New Zealand ups funding for subsidized drugs over TPP ratification period

The New Zealand government is upping funding for its drugs procurement agency amid claims that medicine costs will rise under the controversial 12-nation Trans-Pacific Partnership trade agreement.

An extra 39 million NZ dollars (26.87 million U.S. dollars) would be invested in the 2016-2017 year to enable Pharmac to provide New Zealanders with access to new medicines, Health Minister Jonathan Coleman said in a statement Wednesday.

The funding boost, which would extend to an extra 124 million NZ dollars (85.43 million U.S. dollars) over four years, would bring Pharmac's annual budget to a record 850 million NZ dollars (585.65 million U.S. dollars), said Coleman.

Around 3.5 million New Zealanders received a subsidized medicine in the 2014-2015 financial year, up 100,000 from the previous year.

"The government's extra investment gives Pharmac more options on new medicines it can fund. It's up to Pharmac to make these decisions," he said.

Prime Minister John Key said in a newsletter that the extra money would allow Pharmac to consult on funding new treatments across a wide range of health areas, including for advanced melanoma, hepatitis C and brain tumors.

"Many of the drugs to treat these illnesses are cutting-edge and extremely expensive, which puts them out of reach of most New Zealanders unless they are publicly funded," said Key.

However, the opposition Green Party called on the government to immediately release Pharmac's advice about the true level of funding needed to meet increased cost pressures, including the TPP which is expected to come into effect in about two years.

The TPP would push up pharmaceutical costs for Pharmac by extending drug patents and it was unlikely the funding increase would not be enough to cover the extra costs, Green Party health spokesperson Kevin Hague said in a statement.

"Many new medicines, while appearing to offer substantial new benefits, seem to come at a much higher price tag, and the movement towards more individually tailored medicines will be more expensive still," said Hague.

"Pharmac has been desperately short of funds for many years now, so while this funding increase is long overdue we still don't know whether this will be sufficient to meet the health needs of New Zealanders."

Key, who has previously said the government would meet any cost increases incurred by the TPP, said in a speech Tuesday that "potentially far-reaching proposals to do with Pharmac and intellectual property that were raised earlier in the negotiations were not included in the final (TPP) deal," but gave no details.