Pfizer and Novo Nordisk join calls for prevention framework as Australia lags behind peer nations

Despite overwhelming evidence supporting the value of prevention, governments remain reluctant to lead investment in long-term health strategies. Submissions from Medicines Australia, Pfizer, and Novo Nordisk strongly back the creation of a national framework to underpin sustained government investment in preventive health.

The Productivity Commission (PC) has flagged five priority reform areas, including a national framework to support government investment in prevention. These areas were shaped by more than 500 public contributions to ‘Australia’s Productivity Pitch’, which sought ideas on tackling productivity barriers and opportunities across the economy.

Australia’s commitment to prevention funding remains significantly below global benchmarks. Only 1.8% of the national health budget is allocated to prevention – far from the 5% target set in the National Preventive Health Strategy. By comparison, the United Kingdom invests 3.7%, Canada 6.9%, and New Zealand 7% of their health budgets in prevention.

“Government undervaluation of prevention interventions leads to underinvestment and delays, limiting the impact of evidence-based medicines and vaccines on the community, care and broader economy,” Medicines Australia said in its submission.

Among the most persistent barriers to progress is the short-term nature of political and budgetary cycles. Effective prevention programs often require substantial upfront investment and may take years to deliver measurable outcomes, typically beyond election cycles and budgetary reporting periods. This makes it difficult for politicians and decision-makers, under constant pressure to deliver immediate results, to justify funding for programs whose benefits may not be seen for years or fall outside their immediate portfolios or jurisdiction.

Meanwhile, delays in access to medicines and vaccines further undermine preventive efforts. It currently takes an average of 466 days for a new medicine to be PBS listed after TGA approval – and 1,375 days for a vaccine. Comparable countries provide access within as little as 90 days.

The pharma industry also makes the argument that the current discount rate of 5% diverges from international best practices and excludes many long term preventive health investments from consideration by Treasury analysts nationally and in jurisdictions. While Canada employs a rate of 1.5%, Japan utilises 2%, and both Germany and Singapore adhere to 3%. Scotland, the UK, and New Zealand employ a rate of 3.5%, whereas Ireland and France settle on 4%.

The value of prevention extends well beyond health outcomes. Preventive interventions generate wider benefits such as improved productivity, reduced caregiver burden, and better equity of access. Yet these advantages often fall outside current health economic frameworks.

“These broader, non-health benefits have no current qualitative value framework to be assessed and are either unable to be considered in a cost-effectiveness analysis or treated as only supplementary analysis,” added Medicines Australia in its submission.

The Health Technology Assessment (HTA) system has come under continued scrutiny for placing a lower value on human life than other government sectors and lower than international norms. For example, a quality-adjusted life year saved through vaccination is valued at approximately $15,000, compared to $200,000 for a life saved from a road fatality. This stark discrepancy suggests the Australian Government is far more willing to invest in road safety than in disease prevention through vaccination.

Pfizer’s submission draws attention to the missed economic opportunities in adult vaccination. Modelling has shown that for every dollar spent on vaccination in Australia, the economic return for government is 3.5 times. If the targets and focus of the childhood vaccination program were applied to adult vaccination, the economic return for government could be $1.1 billion net annually.

However, Australia’s adult vaccination rates remain lower than expected. The Grattan Institute found that just 27% of older Australians are up to date with their COVID-19 vaccination. Fewer than half of Australians in their 70s are vaccinated for shingles, and only one in five is vaccinated for pneumococcal disease.

Adult vaccinations significantly reduce hospitalisations, serious illness, and death. Avoiding preventable hospitalisations not only frees up hospital capacity but also strengthens workforce productivity by reducing illness-related absenteeism and early retirement due to ill-health.

Novo Nordisk’s submission draws attention to deeper structural challenges, particularly a health system still oriented toward acute care over prioritising long-term preventive care. Funding structures such as activity-based funding incentivise the treatment of sickness rather than the promotion of wellness. Shifting to an approach that emphasises prevention would require significant systemic reform, including changes to funding models and an expansion of multidisciplinary primary care services.

Obesity, described as Australia’s most pressing public health issue, exemplifies the need for preventive action. Today, 32% of Australian adults live with obesity, a figure projected to rise to 47% by 2035 without intervention. Obesity is associated with more than 200 complications, including its role as a leading risk factor in type 2 diabetes (55% of cases), cardiovascular disease (51%), and chronic kidney disease (42%). It now accounts for 8.4% of Australia’s total disease burden.

“First and foremost, increasing the current allocation to prevention funding is critical,” Novo Nordisk said in its submission. “Pivotal to all areas is improved coordination between federal, state, and local governments to streamline implementation efforts. Fragmentation has long hindered the scalability and effectiveness of prevention programs. Clearer allocation of responsibilities and joint funding models could address this issue while enabling sustained bipartisan commitment.”

The PC is expected to deliver the interim report in August, with final recommendations due to government in December following further consultation.

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