Source: Radio New Zealand
New Zealand has seen 30 years of underinvestment in the medicines budget, says Medicines NZ. File photo. 123RF
More than four million New Zealanders are missing out on modern medicines languishing on Pharmac’s drug wish list.
A new report commissioned by Medicines New Zealand – a group representing the pharmaceutical industry – has shown hefty delays in funding medicines.
It found that 137 modern medicines have spent an average of six and half years on Pharmac’s ‘Options for Investment’ list – the drug buying agency’s top priority medicines list.
The report said 83 percent of those medicines are standard-of-care drugs in other countries, meaning they are the go-to treatments.
Medicines New Zealand is calling for ongoing material increases to the drug budget, so Aotearoa can catch up.
Chief executive Graeme Jarvis told Checkpoint it was the result of 30 years of under-investment in the medicines budget.
“We invest about a third of what the rest of the OECD does in their medicines budgets in terms of the publicly funded medicines budgets. So we’ve really got to look at a long-term corrective action that needs to be taken to try and get us towards that OECD average.”
From gathering publicly available information, including information from Pharmac, Jarvis said it will cost about $328 million to clear the priority medicines list.
“We think a step change approach should be looked at, and it’s really the year-on-year increases that we’re going to need to do.”
Jarvis said it would only take about one percent of Vote Health – the primary funding mechanism for the country’s public health system – to clear the list.
“At the moment, Pharmac’s getting about 4.9 percent of the vote health. So moving it to 6 percent of vote health, would actually see you in one year clearing that OFI list.
“Then you can start dealing with some of the other newer medicines that are coming through that have yet to be ranked as well.”
That would mean around an increase of $50-$100 million year-on-year to start moving towards the OECD average.
Jarvis said funding would potentially have to be reshuffled from other areas to cover the cost.
“Governments do this all the time and they move money around and, you know, internally within budgets or vote health would be in this case.
“The other option is that they have got operational allowance still available, despite what’s going on with the recent announcement around the potential relief. So there might be the potential to put $50 million in this year and then look at doing something next year as well – there is existing funding that is available for that.”
The drugs on the list covered a wide range of different conditions.
“Cancer drugs, there are rare disorder drugs, there are neurology drugs for mental health, epilepsy, chronic diseases like diabetes as well, heart failure drugs.”
Jarvis said that without the medicines, these diseases were having a massive material impact on the rest of the health system.
“So we’re ending up with essentially, unfortunately, our hospitals being literally the ambulance at the bottom of the cliff.
“It is well established that medicines can actually keep people in a primary health setting through GPs and community and away from what is the expensive end of town, which is really into the into the hospitals.”
While the cost to fund all the medicines may sound high, Jarvis said any medicine that had made the list was on there for a reasonable price.
“The medicines that are on these priority lists, there has been health technology assessment done. They’ve been found to be very cost effective and therefore they are value for money.”
Many of the drugs on the list were up to 15 years old.
“We’re talking often about products that are generics, you know all genericized, so they’re quite old, they’re not what we would call new medicines.
“Other countries that are poorer than us are very happy to fund these medicines because they see they are valued for money.”
Health Minister Simeon Brown’s office said he was not in a position to comment on funding as discussions were sensitive ahead of Budget Day.
He pointed to a record $604 million investment in Pharmac in 2024.
The minister said that money covered 33 new cancer medicines and 33 treatments for other conditions. But he said there was more to do to expand access to life saving and life extending medicines.
The Minister responsible for Pharmac David Seymour acknowledged that funding of medicines still took too long.
While Pharmac was achieving better outcomes for patients and increasing access, he said there was room for improvement.
He said when Pharmac was given the money it needed, it acted quickly.
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– Published by EveningReport.nz and AsiaPacificReport.nz, see: MIL OSI in partnership with Radio New Zealand
LiveNews: https://nz.mil-osi.com/2026/03/25/dozens-of-modern-medicines-languish-on-pharmacs-drug-wish-list-for-years/