The 'Dispatched' Week in Review'- 15 May

There are enough measures and signals in this week's Budget to suggest medicines, vaccines and other technologies were discussed extensively in the process leading up to Tuesday's announcement. It might also help explain Health Minister Mark Butler's annoyance at one organisation's response. A Government response to a parliamentary inquiry triggered another odd response from stakeholder groups. 

Transcript

Paul 0:08

Hello and welcome to the Dispatch Podcast Week in Review. My name is Paul Cross, my co-host, Felicity McNeil, PSM, Chair of Better Access Australia, amongst other things. Hi Felicity.

Felicity 0:18

Hi, Paul. Budget week is over. Well, that's over for today and then we start again next week.

Paul 0:25

Yes. What a week.

Felicity 0:29

Yep.

Paul 0:30

Well it didn't quite go as predicted, but couldn't really have predicted what happened.

Felicity 0:37

Which bit?

Paul 0:38

Well, I could we could predict that there was going to be nothing in the budget about reform because the minister said that in March.

Felicity 0:45

Oh sorry, we're we've gone straight to PBS. Okay.

Paul 0:49

Well, obviously there was a lot of tax changes.

Felicity 0:52

There was. There's a lot of tax. There's a lot of um I I think some commentators have been quite right. Healthy so far down the pecking order already in this budget, uh, compared to aged care and the NGIS, uh, which then also compares to the broader fiscal work that is going over over with respect to tax reform. So it's quite a challenging time. And I think those that actually got something in the budget and then perhaps didn't acknowledge it correctly in a budget that largely didn't talk about health uh as a comparison to the the presence it normally has. Yeah, it was interesting.

Paul 1:29

Yeah, wasn't there wasn't much in there. Uh extended funding for the urgent care clinics, which the RACGP welcomed, go figure. Uh I'm just trying to wonder how the pharmacy guild would respond to a similar announcement. Uh Straits of Hormoose situation, I think. But look, let's just let's just get right to it.

Felicity 1:51

Let's get to where you want to get to, yeah.

Paul 1:52

Yeah, I I want to talk about the minister's reaction to the comments issued by Medicines Australia. I I've I want to talk, I want to talk, I want to start by talking before we get into the substance of that, and I've been very critical of it, and I I believe he had every right to be very cranky. For a start, the industry has walked with the minister side by side, step by step along this pathway since the process was announced. It was uh May 2022 when Greg Hunt, as one of his last decisions as minister, attempted to appoint Peter Vauxhall to chair the HTA Review Reference Committee. Medicines Australia accepted that. Mark Butler intervened after his appointment and reversed that termination. He established the reference committee and accepted Medicines Australia's nomination to it. Someone who didn't even live in Australia. What is it? There's something about this association and getting people who don't live in Australia to help them.

Felicity 3:00

It goes really well, Mug from experience. Wells it goes really well for people still sitting in the city.

Paul 3:06

We'll get to that down the track at some point. Uh that person, very esteemed industry leader, retired industry leader, had uh decided didn't want to do it after a couple of months. Mark Butler accepted that, accepted the new nomination from Medicines Australia and appointed them to the reference committee. The association participated in that process, was part of the report that described the system as world-class. Uh some very minor dissent, but not significant. In the report that delivered 50 some odd recommendations. Uh he announced the release of that review final report, and that he was going to establish an implementation advisory group to work with the government on prioritizing and planning the implementation of the recommendations. Industry cheered that. Literally, I was at the event and they cheered.

Felicity 4:02

I think that covered at least three podcasts.

Paul 4:04

Yes. Uh so obviously industry was represented on the implementation advisory group. He received that final report from the implementation advisory group and decided that his initial response announced last September in Parliament House was to do a review of a review, essentially. So he's going to review the PVAC submission guidelines on the technical inputs prioritised by the industry, that is, comparators and the discount rate. And he's also added in the definitions around high unmet medical need and high added therapeutic value. The industry welcomed that announcement. And now having heard the minister say in March that he's not doing anything in this budget on this review, he didn't say it explicitly, but anyone who understands governmental and ministerial language knew that that's what he was saying. He said, I will get an update from the department on this process, this review of the review, mid-year. So the budget essentially reflected what he'd previously said. So the industry has been a collaborator in this process from day one, a process that you and I have challenged from day one, knowing it would end up here. And they dropped a bomb on him with their response to the budget that also included misleading information about the forecast pharmaceutical spend. Clearly misleading. Clearly misleading. So he had every right to go to that breakfast and say WTF. WTF. And I'll let you respond to that, but then I do want to get to the fact that people have no idea. No idea what he has been dealing with in cabinet. We can speculate, but you don't know. But what we got from him on Tuesday was either I'm gonna manage these guys and force them to the table. Or I'm really angry because you've got no idea what I've been dealing with.

Felicity 6:08

Could be both.

Paul 6:09

Yeah, it could be both, yes.

Felicity 6:12

Um look, it's it's curious. There's been a number of things, and the way people respond to stuff is in a budget. And I know we're gonna talk about some other sectors as well, too. I I I'm continually beguiled by it. I have for a long time hoped that the innovative sector would actually take a stand and argue about what is needed for patients. And if you are actually going to take a stand and get engaged in a process, you better have your facts right before you do. Because that was bad. I'm struggling not only because of that, but then it led to that chain of events when you're at an event the following day and you are the butt of all the jokes. So at least when uh 60-day dispensing was uh given as a a a budget surprise for the guild, no one laughed at them, everyone ignored them, no one laughed at them. But in fact, people were gloating for a short period of time, but with respect, people are laughing, and that is the thing that really concerns me. You you can see that the game is on, and the upside for the minister having read the budget papers and seeing where the triangulation of uh the future of the PBS and the MBS assessment processes, by the way. So we we need to be very careful about that. You could see what was coming, you could see the strategy both within government uh and specifically of the minister, and then you can see the effective lines that have been drawn, and it's it's like being in the high school play yard because in listening to the way that the GBMA handled this, it's like game on. Which one of us is going to get to be best is with the minister, and right now we're winning.

Paul 8:24

Well, all of the budget documents for anyone who's who's familiar with budget documents obviously there was a lot of conversation about the PBS in the butt in the budget process.

Felicity 8:39

Well yeah.

Paul 8:40

Obviously. And and this goes to my point is that let's just wind back in history. When when the industry decided to put the stronger PBS bus shelter in the Prime Minister's electorate, the minister didn't really care. Now that could be because it was it looked like government campaign, but he could have been really upset at that. That's the Prime Minister you you're you're targeting. He didn't really he didn't really wasn't perturbed at that. I do understand he said to someone, I thought you wanted this review. I don't understand. Haven't I given you what you wanted? And you have to understand that you don't know. You don't know the the uh the idea that some people appear to have the idea that the minister sits in his office up in Parliament House and says, Oh, you know what, I think I'm just gonna obfuscate on HDA now. I'm not gonna worry too much about it. It doesn't work like that. The minister has to get the authority of his colleagues, the Prime Minister or at least all his colleagues. I don't know how this government works in terms of Prime Ministerial, Prime Ministerial authorities overriding cabinet, but but he has to go to cabinet. And you don't know that he hasn't been there. You don't know that he didn't take the HTA review to cabinet and was told, come back when you've got some savings. You don't know that that didn't happen. You don't know that it didn't happen earlier this year, late last year, one year ago, or two years ago. We simply don't know. You see, we don't know that he hasn't he hasn't fought off some serious assaults, attempted assaults on the PBS. This government has not done anything on the PBS in terms of savings for four years. It's pretty staggering. And so I just think, as I say, you've got to treat this moment like it's a grenade with the pin pulled out. Great care is required. Because to me, yes, uh obviously went into Tuesday morning and spent most of yesterday pretty happy with himself. He went into Tuesday morning saying, obviously they didn't listen to me in March.

Felicity 10:45

Oh sorry, I think you mean Wednesday.

Paul 10:47

Oh sorry, Wednesday morning. Obviously, yes, Wednesday morning. Obviously they didn't listen to my speech in March. I was too subtle. And I did say to someone in his office that I think he may have been a bit too subtle. So I'm gonna get rid of the subtlety, which is obviously why Medicines Australia has so much so much difficulty editing his comments. Because you see in the edited video that they put online, he g he gotta goes up to it and then it gets stopped. Let me tell you, give you some home truths, is basically what he says.

Felicity 11:19

Yeah, I I also have a broader issue with that one, which is again when you you gotta get the basics right. He's the minister for health, disability, and aging. When you put out a video and say he's the minister for health and aging, what is the biggest thing he is tackling at this moment? It's actually the NGIS. And to actually put something out where you don't even recognise his full title, and I don't mean to be pedantic, but I actually am, because it goes to the symptom of understanding what is his priorities, the workload he has. Of course, his stuff's gone to through the cabinet process and more specifically, expenditure review committee. First of all, he sits on the expenditure review committee. Second of all, every fact sheet that is released as associated with the budget has to be cleared through Treasury, which means it has to be based on something that is already within the papers at some point or has been agreed to. So the fact that a fact sheet, not the portfolio budget statement, not the budget papers, but a fact sheet talked about uh initiating biosimilars for basically treatment naive, that's cleared. It's in the budget. So for something to be there randomly in a fact sheet and not in any other parts of the portfolio statements, and we can talk about how increasingly useless they are to tell you what's going on in a portfolio, but there's a lot that has happened in there. There is a lot in there, there is a reason. Every descriptor in BP2 has been cleared through Treasury and Finance. So when something says, by the way, this includes an extra$738 million, which reflects pricing changes, um, that's because, yeah, in 2027, the price cuts that are currently in place expire. And so therefore, that's also one of the benefits. One of the benefits we worked towards in the 2015 negotiations was to make those price cuts time limited so you can reclaim the saving when you initiate a new policy. Because if you keep something in it's an embedded, for example, price disclosure, every change is an estimates variation. So when we look at the things that are talked about in the budget papers, whether it's BP1 or BP2, there is a lot in there that tells you how much the PBS was discussed.

SPEAKER_02 13:35

Yes.

Felicity 13:36

And you know, you and your pro pro mark week this week, which is.

Paul 13:41

Oh no, I'm I'm really grumpy about it.

Felicity 13:44

No, can I just say something? People have been saying that, and I think no, but that's the thing that you and I will often say. Like I said to you, I often beat the minister up with a two by four, but I'm the first to send him a letter and say thank you.

SPEAKER_02 13:54

Yeah.

Felicity 13:54

And you're the same if it's the right thing or the wrong thing. Like I knew in 2015 that I was finally doing something right, because when the person who chastised me for four years in his articles finally said, Hey, I think the department's onto something here, I'm like, wow, if the person who normally holds me to account says, Guys, what are you doing? And I'm sure the minister probably did what I did, which was go, I'm gonna frame that one.

Paul 14:15

Well, I I just don't get the sudden urgency. You but you've been there every step of the way. I mean, I I think they they've obviously pushed these things together, and he said that at the breakfast. Oh, I mean, can I just say when the minister agrees on the morning of the first day after the budget, the first thing he does is he comes to speak to you as a stakeholder. He's not coming to say good things, he's just not. He's coming to deliver a message, and that message I think was framed by something we don't know. Obviously, the PBS featured in the process, and we don't know what he's been told. We don't know that he didn't go and try and get some HTA reform. We don't but we simply don't know, right? And so I just no, I think we have to respect you've got to treat this process, understanding that it's a tip of the iceberg situation. You only see what's above the surface. There's no way, there is no world in which the minister goes to that thing on Wednesday and says, Oh, you know, I tried to get something, but I got rolled by my colleagues. It doesn't happen like that.

Felicity 15:28

Yeah, and and look, and I hear you, and I think it's an important perspective or an important lens to look at this process with and to to potentially understand why he's frustrated or angry um at the way the um industry responded with their press release. The basics are if you if you've got it wrong, you've got it wrong. So, you know, in a week where you've announced that we've already funded six billion basically of new listings. Now I admit they're all ones that have been previously announced, but we gave you six billion. We gave you the two million to implement the Costal Hoverie impacts for you know PBAC and again, everybody, MSAC. Let's let's really pay attention to that. Uh and we have all sorts of other things in the budget, like we've got the biosimilars. It's very clear that something has gone on. We'd had the earlier thing, like he'd said at the FIN review, which he'd said that's a process that's going to come through. We've watched the way this has moved and edged towards um 1 July, which is when officially the gun goes off and everyone can officially start to negotiate. But we've watched the review of um the supply, you know, shortage of supply measures. We've watched the reviews of the definitions of high unmet clinical need and high added therapeutic value and the concerns that were raised with that. There's a great irony. Two weeks ago, that was an issue, and it was one that genuinely the industry had a right to say, Whoa, where's this all going? What are we doing? You know, and and how are patients are being included and and who are you choosing to help? That was legitimate. What happens when you put out something that is factually uh inaccurate is that that can make you annoyed too. But I guess I'm saying that you've spent a long time in government, I've spent a long time in government. Of course, these things were discussed in this most recent budget process. Of course, as we've always seen from the strategic agreement, they were going to link if you want change, it comes to the next round of pricing.

Paul 17:24

We've been saying it for how many years?

Felicity 17:25

Yeah, I know. Five. Yeah, five years. And here it comes. So you know that's all had to have been a conversation. I mean, you only have to read the portfolio budget statement in relation to the Department of Veterans Affairs, and you know that the PBS was discussed. So, you know, the government will achieve savings over four years from 2026-2027, from new and amended listings to the RPBS as recommended by the Repatriation Benefits Reference Committee. Now, people it's all in there. Yeah.

Paul 17:58

So I just it's a it's a very frustrating thing for me because uh I I've got no idea what happened in the budget process. I can guess, and we can point to some pointers in the budget papers based on our experience, and your experience with those budget papers is a lot better than mine. But I also have a lot of experience of dealing with ministers coming back from ERC meetings or out of cabinet meetings. And these are these are these are really challenging processes, they are personally challenging. So, as part of that budget process, who's to say the minister didn't say to his colleagues, it's good. I got this. I can get agreement from these guys, they'll be fine. They've been with us all of the way. Look at all the stuff they've said, they've supported us every step of the way on this process, and I can get them to the table. And then he sees that press release. This is a minister who obviously has a high confidence of his colleagues, and he will protect that very, very assertively and proactively. This press release uh it makes him look bad to his colleagues. That's that's the challenge, if it in any way contradicts what he's been telling them. The stuff that was just wrong in there about the future forecast is just silly, it should never have been in there. I was warning them not to put it in there. Obviously, they don't listen to what I say, they put it in there anyway. It's arrogant and it was false. And the minister had every single right to say, I'm sorry, that is completely misleading. Now, in terms of where to now, you've got to stick that pin back in the grenade as quickly as you can. And that means uh getting your head around the fact that the negotiation isn't about the start in a few weeks. The minister's speech to you on Wednesday morning was the starting gun to that negotiation. He framed that negotiation. I want this done by September. You say you want HTA reform done quickly. Well, let's get it done quickly. Let's get it done so it can be in my EFO. By the way, this is always how this goes. You knew, you knew that. You knew that it's how it went under the former minister and how it went under the predecessor of the former minister. You know how it goes. These things are these things are connected. Me personally, do I think a public health system or improvements to a public health system should be contingent on a stakeholder agreeing to savings? No, but I don't think changing the wording of a couple of technical inputs is improving a public health system, which is the other crazy thing about the urgency. So so which part of these reforms do you think are going to be make lead to these major generational changes? Which which ones exactly? And so that is it, that is another frustrating point for me. There are any number of reasons to criticize the minister on the HTA review. It has been delayed so long now, I'm convinced the next thing is they're going to consult an astrologer, you know, to see you know in which vector or sector the sun is rising or something, you know, Sagittarius, you know, whatever. But but you have been supportive of every single step in this process. You've been actively involved in it. To wash your hands of it now and demand sudden change when he told you two months before the budget it wasn't going to happen. Stop not listening. Just because you might be sloppy with your language doesn't mean he is.

Felicity 21:24

Oh no, he's very specific.

Paul 21:25

He is very specific. Now it's not too late. Go back and read his speech to the AFR Healthcare Summit, where he says, Our ambition, not our commitment, our ambition is to accelerate the process for the therapies that we consider high value. It was our plan is definitely to think about doing something for something. One medicine a year. Yeah, the unicorns that come along once once a year. Read that and understand what he's saying. Now, the reality is that if, and I said this with the submission pathways, whenever however many years that you know, however many the 2018. 2018, so before the coalition government actually won a final term. That's how long ago it is. I said, if you prioritize some things, by definition, you deprioritize others. And that's what they're gonna do. So there are any number of reasons to criticize. You've got to the sort of statement that was released on Tuesday night is the sort of thing you've got to work up to that. So two years ago, what they and I was we were saying this at the time, you've got to have an exit strategy here. You've got to have a drop the hammer strategy, but you can't just do it out of the blue. This to me, the the irony of all this, of course, is that what is the industry, the research-based sector, really sensitive about is 2015.

Felicity 22:53

Yeah.

Paul 22:54

That has had this enduring impact on how they engage government. But to me, what happened this week is strikingly similar and reflects all the same, is symptomatic of all the issues. They don't understand the role of a minister and the fact that the minister does not sit at their desk and just say, well, I'm gonna do this now and I'm gonna do that. It doesn't work like that.

Felicity 23:19

No, it doesn't. And I know you wanted to talk about this more generally. In expenditure review committee and the broader discussions that go on, there are three other agencies that actually get to put forward ideas, initiate ideas. And that is the Department of the Prime Minister and Cabinet, the Department of the Treasury, and the scariest of all Scarecrow to the Department of Finance. And so what people don't understand is that it isn't just about the process with ERC where I bring forward my portfolio budget submission or my l my initial list, my bucket list in my IFO, and then they go through that and say you can't have the first 50, you can have these 12 and work them up and fully cost them. It's not just that. Then as the system, because those three agencies, Troika, look at the the whole of the general government sector, not just your portfolio and not just your program. So when they come through and they're trying to work out how does the entire budget balance and where does an initiatives come from, it is quite often that they are putting forward ideas and reforms with respect to your programs, your portfolio. And what can be quite terrifying for individual agencies and for some ministers is that if there can be often many people in finance who have longevity and experience in your portfolio that dwarfs you. So they know and they kept really good records. And so they know which measures have been tried and tested, which ones have been done, things reappear. Once something has appeared once, it will appear over and over and over again. So you to give respect to the ideas that you were putting forward, which is maybe he's annoyed because he's had to sort of do a bit of wheeling and dealing on the PBS, there is a high probability, given that everybody knows that the price cuts are coming out, that this year was the year that the likes of finance it. And here are the kind of things that we're expecting. These are measures that you could put forward right now that would actually deliver X, Y, and Z savings. And if we reflect back to the 60-day dispensing and what a train wreck that was for the government, because a very newly elected government took advice from certain areas of the bureaucracy that she'll be right, mate, and she wasn't. And not only is it a poorly executed policy because GPs don't do it properly, it doesn't actually make money for GPs, you didn't do it in negotiation with the guilders. We've always said, if you want to have that policy discussion, you should have that up front with the people who will A make it happen, but B are the small businesses. But not only did we see poor implementation, which of course leads to reduced savings, which means they have to then be found from elsewhere in the portfolio. You also saw a future uh uh community pharmacy agreement where significant extra money was actually put into the pharmacy sector, well beyond the anticipated savings. So not only did they not achieve their savings, they also then had to compensate for the way that they had executed the policy so poorly. And that is why, if I think about the concerns that maybe have been expressed and the misrepresentation by Medicines Australia about what was in the budget or not in the budget could cause a minister frustration because that don't start this stuff again.

Paul 26:56

Yes, it's uh as I say, there are you you you know highlight the RPPBS changes, the explicit reference to consulting on potentially making biosimals the default. We all know consulting means informing. So that decision's obviously been taken. The change in the forecast based on pricing assumptions, it's all through the document. We know in the IGB, and I've said this time blue in the face, people just don't seem engaged in it. What did they say in the IGB? Again, they sent the signal. We are working with the finance department on developing ways to capture future statutory price reductions. So when they're working on RPBS changes, when they're looking at the assumptions around pricing, when they're looking at bi-similar changes, it's not the only things they've been working on. They've been working on all of these other things. This is the other problem. Is that when they have their first meeting in these negoti you know, these negotiations, when the rubber hits the road, and the minister kind of removes himself, and officials step in and take over, you're not gonna be working off a blank whiteboard. The department are gonna come in and say, This is the starting point. This is the starting point. So I really hope, I really hope that the industry is working on some credible ideas, some really credible ideas to counter what's going to be presented to them because things will be presented to them, and they'll already be worked up, costed. And again, I say it again, you just don't know what has happened, and you can't know because no minister in history ever admits or rarely ever even discusses with anyone that process and what happens, and so just be really, really careful. So, my frustration this week was that if you want to challenge the minister on HTA reform and broader PBS things, you can do that, you can absolutely do that. The problem is you've got no foundation on which to do it because you've been with him every step of the way and praising him, and now all of a sudden we get this overwhelming sense of urgency. And I'm and I and some of the posts on LinkedIn, and not just by the industry, were just credibility shredders.

Felicity 29:26

Yeah.

Paul 29:29

What I was at that Farm Oz event in September when he announced the review of the review, and I was the only one who burst out laughing.

Felicity 29:38

I remember hearing about it.

Paul 29:40

Yeah, I literally burst out laughing. Everyone else, it was like one of those North Korean stand-in ovations for Kim Jong-un, or the ones that Fidel Castro used to get for 90 minutes. I'm not going to be the first person to be seen not clapping. It's just ridiculous. So all of your actions, everything you have done, and I I I I include some patience in this, everything you have done has led the minister to believe, understandably, that his approach to this review is exactly what you want. You have talked about comparators and discount rates for five years, and so he has fairly assumed that that's the priority. And so to have it go at him now, after you've been with him so closely, and he's pretty much done everything you asked, I just I just find it. If I was in his office, like let me tell you politicians take things really personally. I go back to the old days, the 2002 budget, the then APMA, now Medicines Australia, in their budget submissions called for an increase in patient co-payments. So so what was in the budget? An increase in patient co-payments. And guess what they did? They came out and opposed it that night. The then CEO of the APMA, now Medicines Australia, stood up at the press gallery and to camera said, we oppose this. But it was in your submission. I can remember speaking to him. Yeah, but it's too much. Okay, okay. Peter Costello, the then treasurer, kept that media release in his top drawer for the rest of his term as treasurer.

Felicity 31:26

Yeah.

Paul 31:28

They take they are human. They take things very, very personally. You have supported me, and he is it is fair for him to say you have supported me at every step of this process. Every step of this process, and now you do this without having any idea of what we've gone through in this budget process. So you pull the pin out of the grenade at the worst possible time. When your one friend around that cabinet table, you probably your one friend, the one who has to stick up for you and represent your interests, has navigated goodness knows what processes and challenges and you do this to him. He's got every right to be very annoyed.

Felicity 32:21

Yeah, like I said, I I don't see it as as personally as that, but I just feel that if you're going to So for me, as a patient, what would I have liked? I'm I'm not concerned about the HTA review because I don't think it's actually going to achieve much for me and never has and never will.

Paul 32:40

What allowing companies to include 3.5% along with their 5% discount rate analysis? It's not going to change everything.

Felicity 32:50

But but let's take it one step back for a moment. That if if you did want to make a point about this, it's really great. Like I said, the fact that they still don't understand the forward estimates. I I can't help with that. Someday you will. But you can welcome six billion in new listings over the last six months and say that's really great. And we don't dispute for one minute that there is bipartisan support to list recommendations of the committee. It's a rare gift. What we're arguing about here is the time it's taking from the moment that recommendation comes from the PBAC to when we actually see it in action. And that is the narrative. That is actually what's there. Because how many other programs get a random six billion in six months over four years? I mean, I can look at the budget papers and tell you, you know, why is the immunization schedule dropping by$150 million in 2027-2028? Why is that happening? Why is the RPBS dropping by$50 million next year? Most organizations didn't get that kind of boost in funding. The NDIS community are talking about how they don't feel like they're getting a boost. You are in a privileged position, and that almost makes it impossible to defeat the government at times and the bureaucracy and what you're seeking change on. But if you think like a patient, it's wonderful that X number of patients got this after this month. But the reality is that there's still another 250,000 patients waiting for X, Y, and Z. We don't deny that you're willing to fund it. We've got to attack what's taking us so long to do it. Because that's it. That's the narrative. That's where you could have got him said thank you so much. Now let's take that step. How do we turn 600 days, or 660 according to you, the department, to 200 days?

Paul 34:43

Yes, don't you uh don't you sort of use the minister's language against him?

Felicity 34:46

Yeah.

Paul 34:47

We absolutely welcome these changes, Minister, and we absolutely agree with you that the system's in desperate need of reform. We absolutely agree with you, but in 2023 you said people are dying waiting for the access to therapy and treatment in this system. We agree with you. That's don't you just say that?

SPEAKER_02 35:01

Yeah.

Paul 35:01

And we're actually absolutely 100% supportive and recognized you've got to work out the sort of statement that was issued on Tuesday is something you've got to work up to. Like you and and that's that's not there. And I and I I look, I just think they need to find a way out of that now. It's a terrible way to start this negotiation because it enabled the minister to to position himself as the victim. You've done this to me. I I can't believe it. But you're deliberately trying to mislead people. I don't either were they deliberately misleading. Well, it's either deliberately misleading or they don't know what they're doing. I mean, I don't think either is particularly good to be honest.

Felicity 35:39

No, I know, but as uh a vet someone whose counsel I I take quite sagely did remind me that 90% of the time it really is incompetence, not it's Occam's raise, is it right?

Paul 35:49

The most likely is is is the probable reason, but it's mistake not mistake, not malicious. It's a silly analysis, which I was warning against all the all the way up, and you you know my reaction on Tuesday night. I've been telling you not to do this. I've been telling you not to do it, and you do it, and it is credibility shredding. Just as you're going into a critical, critical, critical moment. And and worst of all, that new renewed that this sort of newfound sense of urgency. I can imagine in that first discussion, over the phone even, well, would the the health department officials are gonna say, Well, we completely agree with you on the urgency, we really need to get this sorted. So let's get this sorted quickly, shall we? We've already got some ideas developed we'd like to put on the table, let's get it done quickly. They're gonna use that urgency against you. This is what the the this other thing didn't make any sense. Urgency, you know, if if the minister is under pressure to get something done quickly, then that's his weakness, that's his that's his weakness. That's your that's your leverage point. Also, I do know that the department approached both associations early to start a negotiation from one one July. Yes. Which is the other reason you can't complain. If you want to stand by your agreement, and I'm all for that, then we can't get the integrity of the agreement. We know you agree with the integrity of the agreement, Minister, maintaining it, so we can't possibly start. But the consequence of that is that you can't say what you said on Tuesday night. You can't sort of have a sense of urgency when you've shown no no no no urgency. So it's that that's that's frustrating, really frustrating to me, and it worries me. It worries me about what's going to happen. And you have this very strange situation in this public health program where a couple of stakeholder groups have very privileged positions, and they're negotiating the future capacity of this program to provide for the 27, 28 million Australians, whatever it is now. They have this this super privileged position. And we need them to get it right. We need them to succeed.

Felicity 38:07

See, um I yeah, but actually we need them to let the rest of us in.

Paul 38:14

Well sorry. I actually don't think But that's not gonna happen, right?

Felicity 38:17

Well, you never who knows? But but why shouldn't we?

Paul 38:21

No, I complet I completely agree on that. I just don't think there's any record of that.

Felicity 38:25

No, there is no no record of it. But just because it hasn't doesn't mean it should and shouldn't. And I think there's a an interesting point on that, which is as you all do run and race to the table and puff your chests off because you are going there and the rest of us are excluded. Remember, remember what that means, and perhaps occasionally if you let patients do what we do really well.

Paul 38:52

I think New Zealand is the model. There needs to be some humility uh in Australia to look to New Zealand and how the industry over there got out of the way of patients. You had Malcolm, you had Rachel, uh Fiona, and and just be incredibly forceful advocates for change.

unknown 39:11

Yeah.

Paul 39:12

And I and I think uh Rachel in particular, Rachel Smalley, who was very effective in humanizing the impact of Pharmac. So she she never talked about comparators and discount rates. She talked about the human impact.

Felicity 39:25

Yes, and and we've got a bit um blase. And I think the reason it's more effective in New Zealand is because for so long so much didn't happen. The the conundrum and the challenge in Australia is because you have a, hey, as long as the I'm using inverted commerce people, independent expert PVOC, uh gives us a recommendation, we we all commit and agree to list. So we have some almost shibbolets in the system that prevent the robust discussion. So every time you do an article on someone missing out on a breast cancer treatment, or heaven forbid the minister saying people are dying on my watch waiting for MSAC to make a recommendation. The rest of the system goes, and next month, hey, we've got three new listings, uh, and we've got formal generics. Oh, and we've got this. And so ironically, the way the system operates in its privileged state dilutes, distracts, and protects government and the bureaucracy with the more robust decisions that they take. And so, whilst the industry will sit there and argue about what's the next catch-up price cut going to be or what's the next F1, you know, five, ten, and fifteen year statutory price reductions and all that kind of traditional stuff that expires on 30 June 2027, where is the actual conversation about meanwhile as patients, what do we need?

Paul 40:55

Well yes, that is the missing piece. Um and there's no LinkedIn post in the known online universe that can solve that. Um this has to be done properly. Hey, uh diabetes happened, by the way. The government released its response. Very strange tabling of a response to an inquiry. So the inquiry is 2023. It's now 2026. Not unusual for a government to take a long time. But it was tabled budget day.

Felicity 41:38

Except not.

Paul 41:39

Except not. It wasn't actually made available till the next day.

Felicity 41:47

Yeah, it was interesting. There were uh 18 government reports tabled that day, and six were released before budget till the treasurer stood up, and then did the rest were released the next day. And it it was quite amusing. I mean, I know we're going to talk about what was in it or not in it. A number of the ones that have been subsequently released were we'd really love to reply to this inquiry report, but it's been so long since this inquiry that most of the recommendations have passed beyond the ends of time. So we're not responding.

Paul 42:17

That's an oldie better goody, that technique.

Felicity 42:23

We we started when we were first elected, but we're done. Um yeah, look, I I find that one an interesting point. So I I first obviously became aware of it. Thank you to you, because uh Dr. Monique Ryan put out a press release going, what the? And then of course I don't think she her office realized that none of us could actually see what the. Uh so I I think she articulated it quite well, irrespective of what I think about some of the recommendations over others, which was it was more about deferred and delay, and this was just after two years another holding response. Fair. Then I watched patient groups and clinicians put out stuff saying, This is fantastic.

Paul 43:04

That's weird, wasn't it?

Felicity 43:06

Governments responded and they noted everything. There's no there's 14 noted and there's nine support and principle, and we're sure that our support and principle means we're gonna get this stuff. We're so excited to work with the government, blah di blah blah.

Paul 43:19

The people don't realise that noted and support in principle means they're not doing it.

Felicity 43:23

Yeah. Oh no. So I I do find that extraordinary, and then then talking within the sector, which is the ability to have to show respectful dissatisfaction. So patient groups will sit there and say, Oh no, we've got to be nice. Uh we can't, yeah, we're actually upset, but that's not how we we've got to show that we all love the government, otherwise they won't keep working with us. It's like, whoa, no, no, that's actually not how government works. And if you welcome something, how does the government know that that's actually not quite good enough? You can't say, Well, we publicly said this was great. Oh my gosh, I feel

Paul 44:00

Like we're talking about the reverse of we've It's the flip side, it's the flip side of the Medicines Australia response to the budget. People not understanding there's a middle road, but you also have to build up to it. So when I think it was Diabetes Australia actually came out and said it was wonderful.

Felicity 44:16

Mm-hmm. And breakthrough type 1 diabetes and the Australian diabetes educators.

Paul 44:21

But there's nothing in it. There's absolutely not a single thing in it, basically.

Felicity 44:25

Well, there's a lot it was a good traditional one where let us tell you already how much people are doing in this sector. Now that came out at the same time as, and again, again, most people don't read the budget papers the way I do. So the dramatic drop in chronic disease funding in the out years in this country is a massive drop. So you can see why they're talking about, oh, we've got these disease work plans and we've got obesity work plans and we've got prevention work plans and we've got everything going on here. So we're already doing so much. And then you looked at things where they said we've noted, you know, the the supporting principles were in areas like uh awareness campaigns, um making more use of the research funding. I mean, obviously the MRFF will have a giggle about that.

Paul 45:06

Oh, that's hilarious.

Felicity 45:07

People think they're yeah, uh we'll get to that one. Uh we're rebranding that's that's quite yeah, we're rebranding what's already in law. But the most of the materials in there were, oh, and this is something you know with look with long telehealth, etc., which is already under review. So it it kind of always makes me a little bit sad sometimes. Yes, because I know I sometimes am a bit more assertive in saying this is crap, um, and we need to fix this and this is why it's crap. But like I said, we're always the first to come out and say, this is fantastic, and this is why it's fantastic. Like I am all in both ways. But when you actually just after two years of waiting and not having anything, then how is the parliament going to say that this is actually something we need to keep fighting for? When the people who actually did the work, the committee members, express dissatisfaction and frustration that it hasn't really progressed, but you say, all good, we're fine with this, then why does the government need to say, well, if I've got a finite budget and I'm cutting money, and let's say that the NGIS reforms don't go so well, and so my m my billions that I thought I was gonna save aren't going to transition into a reality? Well, I don't need to spend money in diabetes because they all said to me they're fine and they're just happy to keep working with us.

Paul 46:25

Yeah, you've got to it is the flip side of the industry challenge this way.

SPEAKER_02 46:32

Yeah.

Paul 46:32

Is that you've got to find a middle road and you've got to have consistency in your position. Obviously. So what happens in three months' time now if diabetes groups come out and say, Oh, this is absolutely terrible, it's deplorable. What are you what are you talking about? It's like you said this three months ago. It's just it it's it's similar strategically to the issue the industry has had this week. It's just the there's always the risk of inconsistency because you and I both know that privately these groups are absolutely furious with this with this response. Now, I don't think you need to drop a bomb on it, but you can say, you know, you can be sad and disappointed, but you need to work your way up to that so that there are no surprises now or into the future, and you need to think about what is your position. And I said I've said this about other things. You need to think about what your position will need to be in two or three years, accepting that you can't change the trajectory of this issue. It's like it's like the Delphi survey on the HTO things, that's preordained. So when you act about when you are thinking about it now, you need to think about how you are going to respond to it when the inevitable happens, which is why you can't legitimise it today.

Felicity 47:51

Yeah, and I I reflect on what's been happening with pediatric Crohn's access on the PBS. And if you think about that's something that started in 2023 and just cycled on and cycled on and cycled on, and oh, you know, yay for trying everybody and you know, PBSC couldn't possibly, and it just went into an abyss until a mother just said, I cannot take this anymore. And not only got media coverage, but also went to two senators who were willing to take up the cause and and raise it. Now, at least in that area, it was a sectorial representation of patients who had continued to express concern very politely, but had expressed concern and were in forms where they were increasing the pressure to try and say, come on, what what is happening here? If you go in too nice and too happy, then where do you expect the priorities to be? And so even though we've you know we've got the Crohn's pediatric crones moving, it's still not solved. It's still going through the process. I look at the diabetes inquiry and how long it's taking to get extended access to long-term telehealth for particular communities. I look at the support in principle for the GLP ones, which is kind of going nowhere, but support in principle doesn't really solve the problem that the community has with access to those right now. I look that they only noted the reforms to the insulin pump program. So I've watched the community for five years now say, you can't tender and only give us one product. That's not the way it works. Like that product may not work the best for me. And the thing says, look, noted, we get it, but it was a tender, you know, some some win, some don't. Then they also said, you know, we need more of this, like because the waiting list for that program is so high. Yeah, we note it. We'll see what happens about, you know, at some point in time. It's a tiny program. Like you could have literally doubled the money and people would have been excited. It's so small. And then you look at CGM, which again says noted, but it doesn't even note that that's been in front of MSAC now since February 2025. So you have to push back a little bit a bit on these things because otherwise it all becomes too nice. I get really worried when it all becomes about the research money because and again we'll talk about the MRFF. It's great that you're going to get the billion dollars, which is what was legislated all along to actually get the the value after a certain number of years. But the reason you have such a high amount of money for researchers to to play with is because we took money out of primary care.

Paul 50:21

Oh, that was taken out of the PBS, pub public hospitals, everything.

Felicity 50:25

It was taken out of the grants programs, it was taken out of chronic disease, it was taken out of everything. It was taken out of diabetes. So while we're all encouraging and we all love looking forward, I can't wait, as someone who's waiting for newborn blood spot screening, I can't wait 30 years. Actually, if someone has diabetes now, they need care and treatment now. They can't wait for the research that's coming in 15 years, of which, you know,$120 million was spent and that funded some great, you know, researches, some great program trials. But in the end, people have diabetes today. People have Crohn's today. And we need to kind of get a little bit with the program.

Paul 51:01

So I Let's let's talk about MRFF and that announcement. So everyone will have been following the fact that there was a bipartisan agreement to uh pass legislation that capped disp annual disbursements for a number of years, four or five years I think, from the MRF out to the end of this decade, I think, to six or seven hundred million to protect the capital base.

Felicity 51:32

Yep, same as same principle behind the future fund.

Paul 51:35

Yeah, so and the future fund, I think they administer the MRF. They've obviously got a fair fund.

Felicity 51:40

Well, they administer the investment of the funds.

Paul 51:42

Yes, they they they've got a very good record on investor returns, uh judging by the future fund. So they wanted to grow that base and protect it. And this has attracted a lot of criticism because people said, well, it should be a billionaire, they can afford to give a billion a year. And the government has come out this week and said, Oh, yeah, yeah, we're gonna we're gonna we definitely agree with uh with that approach and we're going to uh implement that as per the legislation. And I think people were a bit confused by it.

Felicity 52:17

Yeah, they they I saw press releases from politicians saying, it's great, we fought, we won, I might. Okay, that's all right. That's that's fine. And look I sometimes people misunderstand, sometimes people yeah, look. I'm not I'm not gonna go into it because I just think sometimes we present things and we we repackage and we re-announce, and all sides of government over the years do it where they re-announce something that's already been there and stuff, and and it's a good strategy and it's a good reminder for people. I just think that there there is a lot to be advocating and concerned concerned about in the coming you know few years, and we can sometimes put a lot of effort into something that's actually not really necessary, but that's that's okay.

Paul 53:02

Yeah, I I think you you made a really good point, and it's worth reminding people that the MR MRFF was established out of the twenty fourteen-fifteen budget from savings generated from public health programs. Yep. And uh was that a good thing? I don't know. I suspect not, in the end.

Felicity 53:26

Well, he hi here if if you chart it, and we have, if you chart it, not because I blame the MRFF, but if you want to look at the ti the extension in listing delays on the PBS at the same time that we've now moved into an MRFF, imagine if that billion dollars a year was available for services and devices and diagnostics.

Paul 53:48

It was a the PBS saving in that budget was a very significant increase in patient copay.

Felicity 53:57

Yeah, which we then had to offset.

Paul 53:59

Yeah, yeah, but you know that that was they they they they funded the plan was to fund the MRFF by making medicines more expensive.

Felicity 54:05

And yeah, and uh GP visits too.

Paul 54:08

Yes, uh the GP copay. And then it ended up, I think, mostly being from public hospital funding. There was a special fund.

Felicity 54:15

Yeah, it was also from we cut grants programs quite uh ferociously. And we also cut baseline programs that we funded federally more across the board. So that's where it all came from, and we took it out of the out use. And like I said, I don't dispute the fact that we need to be a forward vision thinking that research is good. Both research for research's sake and applied research are important principles and grow an important part of our economy here in Australia. But when we're talking about the MRFF, and because it is in the health sector, you need to remember at times while you're arguing for your extra 350 million, the mum with stage four colorectal cancer who's waiting for the medicine that she'll never get has a slightly different view. And so I think we need to walk with a light step and understand that if you, research sector, just got your money, then how are you actually making sure that all the money we spend on your research means better patient care today?

Paul 55:14

Yeah, well, it would be worth assessing all the all the grants, the research grants, on what impact they have on patient outcomes.

Felicity 55:26

Yeah.

Paul 55:27

Crazy idea, I know. Uh now breaking news.

Felicity 55:32

Okay.

Paul 55:33

The minister is uh about to do a media conference to update Australia on the handovirus issue. We're we're back into the daily pandemic press conferences. The national incident room will be peep beep beep beep chugging along. All the TVs will be on, sports channels.

Felicity 55:55

Importing for more pee-pee.

Paul 55:57

It's it's for this rat-infested virus.

Felicity 56:00

Which will be funny because um again in the budget.

Paul 56:03

Shouldn't laugh because obviously people get sick, but I just think it's the it's just bringing back all those chilly memories from COVID.

Felicity 56:09

It is, and um it it will be interesting because again, if you look at some of the reporting, like I said, I'm genuinely interested in what's going on with the vaccination, uh, the immunisation programme in the outliers, and I'm hoping to get to the bottom of that during estimates. But we also looked that the national medical stockpile has had some changes made to that uh in the budget, and now we've got this again. And I think if anyone works in that sector, we we did giggle that the CDC was like, we've got something to do.

Paul 56:37

But um But you know, that's that's not even a joke. You know exactly that's what the sentiment would have been. We can prove ourselves here, team.

unknown 56:46

It's great.

Paul 56:46

It's not just a logo.

Felicity 56:48

We need some bigger TVs.

Paul 56:49

We need some bigger TVs, and we need some more people. Incident in the incident room.

Felicity 56:52

And I'm not and I and I shouldn't joke about that too, because as someone who visits um a residential aged care facility on a regular basis, it is a good time, please. Exciting news in pharmacy got the universality of being able to vaccinate children under five under the National Immunisation Programme, which is fantastic. And the reason that is fantastic, I know RACGP will send me more hate mail, uh, is because it means that it continues that continuum of care about a patient-centric. If I'm going there, I can get my vaccination done, my teenagers done, my babies done. And that's a really important area because as someone who does visit residential age care facilities and it's already started with the respiratory viruses area, and we're having to wear you know face masks and um and in some some areas actually, you know, full PPE. They they are some of the most vulnerable in the community and those who are immunocompromised and can't always get a vaccine. So please protect yourselves, but protect those in the community who have spent a long time contributing to our society, and all they're asking for is that some of us have a vaccine to stop them getting sick.

Paul 57:58

Yeah. I had my flu shot recently.

Felicity 58:00

Yeah, I've done mine.

Paul 58:02

Okay, well, uh I just want to finish on our communications minister, Annika Wells.

Felicity 58:10

Oh, is she coming to your birthday?

Paul 58:13

Well, fortunately my birthday's not for a while. But apparently the Parliamentary Expenses Authority did approve her claiming of expenses to fly to Adelaide for to attend a meeting that happened to be held at a friend's birthday party at a at a pub venue. And there was that fantastic question in I don't know whether you saw it yesterday, she was asked, because someone obviously the coalition went and had a look at this venue, and they said, Did you did you have the meeting in the restaurant in the pokey area or the bar area, the sports bar area? Where which which room did you hold the meeting in?

Felicity 58:55

And do you know what's really funny? It was very, very funny. It was it was good entertainment. But we also need to reflect on the standards that we hold our senators and members to. So if you think about what I know you do get me started. You imagine, as a small business owner, as I am, if we tried to do that with the Australian taxation office and say, hey, I flew over there for the weekend, I just happened to have a meeting with someone and I'm just claiming it all. You actually wouldn't be allowed to. Or if you genuinely did it, you could only claim the portion of the hour that was the meeting. And the fact that you also did something in a personal capacity means that you also have to distinguish and diminish the value that you claim. Like you can't claim the full amount of your phone and your laptop on your internet if you're working from home. So these differing areas of standards, that's that's actually quite well.

Paul 59:48

Double sense, it's a complete entitlement culture. Remember over the years how our elected representatives have criticized groups like the pharmaceutical industry for the relationship with doctor. Now, anyone is with doctors, anyone who's been to one of these industry-sponsored medical education events know that the doctors go in spite of the food.

SPEAKER_02 1:00:07

Oh, yeah.

Paul 1:00:08

Not because of it. The days of going to these fantastic restaurants ended 25 years ago. It is absolutely deplorable. I've attended industry events where they've actually they've been great, actually. I disclose it all. They flow me overseas and they put you up in a hotel and it's like a DOS house. I was put up in a hotel in Switzerland once. Didn't have a phone in the room.

SPEAKER_02 1:00:30

Wow.

Paul 1:00:30

It looks like a prison cell.

Felicity 1:00:32

Life happens.

Paul 1:00:34

Well, but but you know, but but but then our politicians just it is like it is an entitlement class. And you know, you know, we where where we are here is where a lot of the comp car drive, they drop them off in the morning and they come and have a coffee and some breakfast here, and you see the the rows of BMWs because they're all they've got all those BMW EVs now.

Felicity 1:00:58

Yeah, they won't get their tax breaks anymore. And it's also an important point because I think it was great to hear you know, we're having a a tax debate now in Australia, so with the right of reply. And I think it's good. We need a we need a more open conversation about where we're going with you know the ideas of CGT and etc. But one of the things that's really peeved me off in the CGT debate and the negative gearing debate is we've talked about in the past, politicians claim their travel entitlements to come to Canberra, which is tax-free, and they use that to purchase housing here in Canberra, effectively tax-free, use their travel allowance to pay off the mortgage on that, and then actually sell that for a profit. And if you are going to that that's that's a dollar that they get to invest that is not taxed, as opposed to if you or I have an investment property in in Canberra, we've already had that dollar taxed five or six times before we've then actually gone and purchased something again to do that. So I I think that the travel rorts, and as someone who's been in that area of the department many years ago, I I think there are some things about what do we expect from our politicians, and we do expect better. And enough's enough.

Paul 1:02:17

Yeah, it's it's really, really bad. And because if you live in this part of Canberra, you see a lot of it up close. The largest. Yes, yeah, like parking in disabled car parks to go to the supermarket and cars waiting, and it's just it's not on. It's it's really not on. And uh particularly in an environment where cost of living is a real concern, and the government has politically recognised that I did laugh. After Angus Taylor's reply speech last night, where he talked about indexing income tax thresholds, on the ABC, of course, the 730 report, the political uh reporter said, Well, this is gonna put a real fiscal strait jacket on governments. And I just kind of went, Yeah, well, they need one. They absolutely need one. Because every time they go overboard, they just go off and tax us more. And the tax on wealth means there's gonna be less wealth. It's it's it's a very, very, very nine, you know, basically, you know what I say, you know, Harold Wilson called them what's the 1970s back, but you know, basically it's all this concept of unearned income is really offensive.

Felicity 1:03:33

It is. I I think the other one that I found hysterical from last night's writer's reply speech, and the question was, yeah, but you're not going to index um the pay as you earn, pay as you go tax thresholds until starting in 2028. And no one actually pointed out he's not in government yet. He's not in government, like he actually has to win the elections and put the legislation through. So that to me was like, you know, it's like, oh yeah, but you're not planning to do this for like two or three years. It's like, yeah, well, first of all, they actually have to be in government.

Paul 1:04:03

Yeah, at least there's a policy debate now, which I think is which I think is good. Very good.

Felicity 1:04:07

We definitely need it.

Paul 1:04:08

Alright. Well, another budget week over.

Felicity 1:04:13

Your conference on Monday.

Paul 1:04:15

Oh, yeah. Yeah, I'm it's well, got something to talk about.

Felicity 1:04:19

Yeah.

Paul 1:04:20

It's gonna be really, really good. Uh, I'm really looking forward to the start of the day. We've got two patients who are actually traveling to attend, and uh they have uh some heroin stories to share, and I just want to thank them in advance for their courage in sharing those. It's a real privilege to be able to provide a platform for that. I know it can't be easy, so their uh willingness to do that is um is is deserving of the highest respect and gratitude.

Felicity 1:04:51

Excellent.

Paul 1:04:52

Thanks for listening. Thank you, everyone. Keep the the feedback uh coming and keep using the AI function. I know a couple of companies have security issues with it, but we're getting through all of that. But uh we are getting several hundred queries a day now, which is great. And so the more queries you do, the better and better and better it gets. So thank you for being supportive of that. And uh, you know, carry on. Thanks, Felicity.

Felicity 1:05:14

Thanks, Paul.