How does the operation of PHARMAC's 'Community Exceptional ...

towards New Zealand and for them to be justified in withdrawing their co-
operation with the New Zealand government.
The greater concern expressed in the RMI’s submission was that PHARMAC
would be restricted in access to newer medicines which would provide more
effective treatments to New Zealand citizens. These situations defeat the
objectives of the Bill which sets out to promote the best care for New
Zealanders through the publicly funded DHBs.
PHARMAC submitted in rebuttal that it cannot and does not control the access
to the pharmaceutical market. Any company wishing to sell pharmaceuticals in
New Zealand can do so to any willing buyer, so long as the products meet the
normal regulatory standards of safety and quality as determined by Medsafe 29 .
Many companies choose to launch and promote their pharmaceuticals in New
Zealand without a PHARMAC subsidy. PHARMAC sees this as a form of
competition and pointed out to the Committee that it sought to limit the number
of competitors it dealt with, but did not seek to limit competition in the wider
market place.
The RMI counter argued that the wide exemption to the Commerce Act also
defeated the price control and anti-competitive free market principles enshrined
in the Commerce Act. These principles are applicable to all other industries and
companies operating in New Zealand. These principles are regarded by the
government as protections for consumers in respect of quality and prices. The
RMI’s submission argued strongly that the Commerce Act is there to promote
active, workable and effective competition which, in turn produces efficient
economic and healthy outcomes.
These outcomes are described as prices close to cost, efficient production and
product innovation, all which advance the health and welfare interests of the
consumer/citizen (PB/18 The Researched Medicines Industry Association of
New Zealand, 2000). The benefits of competition and the protection of the
Commerce Act not only apply to consumers but also to suppliers and in the
case of pharmaceuticals and ultimately to tax payers.
29 Medsafe is a department of the Ministry of Health and is the regulatory body with approves by registration the safe use
of medicines and medical products which can be sold in New Zealand. The Medsafe website is
http://www.medsafe.govt.nz/
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