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Posts Tagged ‘Pharmac’

National’s $11.7 billion hole is right where they left it

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Remember Steven Joyce’s claim there was a “$11.7 billion hole” in Labour pre-election budget?

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The claim of an $11.7 “fiscal hole” became a dominating irritant throughout the election campaign, even though in large part it failed simply because no one else (except Bill English) agreed that it existed.  TV3’s “Newshub” even created this now-famous, handy, infograph to illustrate the fact that Joyce and English were effectively on  their own;

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The claim has been largely forgotten, except when the Left need a handy reminder of right-wing duplicity to throw at National/ACT trolls – just to wipe any smirk of entitlement  from their silver-spoon-fed faces.

Except, on Thursday, 23 November, there was a curious – and disturbing – juxtaposition of media stories in Fairfax’s Dominion Post;

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Joyce seems curiously very sure of himself on the existence of the “hole”;

“Unfortunately, sadly, I think it looks like over time I will be proven correct. I genuinely don’t take any joy out of that because actually all that says is that the new Government is going to spend more than it said to meet its promises, and that’s because it didn’t allow enough money for other things

[…]

Sadly I think we’ll get to the ($)11(b) over time.”

Where might this “hole” come from, if it exists?

One possible answer lay on the front page of the same edition on the Dompost;

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The report, by Fairfax journalist Rachel Thomas, revealed a massive shortfall in spending on medicines alone;

Cancer patients say they are sick of paying for their own survival after an independent report revealed a $682 million “hole” in government funding for lifesaving medicines.

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The $682m figure in Wednesday’s report from the New Zealand Institution for Economic Research (NZIER) is the amount it says would be needed to restore the community pharmaceuticals budget to 2007 levels.

In real terms, Budget spending for prescription medicines, vaccines, haemophilia treatments, nicotine replacement, and cancer medicines – sometimes administered in hospitals – dropped from 6.2 per cent in 2007 to 3.6 per cent in 2018, according to the report.

Now granted that Medicines New Zealand is a “drug lobby group” – but the NZIER which analysed the problem also revealed their methodology;

The NZIER report was commissioned by Medicines New Zealand, a drug lobby group, and collated from Pharmac annual reports and Official Information Act requests.

When former Health Minister, Jonathan Coleman, was asked to explain the massive $682 million hole in the medicines budget, his reply was;

Since 2007, almost 900,000 Kiwis had received 426 new and widened-access medicines. “It’s important to note that … Medicines NZ [has] a direct interest in increased Pharmac spending.”

Notice that Coleman – whose working relationship with DHBs has been frought over the last three years – deflected from the issue itself. His reference “to note that … Medicines NZ [has] a direct interest in increased Pharmac spending” fails to address the relevant fact that, according to NZIER, spending on medicines has fallen under the previous National government.

He deliberately evaded the question.

Which is hardly surprising given that English’s miraculous budget surpluses appear to have been made at the expense of  under-funding for services such as healthcare – including  mental health – throughout the country.

This poses some serious questions for the new Coalition government…

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from: Frank Macskasy <fmacskasy@gmail.com>
to: Dominion Post <letters@dompost.co.nz>
date: 26 November 2017
subject: Letter to the editor

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The editor
Dominion Post

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Let us recall that on 5 September, National’s then-Finance Minister and “Fix-It Man”, Steven Joyce, made a startling claim that Labour’s alternative budget concealed a $11.7 billion “hole”.

Joyce’s claim was scrutinised by economists, commentators, and even a right-wing think-tank and lobby group – and declared to be unsusubstantiated by any known facts. Only Joyce, supported by his leader Bill English, maintained the existence of a purported “hole”.

On 23 November, Fairfax reported findings by the NZIER that PHARMAC’s medicines budget was underfunded by a whopping $682 million. (“$682m ‘hole’ in medicine budget”). When asked to respond, former National Health Minister Coleman criticised those that commissioned the report – Medicines NZ, a pharmaceutical lobby group – but in no way disputed the figures.

In essence, PHARMAC’s funding budget suffered a savage cut from 6.2% in 2007 to 3.6% in 2018 – the equivalent of $682 million in vital medicines.

No wonder Joyce was so confident that a fiscal “hole” existed where none could see one.

Joyce knew precisely that the $11.7 billion “hole” was of National’s own making; a legacy “gifted” to the incoming Coalition government, and a ticking fiscal time bomb waiting to detonate as incoming Finance Minister, Grant Robertson, uncovered further hidden funding shocks.

What other “legacy gifts” has Joyce left us?

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-Frank Macskasy

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[address and phone number supplied]

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References

National Party:  Labour must explain where the money is

Mediaworks:  Economist consensus – there’s no $11.7b hole in Labour’s budget

Fairfax media:  Steven Joyce sticks to $11.7 billion hole in Government budget

Fairfax media:  Cancer patients renew call for more funded medicines, as report reveals $682m ‘hole’

Radio NZ:  ‘Extraordinary’ conflict between DHBs and health officials

Other Blogs

The Standard:  Health disasters – useless Coleman in all kinds of shit

Previous related blogposts

Weekend Revelations #1 – Dr Jonathan Coleman

Observations on the 2017 Election campaign thus far… (wha)

Dollars and sense – Joyce’s hypocrisy

St. Steven and the Holy Grail of Fiscal Responsibility

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This blogpost was first published on The Daily Blog on 28 November 2017.

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Public opposition grows against TPPA – Wellington

22 August 2015 5 comments

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NZ, Wellington, 15 August – In an otherwise grey, gloomy sky, much-heralded  rain made only a brief appearance with a few drops of moisture, as Wellingtonians and citizens from further afar congregated at Midland Park in the heart of the city. The first sign was held aloft on the footpath, just outside the park proper – an indication of what lay ahead;

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TPPA - trans pacific partnership agreement - protest march - wellington - 15 august 2015

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Some artistry adorning poster roundels;

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TPPA - trans pacific partnership agreement - protest march - wellington - 15 august 2015

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A damned good question posed on this placard;

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TPPA - trans pacific partnership agreement - protest march - wellington - 15 august 2015

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A wide variety of other placards awaited bearers;

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TPPA - trans pacific partnership agreement - protest march - wellington - 15 august 2015

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John Key has said that even if the medicines that Pharmac buys “cost a little bit more“, that government will pay for it and citizens will not have to pay a cent extra;

“If it did pay a little bit more, then the Government would fund that and New Zealanders would pay the same amount.”

Firstly – where does Key think the money comes from that Government would use to top up Pharmac’s drugs-bill in the event that the TPPA pushed up the costs of medication?  From the bloody tax-payer, you Tory Twat!

Secondly, having to pay for increased costs of medicines would mean that other areas of healthcare would inevitably  have their budgets cut.

And thirdly, Key is in no position to promise anything on keeping the cost of medicines down. His government has already  increased the cost of Pharmac medicines in 2012 from $3  to $5.

Who on Earth would trust Key not to do it again?

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TPPA - trans pacific partnership agreement - protest march - wellington - 15 august 2015

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The ‘Brass Razoo‘ band entertained the crowd, with “Uncle Scam” danced to the ominous sounding “Star Wars Imperial Theme“;

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TPPA - trans pacific partnership agreement - protest march - wellington - 15 august 2015

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New Zealanders voicing their concerns over the secrecy over the TPPA;

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TPPA - trans pacific partnership agreement - protest march - wellington - 15 august 2015

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If the deal is so good – why is the National Government keeping it secret from us? Negotiators from all participating counties know exactly what is in the texts. Only the public are not privy to the same information.

From a phrase that TPPA negotiator, Minister  Tim Groser, has been known to use;

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TPPA - trans pacific partnership agreement - protest march - wellington - 15 august 2015

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“Obama” being “arrested” by “pirates”, and charged with “treason”;

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TPPA - trans pacific partnership agreement - protest march - wellington - 15 august 2015

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The media was well represented, and both TV channels gave good coverage of the protests up and down the country;

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TPPA - trans pacific partnership agreement - protest march - wellington - 15 august 2015

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From younger to older generations;

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TPPA - trans pacific partnership agreement - protest march - wellington - 15 august 2015

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The Park quickly filled. Numbers swelled well beyond previous anti-TPPA protests;

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TPPA - trans pacific partnership agreement - protest march - wellington - 15 august 2015

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Marchers moved through Wellington’s CBD, growing in number along the way;

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TPPA - trans pacific partnership agreement - protest march - wellington - 15 august 2015

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Traffic came to a standstill, as the procession wound along the length of Lambton Quay, toward Parliament;

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TPPA - trans pacific partnership agreement - protest march - wellington - 15 august 2015

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Past the Cenotaph, where we commemorate fallen soldiers who made the ultimate sacrifice for our sovereignty;

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TPPA - trans pacific partnership agreement - protest march - wellington - 15 august 2015

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Once again, as with past protest marches,  the main gates to Parliament were firmly locked…

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TPPA - trans pacific partnership agreement - protest march - wellington - 15 august 2015

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… forcing thousands of citizens to squeeze through two narrow side gates. The contempt shown by those in ‘Authority’, to the New Zealand people exercising their lawful right to protest,  is unmistakeable.

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TPPA - trans pacific partnership agreement - protest march - wellington - 15 august 2015

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With young citizens leading the way…

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TPPA - trans pacific partnership agreement - protest march - wellington - 15 august 2015

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– the grounds rapidly filled with people;

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TPPA - trans pacific partnership agreement - protest march - wellington - 15 august 2015

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Numbers ranged from   Radio NZ’s 3,000 to Fairfax’s 5,000 in attendance. The northward view;

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TPPA - trans pacific partnership agreement - protest march - wellington - 15 august 2015

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The southward view;

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TPPA - trans pacific partnership agreement - protest march - wellington - 15 august 2015

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It was interesting (and refreshing) to  see the large numbers of families and young people present. This was not simply a turn-out of the usual, committed, anti-TPPA activists – these were citizens expressing their disquiet (and outright opposition) over a deal being negotiated in secret, and which would have far-reaching ramifications for our society.

Tangata Whenua showed their concerns at the secret TPPA deal-making that was going on in our name, behind closed doors;

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TPPA - trans pacific partnership agreement - protest march - wellington - 15 august 2015

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Secretary of the NZ Council of Trade Unions, Sam Huggard, explained why the TPPA would be bad for workers rights. He gave the example of trans-national corporations suing the Egyptian government for merely trying to implement a minimum wage;

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TPPA - trans pacific partnership agreement - protest march - wellington - 15 august 2015

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The big corporations, when they were cooking up this agreement in their high rises in Wall Street and Washington DC, and the politicians like John Key and Tim Groser who do their bidding, were hoping that the agreement would go through without this level of dissent.  We weren’t meant to have a say, that wasn’t in their model.
They weren’t counting on the health sector mobilising over access to medicines.  They didn’t want Maori mobilising to question how Treaty of Waitangi protections were being affected by this secret agreement.  They were hoping the tech sector wouldn’t get organised around the impact on copyright laws.   And they didn’t want to see unions critiquing the anti-worker provisions in the TPPA, like the Investor State Dispute Settlement (ISDS) provisions, provisions that were recently used against the government of Egypt – sued by French multinational Veolia Group in response to Egypt increasing the minimum wage.
None of this was part of the plan.  They wanted the agreement to go through quietly.  But we wont let that happen.

Gay Keating, from Doctors for Healthy Trade, explaining why the TPPA will harm healthcare in New Zealand;

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TPPA - trans pacific partnership agreement - protest march - wellington - 15 august 2015

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Someone did the sums that its going to cost a billion over ten years if they stretch out the costs for the length of patents.

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One of the things that’s pushed so many people in the health sector into being absolutely furious about this agreement is that is the wayit’s going to push people who are healthy, into sickness.

And it’s the processes which make it more difficult for countries to bring in controls on unhealthy products.

You’ve all heard about the $50 million pricetag that Australia’s facing in terms of Stage One of the fightback [by] the tobacco companies.

That’s what we’re signing up to in this agreement.

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The biggest health threat of our century and our children’s century and our moko’s century is climate change.

We need to be able to control greenhouse gases and we need not be handcuffed.

Our government must not be handcuffed for health.

Todd Rippon, from Actors Equity NZ, detailed how a previous “free trade” agreement had reduced the amount of locally produced drama on our television screens. He said the TPPA would be even worse;

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TPPA - trans pacific partnership agreement - protest march - wellington - 15 august 2015

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Performer’s lives are directly affected by trade policy. We have been hit hard with the blunt end of a big stick by that World Trade Organisation deal.

We know what it feels like to be cast aside to make way for extremely rich US corporations. I think you know what I’m talking about, yeah?

Signing the TPPA will not only make a bad situation worse for us performers, but it’ll make it worse for virtually every aspect our beautiful country.

Every aspect of our beautiful, tiny, vulnerable country.

Nothing will be untouched.

You name it; health, environment, education, Treaty obligations – no way. They will be wiped out in the name of international profiteering.

Don’t let that happen!

Documentary producer, Bryan Bruce, was well-received by the crowd and spoke well about the nature and problems of the TPPA. He condemned the potential eight to ten year extension of patents for medicines, saying that this would inevitably lead to people dying needlessly for want of treatment;

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TPPA - trans pacific partnership agreement - protest march - wellington - 15 august 2015

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What’s on the table is human misery. The poor have as much right to health as the rich.

Bryan  concluded with this warning for National if they went ahead and passed the TPPA;

We will not forget and we will not forgive them.

To  listen to Bryan’s thought-provoking speech, go to  Mick McCrohon’s video on Youtube.

Blues singer, Darren Watson and Delia Shanly on drums entertained the assembly with a rendition of  ‘Planet Key’. The  words were slightly amended to reflect on the issue-of-the-day. He also sang another of his original songs, ‘I Got Your Office Right Here‘, full of satire and good natured poking-fun-at-John Key.

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TPPA - trans pacific partnership agreement - protest march - wellington - 15 august 2015

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One lone female protestor managed to evade the barriers and Parliamentary security. She made her way to the top of the steps and sat down, adopting a peaceful meditating-position;

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TPPA - trans pacific partnership agreement - protest march - wellington - 15 august 2015

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Other protestors also jumped or skirted the barriers to dance on the Parliamentary forecourt, as Mick McCrohon’s video on Youtube  shows.

It should be pointed out that though protestors “breached the security cordon”, they did not – as the Police and Mainstream Media have reported – try to “storm the steps of Parliament”. That never happened. (In fact, if any mainstream media were present when this occurred, I did not witness their presence.)

A video-recording in my possession clearly shows young people rushing to the steps, and then sitting down on the first half dozen steps  – before police arrived to reinforce the half-dozen Parliamentary security guards standing over the protestors. The handful of protestors made no effort to “storm” the steps, as some have mistakenly claimed. They stopped and sat down before Police arrived (which my video also clearly shows).

See: Citizens face Police armed with tasers at Wellington TPPA protest march

Eventually, the protest ended and the good people of Wellington (and further afield) dispersed;

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TPPA - trans pacific partnership agreement - protest march - wellington - 15 august 2015

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As they arrived, they departed; in peace.

Let us hope that this National government has received the message they left.

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References

Parliament: Little, Andrew – Oral Questions — Questions to Ministers

Fairfax media: Prescription cost to rise to help pay for Budget

Parliament: 7. Trans-Pacific Partnership—Scope of Negotiations and Release of Information

Huffington Post: Corporate Courts – A Big Red Flag on ‘Trade’ Agreements

Youtube: TPPA PROTEST Wellington 15th.August 2015 Speaker Bryan Bruce

Youtube: TPPA Protest – Dancers Storm The Barricades At NZ Parliament Building

Acknowledgement

Appreciation to Mick McCrohons Youtube video’s, to complete this report.

Main Stream Media

Fairfax media: Thousands march against TPP trade agreement

NZ Herald: Thousands rally against TPP across New Zealand

Otago Daily Times: Thousands turn up to rally against TPP

RadioLive: Thousands urge govt. to ditch TPPA

Radio NZ: Thousands turn out to protest TPP

TV3 News: Thousands march against TPPA deal

TVNZ News: TPP protesters push through barriers at Parliament

Previous related blogposts

Roosting chickens

Citizen A – 29 Nov 2012 – TPPA Special

TPPA: Business launches propaganda campaign

TPPA: Doomsday scenarios, Critics, and flights of fancy

Open message to the Middle Classes about the threat of the TPPA

Nationwide Rally Against the TPPA – Day of Action!

They marched against the TPPA and the threat to our sovereignty (part tahi)

They marched against the TPPA and the threat to our sovereignty (part rua)

The Mendacities of Mr Key #5: Has Tim Groser shown the P.M. to be a liar on the TPPA?

Nationwide Day of Protest Captures Public Attention on TPPA

Opposing the TPPA – the Heavens hold their deluge ’till the People speak

Citizens face Police armed with tasers at Wellington TPPA protest march

Other blogs

No Right Turn: Help end TPP secrecy

Theocracidal: Thousands Protest TPPA, Cthulhu’s office minions hide under desks

The Standard: Groser – an arrogant git with a tin ear

The Standard: TPPA Protest review

Support groups

Facebook: Oil Free Wellington

Facebook: It’s Our Future – Kiwis concerned about the TPPA

Website:  It’s Our Future

Facebook: Aotearoa is Not for Sale

Action Stations: A Secret Trade Deal So Terrifying That Parliament Isn’t Even Allowed To Know What It Says

Facebook: TPPA Action Group – Wellington

OraTaiao New Zealand Climate and Health Council

Copyright (c) Notice

All images stamped ‘fmacskasy.wordpress.com’ are freely available to be used, with following provisos,

» Use must be for non-commercial purposes.
» Where purpose of use is commercial, a donation to Child Poverty Action Group is requested.
» At all times, images must be used only in context, and not to denigrate individuals or groups.
» Acknowledgement of source is requested.

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This blogpost was first published on The Daily Blog on 17 August 2015.

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To Annette King – we’ll hold you to that!

7 August 2015 1 comment

 

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Right up until last week, National’s ‘spin’ on the Trans Pacific Partnership Agreement (TPPA) was that it would not be permitted to impact on Pharmac or it’s ability to buy cheap, generic medicines.

Four years ago;

We have laid down the fundamentals of a position which says our public health system is not up for negotiation, not part of any trade negotiation, and I can’t conceive of any New Zealand government that would change that view.

Pharmac is an incredibly valuable institution that provides high quality medicines to many New Zealanders at very, very highly subsidised, reasonable prices. The fundamentals of that model are not up for negotiation. ” – Tim Groser, 16 November 2011

Three years ago;

If the Government agreed completely with the demands of American pharmaceutical companies, the negotiation would probably be over. It is not. It is a long, complex negotiation, and the New Zealand Government’s position is to preserve the role and effectiveness of Pharmac. ” – Bill English, 6 December 2012

Two years ago;

I think it’ll have a very marginal impact, at the end of the day.  It certainly won’t result in higher prices for pharmaceutical products for New Zealanders.  This is really about protecting the model of Pharmac to ensure that they’re in a tough negotiating position with international pharmaceutical companies, and we’ve got some very good negotiators who are doing just that. ” – Tim Groser, 

Last year;

There will be no fundamental change in Pharmac’s operations as a result of the trade agreement.”

You’ll have to wait to see the final agreement but any decisions we take in terms of trade-offs will protect the essential public health system of this country.” – Tim Groser, 22 October 2014

And this year, only a week ago;

“…yes, I can guarantee that we’ve made it absolutely clear that we are not going to dismantle the fundamental of Pharmac. The provisions that guarantee affordable medicines – we don’t want to change the system of health we’ve got in our country so that people can get medicines only if they can afford it. We’ve got a very good system, and we’re not going to let any trade agreement interfere with that.” – Tim Groser, 25 July 2015

Barely three days later, there was this startling admission from our esteemed Dear Leader, John Key,  that all was not quite so ‘rosy’ in the Land of Free Trade Deals;

That means the Government will have to pay for the original drug rather than the generic for a little bit longer. But for consumers that won’t make any difference because, you know, on subsidised drugs you pay $5 for your prescription so the Government may incur slightly more costs there.

Which vividly illustrates how, for the past four years, National has been lying to us, the New Zealand public.

It was only as TPPA negotiations drew to a close, that Key had to finally concede that there would be an impact on Pharmac and it’s ability to purchase low-cost generic medicines. The same TPPA will also impact on non-subsidised medicines purchased by New Zealanders, as not all attract subsidies by Pharmac.

On 29 July, Labour’s response was damning of the TPPA, and Health Spokesperson, Annette King stated matter-of factly;

Some people are going to pay with their lives because if they extend the patent, particularly on drugs for cancer and heart disease, and we can’t get access to the generic drugs for longer, then people are not going to get that access and they won’t have the opportunity to extend their lives.

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“Some people are going to pay with their lives.” - Labour's Health Spokesperson, Annette King

“Some people are going to pay with their lives.” – Labour’s Health Spokesperson, Annette King

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In which case, an incoming Labour Government has two options;

1. Raise taxes for those New Zealanders who voted National last year.

This is their responsibility, and should foot the bill for any increases to Pharmac’s purchasing budget. After all, National maintains itself as the “Party of Personal Responsibility“, so National voters should bear the costs of this mess; ie, ‘You voted for it, you pay for it’.

But since it is difficult to ascertain who voted for National last year, this option may not be practical.

2. Withdraw from the TPPA.

We simply cannot be party to an international trade agreement (or any other agreement for that matter) where “some people are going to pay with their lives”. That is simply untenable – especially for a Labourled government.

The seriousness of the TPPA’s effects on Pharmac (and non-subsidised medicines) is such that Labour must not be allowed to back-track on it’s criticisms, and has a duty to  withdraw from this appalling “trade” agreement.

If “some people are going to pay with their lives because … they extend the patent, particularly on drugs for cancer and heart disease”, then the TPPA must go. No New Zealander’s life is worth a “trade” agreement, no matter how much milk-powder we might sell overseas.

National ministers such as John Key, Tim Groser, Bill English, et al, have consistently, unashamedly, lied to us over the years. I do not expect Labour to follow in those footsteps.

This will be an issue I will be following, and I will be relentless in pursuing it, post-2017 (or earlier).

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TPPA action 8 august 2015

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Wednesday, August 12
at 12:00pm
New Zealand Parliament Buildings
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Friday, August 14
at 5:00pm
Palmerston North City Library
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Saturday, August 15
at 1:00pm
Midland Park, Lambton Quay
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Saturday, August 15
at 1:00pm
Napier
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Saturday, August 15
at 1:00pm
Timaru
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Saturday, August 15
at 11:00am
Kohukohu Village Green

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Saturday, August 15
at 1:00pm
School of Dentistry, Great King Street, Dunedin (near the Museum)
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References

Interest.co.nz: Pharmac fundamentals not on TPP table, Trade Minister Groser

Parliament: Hansards – 5. Trans-Pacific Partnership – Forecast Economic Benefits, Potential Effect on Pharmac, and Investor-State Dispute Provisions

Scoop media/TV1: Tim Groser adamant Trans-Pacific Partnership good for NZ

Radio NZ: Medicines ‘won’t cost more under TPP’

TV3: The Nation – Transcript – Trade Minister Tim Groser

Radio NZ:  TPP – Key admits medicine costs will rise

Radio NZ: Govt warned TPP could put lives at risk

National Party: About National

Previous related blogposts

Citizen A – 29 Nov 2012 – TPPA Special

TPPA: Business launches propaganda campaign

TPPA: Doomsday scenarios, Critics, and flights of fancy

Open message to the Middle Classes about the threat of the TPPA

Nationwide Rally Against the TPPA – Day of Action!

They marched against the TPPA and the threat to our sovereignty (part tahi)

They marched against the TPPA and the threat to our sovereignty (part rua)

The Mendacities of Mr Key #5: Has Tim Groser shown the P.M. to be a liar on the TPPA?

Nationwide Day of Protest Captures Public Attention on TPPA

Opposing the TPPA – the Heavens hold their deluge ’till the People speak

Letter to the editor – More reassurances from our esteemed Dear Leader?

Action

Facebook: Lunchtime rally against TPPA WELLINGTON

Facebook: It’s Our Future – Kiwis concerned about the TPPA

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Trust me fellow kiwis - John Key

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This blogpost was first published on The Daily Blog on 1 August 2015.

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Letter to the editor – More useless reassurances from our Dear Leader

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Frank Macskasy - letters to the editor - Frankly Speaking

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from: Frank Macskasy <fmacskasy@gmail.com>
to: NZ Herald <letters@herald.co.nz>
date: Wed, Jul 29, 2015
subject: Letter to the editor

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The editor
NZ Herald

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Admissions by our esteemed Prime Minister that the TPPA will impact on Pharmac’s ability to source cheap, generic medicines from overseas, are deeply troubling.

On 25 July, Trade Minister, Tim Groser, said;

“…yes, I can guarantee that we’ve made it absolutely clear that we are not going to dismantle the fundamental of Pharmac. The provisions that guarantee affordable medicines – we don’t want to change the system of health we’ve got in our country so that people can get medicines only if they can afford it. We’ve got a very good system, and we’re not going to let any trade agreement interfere with that.”

Three days later, Key conceded;

“That means the Government will have to pay for the original drug rather than the generic for a little bit longer. But for consumers that won’t make any difference because, you know, on subsidised drugs you pay $5 for your prescription so the Government may incur slightly more costs there.”

It is not the government that ” will have to pay for the original drug rather than the generic for a little bit longer”. That honour falls on the taxpayer.

Those extra costs may be reimbursed by the government – at the expense of other health services which will see their budgets slashed. National has a track record of shifting money around in the Health Budget.

Will National increase prescription charges again, as they did in 2013? Increasing prescription charges from $3 to $5 hit poor families the hardest.

The secretive nature of negotiations have proven that there was good reason to be suspicious of the TPPA.

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-Frank Macskasy

 

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[Address and phone numbr supplied]


 

References

Radio NZ:  TPP – Key admits medicine costs will rise

TV3: The Nation – Transcript – Trade Minister Tim Groser

Previous related blogposts

Children’s Health: not a high priority for Health Minister Tony Ryall

 


 

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Letter to the editor – More reassurances from our esteemed Dear Leader?

29 July 2015 3 comments

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Frank Macskasy - letters to the editor - Frankly Speaking

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from: Frank Macskasy <fmacskasy@gmail.com>
to: Listener <letters@listener.co.nz>
date: Wed, Jul 29, 2015
subject: Letter to the editor

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The Editor
The Listener

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Recent admission by our esteemed Prime Minister that the TPPA will likely see an increase in pharmaceutical costs for Pharmac is both disturbing but unsurprising. The secretive nature of the TPPA negotiations hinted at a “sting in the tail” that would impact on our healthcare.

On 25 July, Foreign Trade Minister, Tim Groser, promised hand on heart in an interview on ‘The Nation’;

“…yes, I can guarantee that we’ve made it absolutely clear that we are not going to dismantle the fundamental of Pharmac. The provisions that guarantee affordable medicines – we don’t want to change the system of health we’ve got in our country so that people can get medicines only if they can afford it. We’ve got a very good system, and we’re not going to let any trade agreement interfere with that.”

But only three days later, Key conceded;

“That means the Government will have to pay for the original drug rather than the generic for a little bit longer. But for consumers that won’t make any difference because, you know, on subsidised drugs you pay $5 for your prescription so the Government may incur slightly more costs there.”

Key’s assurances are questionable.

It should be pointed out that it is not Government that “will have to pay for the original drug rather than the generic for a little bit longer” – it is the taxpayer.

That extra cost for medicines will have to come from the Health Budget and one has to ask what will be cut back? Hip operations for the elderly? Grommets for children? Eye cataract surgery for the blind? National has a track record for shifting money from one area of healthcare to another, to appear as if funding has been “increased” for the lucky recipient.

Or will National simply increase prescription charges to cover increased pharmaceutical costs for Pharmac? National has already increased prescription charges from $3 to $5 in 2013 – a move that impacted on the sickest, poorest, and most vulnerable in this country.

Not for one moment do I accept Key’s assurances on this issue. He has gone back on his word before, and I expect him to do it again.

-Frank Macskasy

 

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[address and phone number supplied]


 

References

Radio NZ:  TPP – Key admits medicine costs will rise

TV3: The Nation – Transcript – Trade Minister Tim Groser

Previous related blogposts

Children’s Health: not a high priority for Health Minister Tony Ryall


 

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toby morris - tppa - cartoon

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Opposition parties work together on “orphan drugs” (part wha)

10 August 2013 2 comments
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Continued from: Opposition parties work together on “orphan drugs” (part toru)

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NZORD - seminar - 1 August 2013 - Wellington - pompe disease - manual cover

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NZ, Wellington, 1 August 2013 – A seminar in Wellington was held NZORD, the New Zealand Organisation for Rare Disorders , to discuss the problem of lack of funding for “orphan drugs”. People with rare diseases are missing out of medication – a life-threatening situation.

After a break for lunch, Wallace introduced the four members of Parliaments;

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nzord-seminar-1-august-2013-wellington

L-R: Barbara Stewart (NZ First), Kevin Hague (Green Party), Annette King (Labour) and Paul Hutchison (National) – Wallace Chapman (standing)

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Associate Minister for Health, Paul Hutchson, took the podium first;

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Minister Hutchison began by acknowledging his Parliamentary colleagues, Wallace Chapman, and John Forman.

Of John, Hutchison said this,

“May I acknowledge John Forman and the Organisation for Rare Diseases for all the the work that you do, John. Absolutely committed,  enthusuiastic, and assiduous. So please may I express that appreciation…”

The Minister continued by saying that he was sorry he was not present earlier in the day to hear the previous speakers. He then launched into his speech,

“… The principle of Universality does not mean that the public should pay for every test, treatment, or medicine, that improves health no matter the price of how effective it is. You may be aware that a new concept has crept in called proportionate universality, universalism, which in other words, is targetting. And it’s something that appears to be, ah, almost superceding the principle of universalism.

In his press release relating to the ombudsman, John Forman says the Ombudsman noted the contestable legal argument about whether PHARMAC appropriately excludes social and ethical factors from their consideration, though he said it was not his role to make a definitive decision on that legal dispute’.”

Minister Hutchison “forgot” to mention also that the same Ombudsman,  David McGee, had been highly critical of   PHARMAC’s  policy that “supported the position that high and low cost medicines should  be examined by the same decision-making criteria, and found that whilst it was lawful, was not reasonable“.

If Minister Hutchison had attended the earlier speaker’s addresses, he might have remembered to add that salient point. He continued,

“And John Forman also said that it is time for PHARMAC to acknowledge that a strict economic focus without a moral compass is abandoning patients at the margins. We hope that this opinion will cause PHARMAC, government ministers,  the health select committee, and other officials to respond with serious scrutiny and review of PHARMAC’s policies regarding socialised medicine for rare diseases. I don’t consider for one moment that PHARMAC acts without a moral compass… but  nothing should be for granted.

And I do note that PHARMAC’s key objective is  to  secure for eligible people in need of pharmaceuticals the best health  outcome that are reasonably achieved from pharmaceutical treatment and from within the amount of  funding  provided. I also highly respect the members of the Pharmaceutical Advisory Therapeutic Committee who are all dedicated clinicians who have committed their expertise to  attempt fairness and equity guided by a scientific evidence basis.”

I doubt if this next bit went down well with the audience,

“I must say I well remember Sir William [Bill] Birch telling me some years ago that from every nook and cranny, town and hamlet in New Zealand, comes a perfectly legitimate reason to spend money. The whole skill is how to prioritise it.”

If Minister Hutchison was invoking the ghost of Bill Birch, known for his extremist monetarist views, then he had come to the wrong place. This was not a Chamber of Commerce or NZ Initiative (formerly the NZ Business Roundtable ) business lunch. He was addressing desperate people who were seeking answers and solutions to life-threatening diseases – not hearing that the purse-strings were being closed by an acolyte of a past Finance Minister.

The Minister continued,

“And I guess that’s the blance and the tension that we have. Where do you achieve equity and fairness in comparison to the resources that we have available. New Zealand does indeed now-a-days spend amongst the top of  OECD countries in terms of it’s overall health budget. Some of you may say  that the pharmaceutical budget in comparison to the whole $14.7 billion is less than it should be although of course that is arguable.

So what’s PHARMACs position? As you know, PHARMAC pointed out there have been several reviews of the question of New Zealand providing subsidised access to high cost medicines.  Firstly in 2006, and then of course the McCormick report in 2009. They explicitly recommended against a separate high cost medicines funding [board?] approach for New Zealand. The reason they gave for this were that the main rationale for such a fund is to improve health outcomes rather than because of the particular charachteristics of the medicines themselves are a fundamental importance. The Panel noted that the PHARMAC model is already based on the objective of improving health outcomes. The panel was not convinced that the approach used by other countries such as Australia was superior to the status quo.

Government responded to a number of that reports recommendations and that led of course to the establishment of the  Named Patient Pharmaceutical Assessment scheme, which  we’re now  currently running with.

I also note  that most of PHARMAC’s funding is already committed to high cost medicines.  The PHARMAC annual review shows that the top 20% of patients account for … 86% of expenditure. That’s 20% of patients accounting for 86% of expenditure. Which means a smaller patient group is obtaining a greater share of pharmaceutical expenditure than the majority.”

“That’s 20% of patients accounting for 86% of expenditure.’ – is an interesting statistic. Is it code for implying that that a small group receive a disparate amount of tax-payer funded support?

How does that statistic compare  to the 10% of top income-earning families earning 30% of the income?  (see: Household Economic Survey 2010) Or the wealthiest 10% of New Zealand families controlling/owning  approximately  50-60% of  New Zealand’s wealth?  (see:  New Zealand Institute’s The Wealth of a Nation 2004)

Minister Hutchison concluded his speech,

“…I think it’s also important to point out that since the NPPA has come into being, that we’ve gone from where there was the previous regime which was $2.1 million and now  to $8 million. Clearly it’s not enough.There will always be pressure on it.

The last thing I just wanted to mention was that there is going to be  future reviews and right now PHARMAC is keen to look at new ways of serving  New Zealanders. That’s why  they are currently conducting their  significant review on operating policies and procedures. First thing under review includes the criteria by which PHARMAC makes it’s decisions. This  is an important opportunity to define what best… health outcomes means in terms of it’s  legislative objective,  and in doing so to change the mix of treatments that are ultimately funded  within the budget that is made available.

As you’re aware PHARMAC is  meeting communities around New Zealand in a series of  eleven forums and here is a superb opportunity for everyone here. I would put in a submission, attend the forums, and express your views.”

Wallace asked the Minister for his views on  creating a separate Rare Diseases Funding Agency, with a budget of around $25 million. Wallace explained that many people in the room were “falling through the gap” and a RDFA could plug that gap.

The Minister’s response was less than helpful, and defaulted to a predictable excuse not to consider the option. He said,

“…The issue is always once you get separate funding streams, you get extra bureacracy, you get an extra pressure on that funding stream as well as the main Schedule. So that it may be that you find you  have to take away from the main Schedule and vice versa. It’s a very difficult dilmemma. I think that this latest round of opportunities to relook at  how  PHARMAC  is setting it’s basic criteria of improving health outcomes is an opportunity to explore it.”

It is unclear as to why the Minister actually turned up to the seminar. His speech offered nothing new except, perhaps, to announce the  upcoming PHARMAC reviews.

If National is going to spring a herceptin-style change in policy toward sufferers of rare disease, the Minister was less than clear in his speech.  To use the Minister’s own words, he had expressed the status quo as policy and nothing more.

The real surprise was to come from the next speaker, Labour MP for Rongotai, Annette King;

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Ms King has served as Minister of Health in the previous Clark-led government and had over-seen the re-building of the health sector after the disastrous cuts to services and budgets in the late 1990s. Ms King put an end to user-pays within the public health system, implemented by the previous National government.

Ms King firstly acknowledged those with rare disorders who displayed “advocacy, tenacity, longevity, and your committment to fairness and equity in health.” Ms King added that, “I particularly want to thank John Forman, who has dedicated years to NZORD and if knighthoods actually went to the people who really deserved them, then John certainly would get one.

That suggestion  was received with  a loud round of applause.

Ms King continued,

“…I think the problem has really  reached a critical point because we have, as you heard from Dr Hutchison, there have been many reviews into this issue, going back to the 2007 New Zealand Medicines Strategy; the 2010 report on high cost, highly specialised medicines;  and as you know from that we still haven’t had this issue resolved for those who have very rare conditions. PHARMAC now, as we’ve already heard, have established what they call a new special pathway, their Named Patient Pharmaceutical Assessment, the NPPA, which follows the review of the exceptional circumstances. But by my reading of it, is that this policy runs counter to their current policy settings, because when you read it, they must take account of things like if a dollar is spent in one area, it is not available in another.

That they must work to obtain the greatest  benefit. That the best place  to invest  the next dollar, to achieve the best access to health. So these are the things that they have to take  account of, even in the NPPA policy. But at this point I do want to stress as John Forman has on a number of occassions, that I do support PHARMAC in their   role of getting the best possible deal for medicines of the bulk of  New Zealanders. I think they have done a fantastic  job over many years. In fact I think they’ve been a stand out organisation.

And the bottom line for Labour in  terms of  the Trans Pacific Partnership negotiations, the latest round of free trade aggreements,  is that PHARMAC continues to have the right to purchase our  pharmaceuticals  to get the best health outcomes from effective budget management.”

Then came the ‘crunch’ moment,

“…But I think there has to be, and we have to acknowledge, that what we have done in the past,  as you saw from the question that John just asked, there has to be a change in the way in the way we deal with orphan drugs.”

Ms King said that it was clear that the NPPA scheme was not working for people with rare disorders. PHARMAC was able to over-rule any recommendations to purchase drugs for patients with rare  disorders. Ms King then stated,

“It is time for us to separate the two issues…”

“In 2014 our election policy will have two main parts to it. First of all the establishment of an orphan drugs policy.That policy will include international information sharing and monitoring  of orphan drugs and sharing that information as others countries do, about the clinical viability and acceptability of those drugs.
The second, I believe, is very important, and that is the establishment  of a fund with it’s own Board. Now I don’t believe this has to be [as] highly bureacratric as Paul mentioned. I believe that you can set up a separate Agency within, for example the Ministry of Health,  to give it’s freedom, but it has it’s own Board. And it has it’s own fund to administer.”

“So one of the things that would need to happen soon after an election would be the establishment of on implementation working group, which could be made up of clinicians; of patients; of community representations, and others,  to put in place the details and work on the criteria for access. I do believe that in separating the funding and operation of the orphan drugs policy from PHARMAC. It will let them get on with doing what they do really well, and I think in some ways it will free them to get the best they can for the most of us who don’t need special medicines. But it will mean that for those who have rare disorders, that there will be a fund around that.’

Ms King said,

“We’d be looking at a fund between $20 to $25 million.”

Which is approximately what National spent on the Rugby World Cup in 2010 – $26 million of taxpayer’s money, on funding the tournament’s deficit. [Update: And on 8 August it was announced hat National would be giving a $30 million taxpayer’s subsidy to Tiwai Aluminium Smelter.)

“…That would be the way that we’d go in New Zealand, in line with other countries, including our closest neighbour Australia, who have managed a separate orphan drugs policy, for many, many years. And the advantage I suppose  from here is that we can learn from the mistakes from others, look at ways we can get the best value from such an agency.”

Ms King concluded that she believed this was a policy that other parties from the Opposition would support this new policy.

The audience responded enthusiastically to Annette’s announcement.

Wallace welcomed the Labour Party policy, and referring to  a Labour-Green-NZ first coalition, asked Barbara Stewart, “actually, which way will Winston go, Barbara?”

She smiled coyley, responding “we’ll just have to wait and see“.

That elicited  a mix of laughter and “awwwww” from the audience.

Next up, Wallace introduced Kevin Hague, from the Green Party,

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nzord-seminar-1-august-2013-wellington

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Kevin began with,

“Congratulations to Jenny [Jenny Noble – one of the seminar organisers] and to  “Sir John”… [laughter]

… And acknowledging my Parliamentary colleagues. Could I give a special acknowledgement to Paul Hutchison who’s gone now of course. National wasn’t going to have someone here. But Paul decided that that wasn’t ok, so he came along at short notice. So I didn’t agree with anything he said, but it was really great to have Paul here.”

Kevin expressed his regret at not attending the morning part of the seminar,

“Can I give you an apology for having missed this morning’s programme, as I thought it was a really exciting-looking programme. I intended to be here  for the entire time but I had to sit on the Select  Committee for the Pike River  Implementation Bill…”

Kevin continued,

“…My starting point actually is the right to life. Because that basic human right, it’s pretty universally acknowledged, seems to have embedded in it, the right to health.”

Kevin referred to the UN human rights treaties discussed earlier in the day. He said that for the right to life to be meaningful, it had to include the right to health. He acknowledged the high cost of medical treatments and the need to ration  those dollars. He said he “unashamedly” used the word “ration”.

“Governments decide whose needs will be met and whose will not be met.”

Kevin referred to “utilitarianism; the need to stretch health dollars for the greatest gain for the greatest number. It is only PHARMAC that tries to do that – the rest of the [public] health sector does not use this system.

While Kevin did not disagree with the concept of utilitarianism, he said that those whose health needs are furthest away, from the right to health,  will tend to be  those whose health needs are not met.

“And I don’t believe that that can be an acceptable consequence,” he added.

“So for that reason , we believe that the New Zealand health system needs to be able to have a second approach… Our approach is very congruent indeed with that you just heard outlined by Labour. I think  it’s very exciting indeed that Labour and ourselves have that same approach…”

Kevin said that whilst he believed that some of PHARMAC’s criteria for cost-benefits could be amended to take other criteria into consideration – such as participating in the workforce –  that he did not believe that the Agency should be bound by the “right to life” argument. Kevin preferred keeping PHARMAC’s “structures” as simple as possible, and keeping it’s cost-utility as straight forward as possible.

He would not “load” PHARMAC with the responsibility of resolving the orphan drugs and rare disorders  issues.

Kevin spoke to the PHARMAC representative in the audience and said,

“I would say just keep doing what you’re doing now, Stefan.”

Kevin then added,

“But. We are going to create another fund, which is specifically to be used on this right-to-health basis. I have no problem with  the cost effectiveness being one of the  criteria that is  used on the fund, but it’s  only one of a range of criteria. And I have no problem with PHARMAC’s people doing the analysis, but it can’t be PHARMAC that makes the decisions and I favour an independent Board very much as Annette outlined under Labour’s policy.”

Kevin said that even under two  systems there would still be inequities as there would always be a mis-match between dollars available and the need it has to try to cover. He said no system could be perfect in this regard.

“But using the two approaches actually reduces the size of that inequity, and that has to be a good thing.”

Kevin said “a great injustice has been committed” and the Greens would work to end that injustice.

Again, the audience responded with enthusiasm, obviously welcoming the Green position on the issue.

Wallace then introduced the last political speaker, New Zealand First’s spokesperson on Health, Barbara Stewart;

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Barbara began with a greeting and an apology for not being present for the first part of the seminar. She explained that the House was sitting under Urgency and extended hours. She congratulated John Forman for the “wonderful job he has been doing over the many years”, and thanked him for continuing to keep NZ First appraised of the issues surrounding rare disorders and orphan drugs. Without further preamble, Barbara launched into her policy speech. She got straight to the point;

“In NZ First, we believe that as a First World country, we should be able to afford access for orphan drugs. There is an underlying right to health  care. We are very aware that sufferers of rare diseases deserve fair treatment when it comes to access to orphan drugs. So we’ve been very pleased to hear what  Annette has announced. And I know that  Kevin thankfully  supports it, and I know that  we would in New Zealand First as well.

The last thing that want  to see is  people keeping on falling throught the gaps. The status quo needs changing. There is nothing surer than that. Particularly for orphan drugs. New Zealand was once thought of as one of  the highest  for the quality of  healthcare in the OECD. And it’s interesting to note that this ranking is slowly dropping away.”

Barbara said that many other countries ahead us on the OECD scale did indeed supply medicines for rare diseases. She said that NZ First has looked at the Australian model and “it appears to be successful“.

Barbara said,

“Here we would support Annette King with her model that she is proposing.” She added, “we don’t want to see New Zealand behind the rest of the world”.

Barbara acknowledged that PHARMAC has done a good job over the years, but that it was time “for a review”.

“We’re disappointed to see that the government, through PHARMAC , seems to be taking a relatively hard-line approach on medical funding and we know that this is putting people’s lives at risk… This is an issue that does need to be resolved.”

“So, we believe that equity and fairness is essential and whatever we can do to ensure that sufferers of rare diseases… can have access to the best treatment, we will do.”

Barbara concluded her speech with those words and Wallace thanked her.

NZORD director, John Forman then read out a statrement from the Maori Party. In it, they apologised for not being able to attend. Reading from the paper, he said,

“The Maori Party promotes the idea of a separate policy process for managing New Zealand’s supply of orphan drugs for rare disorders. We have a particular interest in  orphan drugs access policy through our support of people living with Pompe Disease, a  serious muscle wasting disease, that without treatment will result in respiratory and cardiac  failure. We understand the exceptional circumstances approach towards supporting applications for access to specialised and expensive medicines, such as enzyme replacement therapy, has yielded adverse impacts on too many individuals. And we cannot support any policy effect which results in government picking winners and losers.”

The Maori Party statement went on to state that there was an impact on  those suffering rare diseases by the inequitable decisions of this government. “There is a profound injustice at play”  that some families were impacted simply because of the rarity  of certain diseases and the consideration of appropriate treatment. The statement concluded by acknowledging the work done by organisations such as Muscular Dystrophy, the Lysosomal Diseases New Zealand, and New Zealand Organisation for Rare Disorders.

Wallace then opened the floor for questions.

In answer to a question as to when the Parties present would implement a separate Funding Agency, Kevin Hague replied, “in the first hundred days“.

Annette agreed with Kevin that it would be done “as soon as possible“. She gave a “solid committment that this would happen“.

This blogger then asked Barbara Stewart a question relating to her Party’s committment to a separate Funding Agency for orphan drugs. I confirmed that her Party would support a separate Funding model for orphan drugs, and she replied,

“We would support that, yes.”

I asked my follow-up question,

“…Here’s the problem. Is that, it’s  fine for you to sit there, saying you support it… but if your leader decides to go with National, it’s not going to happen, is it?”

To which Barbara replied,

“Oh, we have to wait until after the election before we can actually say anything at this point in time.”

Wallace suggested that Barbara txt-message Winston now to find out. She declined, and added,

“No, we do always say that will wait until the voters say what they’re going to say and then we work it through from there.”

The seminar continued with more questions and answers from the audience, including representatives from pharmaceutical companies and PHARMAC.

A talk was presented by Daniel Webby on his very personal experiences with living with a rare disorder.

John Forman presented his speech on issues and problems surrounding rare disorders and orphan drugs. His slide presentation finished with this image;

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A sobering conclusion to John’s speech, I thought.

My own conclusion from listening to the representatives from Labour, The Greens, NZ First, and the Maori Party, is that all profess to support a separate funding agency for orphan drugs.

But only Labour and the Greens can be counted on  to carry out their pledge.

New Zealand First states that it supports a separate Funding Model – but without knowing which way Winston Peters will move post-2014, then his Party’s policies must be viewed with uncertainty.

The Maori Party is in an even more untenable position on this issue.  Traditionally, they have viewed Labour with disdain, and instead chosen to coalesce with National. Unless the Maori Party makes a separate funding model for orphan drugs a bottom-line negotiating point – then their policy-pledge will go nowhere.

New Zealanders living with rare disorders, desperately seeking life-giving treatment, are experiencing stress, anxiety, fear, and an unnecessary interuption to their lives – on top of the effects of their disorders.

Yet, they have come far from their early days when they first approached PHARMAC for assistance, and were constantly knocked back. Those were dark days for people like John, Freda, Allyson, Daniel, Jenny, and many others.

But after this seminar, they found recognition for their efforts; understanding for their plight; and something else to bolster their spirits…

They found hope.

This blogpost was first published on The Daily Blog on 9 August 2013.

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Copyright (c)  Notice

All images are freely available to be used, with following provisos,

* Use must be for non-commercial purposes.
* Where purpose of  use is  commercial, a donation to NZ Organisation for Rare Disorders is requested.
* At all times, images must be used only in context, and not to denigrate individuals or groups.
* Acknowledgement of source is requested.

Previous related blogposts

Priorities? (19 Oct 2011)

Terminal disease sufferer appeals to John Key (12 Nov 2012)

Terminal disease sufferer appeals to John Key – Update & more questions (28 Nov 2012)

Health Minister circumvents law to fulfill 2008 election bribe? (18 Dec 2012)

Johnny’s Report Card – National Standards Assessment – Compassion (9 Jan 2013)

“There’s always an issue of money but we can find money for the right projects” – John Key (20 Jan 2013)

“One should judge a society by how it looks after the sick and vulnerable” – part tahi (4 March 2013)

“One should judge a society by how it looks after the sick and vulnerable” – part rua (4 March 2013)

“One should judge a society by how it looks after the sick and vulnerable” – part toru (4 March 2013)

Additional

NZORD

UN Special Rapporteur on Health

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Opposition parties work together on “orphan drugs” (part toru)

8 August 2013 3 comments
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Continued from: Opposition parties work together on “orphan drugs” (part rua)

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NZORD - seminar - 1 August 2013 - Wellington - pompe disease - manual cover

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NZ, Wellington, 1 August 2013 – A seminar in Wellington was held NZORD, the New Zealand Organisation for Rare Disorders , to discuss the problem of lack of funding for “orphan drugs”. People with rare diseases are missing out of medication – a life-threatening situation.

The seminar’s next guest was introduced; Dr Greg Coyle. Dr Coyle is a social policy analyst and manages the NZ Salvaton Army’s relationships with the Ministry of Social Development,  Housing NZ, Dept of Corrections, Ngai Tahu, Tainui, and Otago University. He is a member of the NZ Institute of Directors, Deputy Chair of Laura Fergusson Trust (Wgtn), and has a Ph.d. and Masters in Public Policy, in the area of fairness;

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[Taken from Greg’s speech notes] “This paper is about fairness and I am grateful to the New Zealand Organisation for Rare Disorders for the opportunity to present these ideas. I wish to talk about about three things. Firstly I will discuss one view of the anatomy of fairness. Secondly, using these ideas, I will examine how fairly PHARMAC has treated sufferers of rare and orphan diseases in relation to it’s wider statutory purpose. Finally I will propose a new funding mechanism for pharmaceuticals for sufferers of rare and orphan diseases which will, I believe, provide cost control and fairness to individuals and the wider community.”

“Fairness is something we each quite easily recognise when we see it, but have great difficulty describing it and agreeing on what it actually is.”

“Gauld described the Social Security Act 1938 as the political and legislative foundation for social welfare in New Zealand. This  social reform was based on a “fair go for all”. The legislation placed New Zealand’s concern for the least well off on a fairness platform.

In 2013, the fall-back position  is now commonly expressed as “well I accept something may be unfair, but who says the world is fair anyway?” as if fairness is now an unreachable and unnecessary attainment. Perfect fairness may well be unattainable, but acceptable levels of fairness in today’s political and social  landscape seems not to be universally accepted.” 

So the moral question here is how much fairness or how much equality is too much to aim for? How much is not enough? How much unfairness and inequality, in terms of state distributions, is our society prepared to tolerate?”

“Fair distributions to citizens are particularly difficult for OECD governments considering the increasing costs of public healthcare, especially pharmaceuticals. Again the question is not why we should ration  medicines, but rather how much rationing are we prepared to tolerate?”

“Hamilton describes this balancing act in terms of ensuring that there is minimal granting of special privileges to favoured individuals, and also ensuring the absence of social abandonment of those who require assistance. More particularly, what we are concerned about here is the process of micro-rationing  of pharmaceuticals to individuals.”

“[John] Rawls’ definition of fairness contends that, in liberal democratic societies, distributions should ensure each person has an equal right to the most extensive liberty compatible  with a similar liberty of others. Where social and economic distributions are to be unequal, they should be arranged so that distributions  are of the greatest benefit for the least advantaged… “

“This fairness principle leads decision-makers to ponder if their decisions would be considered fair by the most advantaged  people in society if, at an instant, they became  the most disadvantaged and required the distribution  for themselves […] This approach is not dissimilar to the maxim “do unto others as you would have them do unto you” which Blackburn contends can be found at the base of almost  every ethical tradition.”

Greg described the functions of PHARMAC, both on the national (meso) level and the individual (micro) level. He said that “sufferers of rare and iorphan diseases commonly fall into this [latter] category presenting in circumstances described as exceptional“.

He said that with regard to the Agency’s  national purchasing strayegies, “PHARMAC does an excellent job of consistently providing subsidy for an adequate range of quality pharmaceuticals” and “estimated that PHARMAC has saved approximately $1.17 billion over 14 years“.

Greg pointed out,

“PHARMAC takes excellent advantage of its market dominance, provided through an exemption from Part 2 of the NZ Commerce Act. The Agency employs aggressive monopsonistic  purchasing practices in negotiating contracts with international pharmaceutical companies.”

“In short PHARMAC is appreciated in New Zealand  as a world leader in meso-level rationing of subsidies on pharmaceuticals.  It provides for a good range of effective medicines to the community. It has done this consistently over 15 years and saved considerable amounts of taxpayer’s money  in doing so.

However, in PHARMAC’s second purpose of providing access to medicines for people whose needs are described as exceptional, the picture could not be more different. My research into the operation of PHARMAC’s ‘Exceptional Circumstances’ policy demonstrated  that PHARMAC does not closely align with high levels  of fairness to individual claimants, particularly sufferers of rare and orphan diseases […] it appears that PHARMAC does not provide subsidy equitably  for people with diseases requiring high cost medicines.”

Greg outlined how Ombudsman David McGee had assessed PHARMAC’s  policy that “supported the position that high and low cost medicines should be examined by the same decision-making criteria, and found that whilst it was lawful, was not reasonable“.

The Ombudsman stated that “… to attempt a specific recognition for rare diseases in the NPPA policy would significantly undermine the Pharmaceutical Schedule“.

Greg summed it up by stating  that “it would seem the two objectives cannot reside amicably in the same house“. He further stated,

“PHARMAC protects the inviolability of the CUA [cost utility analysis] process by not considering the personal circumstances of claimants despite the intention of the legislation to manage the claims of individuals in exceptional circumstances. Similarly, PHARMAC’s assessment of individual  claims takes no interest in the relative condition of claimants…”

He added,

“PHARMAC takes no regard of the needs of the least advantaged before the needs of the most advantaged and does not consider information from claimants about that which they have good reason to value in their lives.”

“PHARMAC also relies heavily  on opinions from it’s committees of  expert health economists. My research shows there was criticism of Quality Adjusted Life Years (QALY’s)  as the only economic assessment tool used in the efficiency study […] I am also aware that NZORD has complained that PHARMAC is choosey about which experts  it consults and has used experts that NZORD considers do not have international credentials to adjudicate on some claims by sufferers of rare and orphan diseases.

My research also demonstrated  the somewhat speculative nature of decision-making in that PHARMAC decision-making committees in the past have not recorded the reasons for decisions nor advised claimants under which criteria their applications have failed.”

Greg’s assessment of PHARMAC’s failings on this point  was explained that “underlying  this PHARMAC practice is a deep anxiety that, if claimants were provided with the reasons why their claims were denied, some would most certainly be challenged.

Greg then asked two questions,

“As a society do we believe that medical practitioners and economists are are qualified to make moral judgements about claimants and what they deserve?

Are medical practitioners and economists the right people to be putting  a price on what claimants have good reason to value in their lives?”

Greg pointed out the reasons why PHARMAC judged claims by individuals suffering rare and orphan diseases, calling threm all “excellent reasons“;

  • If PHARMAC accepted all claims, it would exceed it’s budget and fail it’s statutory duties,
  • PHARMAC had to resist unproven/untested therapies, especially so-called “alternative style health providers who cruelly offer desperate people ‘cures’ which are most often hopeless”,
  • PHARMAC faced pressure from pharmaceutical companies to list their own drugs on the Agency’s Pharmaceutical Schedule. These pressures had to be “contained”.
  • And PHARMAC had to demonstrate that it had a robust national-level “rationing”policy to maintain the confidence of Parliament, DHBs, and the public.

“In summary, PHARMAC celebrates the fact that it applies the same meso-level rationing  tools for micro-level decisions. In assessing the pharmaceutical  needs of sufferers of rare and orphan diseases, the tools are simply not fit for the purpose.”

We Need a Fairer System

Greg acknowledged the unfairness of expecting PHARMAC to manage the Pharmaceutical Schedule with a capped budget as well as having to consider expensive and essentially unaffordable claims for medicines. He said that “this situation had created the animosity and on-going frustration between sufferers of rare and orphan diseases and PHARMAC staff and Board“.

He also said it was “equally unfair of rare and orphan diseases to be denied medicines which will improve their life expectancy [simply] because they are being assessed against an economic metric which applies to a model based on 4 million people“.

Greg said that a fairer system had to be devised. One that ensured that PHARMAC was unencumbered in it’s primary role of nationwide rationing, involving the subsidisation of a wide range of pharmaceuticals for New Zealand. This was a role that PHARMAC did very well.

Greg then offered a solution;

“But we also need a micro-level rationaing system with a different set of rationing criteria more suited to the task of analysing claims of individuals and small groups of sufferers of rare and orphan diseases. The fund would be, let’s call it, the ‘Rare Diseases Funding Agency’ (RDFA). It would have  a Board appointed by the Minister of Health and administered by the Ministry of Health. The Fund should be regularly reviewed and reported to the Minister.

The RDFA will need to carefull consider both relative economic efficiency and locate the best relevant expert advice it can muster. It would make sense for PHARMAC to undertake the CUAs when required on behalf of the new Agency.  The decision making criteria will also need to develop a level of understanding the quotient of fairness and be aligned with community values  in support of micro-rationing…

[…]

… I am in no doubt that the RDFA will from time to time be required to make unpopular decisions. On such occasions the Agency will suffer the same level of criticism and unpopularity as has been visited on PHARMAC. However under such circumstances claimants seeking a review should be able to expect a fair hearing of their circumstances and be advised of the reasons for the decision made.

[…]

The Rare Diseases Fundaing Agency that I have described follows the international  precedents set by Australia, England and soon in Scotland.”

Greg concluded with this salient point,

“I doubt that there will be a day when the Rare Diseases Funding Agency would be able to fund individuals and small groups of people for every treatment available. Under our current funding system, this day will never come. However, the new agency will have fairness and community values among its founding principles. It may not [be] able to provide perfect fairness, but New Zealand would have a system which travels purposefully in that direction and sufferers of rare and orphan diseases would be better off than they are now.”

[Note: a full text of Greg’s presention can be found here: Funding Pharmaceutical treatment for Rare Diseases in New Zealand; we need a fairer way of doing things– Greg’s speech is highly relevant for our wider society as he touches upon issues relating to social equality; individual rights;  and a fairer distribution of resources. My report only briefly touches  on Greg’s main points; his full speech is rich in ideas and information. – Frank Macskasy]

At the conclusion of Greg’s address, which was warmly received by the audience, Wallace invited all speakers to take seats up-front and engage in a question and answer session;

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nzord-seminar-1-august-2013-wellington

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This was followed by guests from the four main political parties represented in Parliament; National, Labour, The Greens, and New Zealand First. (The Maori Party sent an apology along with a policy statement.)

There was to be a surprise policy announcement from one of the parties.

To be concluded at:  Opposition parties work together on “orphan drugs” (part wha)

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Copyright (c)  Notice

All images are freely available to be used, with following provisos,

* Use must be for non-commercial purposes.
* Where purpose of  use is  commercial, a donation to NZ Organisation for Rare Disorders is requested.
* At all times, images must be used only in context, and not to denigrate individuals or groups.
* Acknowledgement of source is requested.

Previous related blogposts

Priorities? (19 Oct 2011)

Terminal disease sufferer appeals to John Key (12 Nov 2012)

Terminal disease sufferer appeals to John Key – Update & more questions (28 Nov 2012)

Health Minister circumvents law to fulfill 2008 election bribe? (18 Dec 2012)

Johnny’s Report Card – National Standards Assessment – Compassion (9 Jan 2013)

“There’s always an issue of money but we can find money for the right projects” – John Key (20 Jan 2013)

“One should judge a society by how it looks after the sick and vulnerable” – part tahi (4 March 2013)

“One should judge a society by how it looks after the sick and vulnerable” – part rua (4 March 2013)

“One should judge a society by how it looks after the sick and vulnerable” – part toru (4 March 2013)

Additional

NZORD

UN Special Rapporteur on Health

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