Drug Spending Up Despite Pharmac's Efforts

The amount New Zealand spends on pharmaceuticals keeps increasing in spite of the efforts of the Government's drug-subsidy agency Pharmac, Health Minister Bill English said today.

"Pharmac was criticised last week by the Health Select Committee for its aggressive stance against the drug companies. However, I have no doubt that our drug bill would be even higher without Pharmac's hard line approach.

"The taxpayer now spends $700 million a year on pharmaceuticals, which is an increase of $100 million since Pharmac was set up. Pharmaceutical expenditure is growing at an average rate of 6 percent a year, which is still far higher than the 1.3 percent spending growth caused by demographic changes.

"We can't afford to sit back and relax with spending increases like this. Protecting the taxpayers' interests is just as important as protecting the rights of the drug companies.

"It is disappointing that Pharmac has to budget so much for legal fees, but these are outweighed by the savings it is able to make on behalf of the taxpayer and I am pleased with the work it is doing," said Mr English.