HTA failure forces more pharma companies to pull innovative therapies from Australian market

As patients call for “no more reviews or rhetoric” on stalled Health Technology Assessment (HTA) reform, Australia is once again facing the reality of pharmaceutical companies walking away from launching innovative therapies due to barriers in the HTA and pricing processes.

Pfizer has confirmed that its therapy for severe atopic dermatitis, Cibinqo (abrocitinib), will not be included on the Pharmaceutical Benefits Scheme (PBS) despite a positive recommendation from the Pharmaceutical Benefits Advisory Committee (PBAC) in November 2024.

“Pfizer believes there is a still significant growth to come in the atopic dermatitis market. We expect usage will exceed the expenditure thresholds set in the remaining years of the Risk Share Arrangement (RSA), and that the RSA does not reflect a true sharing of risk due to the way it is structured.

“Overlaying this RSA with the already low net pricing expected for listing, we believe the average selling price for Cibinqo does not reflect the value of innovation and is commercially unsustainable,” Pfizer ANZ said in a statement.

Cibinqo would have been the third PBS-listed therapy for severe atopic dermatitis, a condition that causes debilitating pruritus, often leading to insomnia and significant impairments for patients and carers alike.

The challenge is not unique to Pfizer. Over the past decade, net spending on the PBS has slipped from 14% to 12% of total health expenditure. Of all new medicines launched globally in the same period, only 24% are subsidised for Australian patients. The RSA framework, designed to manage costs, is increasingly seen as a barrier to access, limiting availability of therapies that patients elsewhere can receive sooner.

Meanwhile, international drug pricing policies are compounding pressures. Prime Minister Anthony Albanese is set to finally meet with President Donald Trump on 20 October as part of broader US trade negotiations, with medicines policy firmly on the agenda.

Mark Butler MP, Minister for Health, Ageing and Disability, has acknowledged that the proposed Most-Favoured-Nation pricing policy will have far-reaching consequences, with Australia among the countries likely to feel the impact. He has flagged the need to prepare for these implications while stressing that Australia must remain “an attractive market for those companies sending new medicines to Australia”.

Yet, our nation risks slipping further down the global access ladder. While pushing back against US tariffs on exported Australian branded and patented medicines, Medicines Australia’s sharper warning was aimed at the looming threat of the Most Favoured Nation pricing.

“From an Australian perspective we are more concerned with the Most Favoured Nation reference pricing benchmark proposal as Australian prices are already very low, compared to comparable countries. This is already impacting Australian patients access to new innovative treatment options – with decisions being made to slow new products launching in Australia which will exacerbate the delays to listing on the PBS,” stated Liz de Somer, CEO of Medicines Australia.

Pfizer echoed the sentiment, saying “Australia must urgently create more flexible, patient-focused reimbursement that balances economic considerations with patient needs. Pfizer Australia joins industry, patients and healthcare professionals in calling for reform to Australia’s HTA to ensure patients can access the latest treatments when they need them.”

While the company considers private market availability for Cibinqo, the reality is that out-of-pocket costs will push the treatment beyond reach for most Australians, exposing a system where access to innovative medicines depends on the size of a patient’s wallet.

De Somer reinforced the call for meaningful action. She said, “We need to see greater investment in the PBS to reverse the decades long decline in investment. For the patient community, their families and healthcare professionals, there is no time to wait. We started this [HTA] process several years ago and we must now work quickly towards actions and implementation.”

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