appears to now be in breach of the Human Rights Act in that it will discriminate both on the grounds of disability generally, and more specifically the type of physical illness, and presence in the body of organisms capable of causing illness.

6. This approach to rationing of expenditure, especially when seen in the context of the removal of the exemption, also seems in conflict with PHARMAC's primary legislative objective to "secure for eligible people in need of pharmaceuticals, the best health outcomes that are reasonably achievable from pharmaceutical treatment and from within the amount of funding provided".

7. We submit that such discrimination will not meet the Bill of Rights standard of a "reasonable limit justified in a free and democratic society", as recently outlined to District Health Boards by the Ministry of Health. (Changes to the Human Rights Act 1993 and implications for the Health and Disability Sector - Letter from MOH - 21 November 2001). The Ministry makes particular note of case law that refers to "whether the distinction which exists is based on the personal characteristics of the individual or group and has the effect of imposing burdens, obligations, or disadvantages on that individual or group which are not imposed on others", and the criteria for deciding if this distinction is justified.

8. The important role of PHARMAC in managing the total budget for drugs must be tempered with concepts of equity and distributive justice. Such criteria are implied by the international obligations, the Bill of Rights standard referred to by the Ministry, and by PHARMAC's own references to equity, public law and fair process. However, the limited reference to such criteria in the Operating Policies and Procedures is of concern.

9. It seems inescapable to us that an arbitrary limit for one group of patients based solely on financial considerations, is not acceptable when there are no equivalent limits placed on a wide range of other pharmaceuticals for other groups of patients. This is especially so when the benefit to patients with MS, for example, by objective measure are much greater than for many other unrestricted subsidised pharmaceutical applications - subsidy for drug treatment of minor or moderate pain as an extreme comparative example.

10. We submit that PHARMAC's function to maintain and manage a schedule that applies consistently throughout New Zealand, should be read broadly to include consistency between groups, as well as consistency geographically. Caps on certain drugs but not others are not a consistent application of the schedule.

11. We do not argue for unlimited subsidy of all possible treatments. Issues of availability, suitability, clinical benefits and risks, are valid considerations for access to all treatments. We support reasonable limits according to good clinical criteria, including safety, efficacy and supply, and we accept the need for a carefully managed approach to the total budget.

12. But we do not consider it acceptable to ration one drug by simple administrative means when the resulting "cap" seems to be in conflict with international obligations, the Bill of Rights standard, the Human Rights Act itself, the objective clinical indications, and principles of equitable access to subsidies by different patient groups. Given trends in Court interpretation of Public Law issues, we would have some confidence that the Court would be inclined to our thinking on these matters.


We submit that the "cap" on subsidies for beta-interferon treatment for MS should be lifted because it is no longer appropriate (if it ever was) for PHARMAC to apply such a control on access to this treatment.

We urge PHARMAC to consider these same issues for other "capped" drug budgets and act to lift those numerical/financial controls too.

John Forman
Executive Director