PBS Spending - Investment not cost: Pharmaceutical MD
Figures released by the Australian Bureau of Statistics pointing to a contraction in spending on the Pharmaceutical Benefits Scheme (PBS) fly in the face of accepted mantra. Speaking at the ALP's business forum today, Wyeth Pharmaceuticals Managing Director, Erica Mann, said the latest quarterly figures for government spending on the PBS show an average growth of 2.63%, less than the inflation rate of 3% .
"We are constantly being told that the cost of the PBS is unsustainable," Ms Mann said.
"Yet, figures for the September quarter show a six-fold drop in spending growth compared to the same time last year. Budget Estimates show that growth in PBS spending over the next few years will be below average. Australia's per capita expenditure on pharmaceuticals is below that of many OECD countries . On these figures, it is a complete fallacy to insinuate that the growth of the PBS is out of control.
"It is essential that our health care system is financially viable but financial viability should not be calculated in isolation from the long-term savings. In 2002 Professor Frank Lichtenberg reported that that expenditure on newer, improved technologies can lead to cost savings on hospital stays, doctors' bills, and home healthcare expenditure, seven times more than the cost of the treatment. About two-thirds of these savings result from reduced hospital costs.
Ms Mann said medicines allow millions of Australians to live longer, better and more productive lives.
"Medicines reduce the burden on our already strained hospital system and enable people to continue working and making a positive contribution to the economy. More importantly healthcare is an investment not a cost," she said.
"The challenges posed by an ageing population and increasing budgetary pressures are such that we need to position the PBS not just as an investment in the health and wellbeing of individuals, but as an investment in Australia's future economic and social capital."
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2. Department of Commerce 2004 Pharmaceutical Price Controls in OECD Countries: Implications for US Consumers, Research and Development, and Innovation, International Trade Administration: Washington, p.15.
