Pharmac review: ‘Damning’ interim report reveals ‘fortress mentality’, Māori, equity progress slow

An interim report of a major Pharmac review has slated the Government drug-buying agency over its “fortress mentality” to sharing information and poor progress in addressing equity issues.

This included the fact just 2 per cent of its nearly 150 staff were Māori, despite vowing to prioritise Māori leadership and uphold the Treaty of Waitangi.

The review panel itself stated it had been blocked from accessing information it needed, consequently making it unable to make “meaningful comment” about the performance of the agency.

The Act Party says the whole process needs to start again.

Labour had campaigned before last year’s election to conduct an independent review into Pharmac, which independently decides medicines to buy with Government funding, focusing on the timeliness, transparency and equity of its decisions.

The interim report, released today, has been delayed months, which the Government says is due to the latest Covid-19 outbreak. The final report itself has been pushed back from an original due date of December 10 to February 28 next year.

The interim report sets out what the review panel has seen and heard, and outlines some of the issues it has found, while the final report will provide recommendations.

The panel heard from more than 200 submitters and found a range of issues, including around addressing inequities and transparency around decision-making.

The panel itself stated it had struggled to get information it needed and therefore could not make “meaningful comment” on Pharmac’s performance.

“Pharmac zealously guards information about a host of operational and financial matters, making it difficult to measure the extent to which it is meeting its objectives.

“What information it has given us limits meaningful analysis. This lack of information extends to such basic facts as the cost savings on listed medicines; as noted, Pharmac has only provided indicative ranges for rebates, not actual figures.”

The panel said the “fortress mentality” would not bode well under the new health system, which focused on greater co-ordination and accountability.

This process left the public “poorly informed about the decisions it makes”, the panel said.

This was in part to leverage better prices, but raised major questions around transparency and oversight, they said.

The panel also noted concerns around steps to address inequities.

The approach appeared to disadvantage Māori, Pacific people, disabled people and those with rare disorders, it said, and Te Tiriti o Waitangi principles were “largely unseen in decision-making processes”.

While committed to prioritise Māori leadership and uphold the Treaty of Waitangi, in the year to June 2021, just four of Pharmac’s 146 staff identified as Māori, or 2 per cent. This proportion had steadily decreased over the past five years.

Patient Voice Aotearoa’s Malcolm Mulholland said it was an “extremely damning” report, and “alarming” Pharmac would not provide the information requested.

“The overall impression is we have a government agency that beats to the sound of its own drum. They need to be reined in. This reinforces the experiences of patients.

“People still don’t know why decisions are made.”

Mulholland has been advocating for reform at Pharmac since his wife Wiki was diagnosed with terminal breast cancer in 2018.

Wiki died six days ago.

While there were publicly-funded drugs that would extend her life, the best were not funded and were far too expensive for the family.

Their campaign for reform revealed the opaque process to determine that funding, along with the personal costs.

Mulholland said the panel’s comments around Māori and inequity were “not surprising”.

“Māori are diagnosed with cancer later, they have less means to self-fund medicines, which means Māori have a lower life expectancy.

“Being Māori at Pharmac must be a bloody hard thing.

“But I think Wiki would now want politicians to listen to this; this is part of Wiki’s legacy now.”

Act Party health spokeswoman Brooke van Velden said the lack of transparency revealed in the interim report was “shameful”.

“Pharmac has obfuscated an independent Government-commissioned report. This is insulting to people who have lost loved ones due to their medicines not being funded.”

Act had called for a review last year before the election; Labour and National agreed they would follow through.

However, van Velden said this report was a “whitewash” and the whole review process needed to start again, and Health Minister Andrew Little should require Pharmac to cooperate.

“It should be done properly with new terms of reference to include funding. The minister should require Pharmac to this time be cooperative. They should not be able to hide behind commercial sensitivity to limit an independent review of their statutory obligations.”

Little said he had taken note of the panel’s comments, particularly about equity and transparency.

He said Pharmac, set up in 1993, had been the “envy of the world”.

“New Zealanders are among the only people in the world who have access to free medicines. In most countries, families have to spend hundreds or even thousands of dollars a year for even everyday medications.”

However, he said it was “sensible” to make sure it was doing the “job we want it to do”.

The final report would include recommendations for addressing issues identified by the panel, he said.

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