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Evidence-Based Decision-Making Within Australia's Pharmaceutical Benefits Scheme


In Australia, most prescription drugs are subsidized through the Pharmaceutical Benefits Scheme (PBS), one of several government programs in which evidence-based decision-making is applied to the funding of health technologies. PBS processes are intended to ensure "value for money" for the Australian taxpayer and to support affordable, equitable access to prescription medicines; they are not intended as a mechanism for cost containment. The inclusion of a drug on the national formulary depends on the recommendation of the Pharmaceutical Benefits Advisory Committee (PBAC), which considers not only the comparative effectiveness but also the comparative cost-effectiveness of drugs proposed for listing. While some decisions have been controversial, the PBS retains strong public support. Moreover, evidence does not suggest that the consideration of cost-effectiveness has created a negative environment for the drug industry: Australia has a high penetration of patented medicines, with prices for some recently approved drugs at U.S. levels.

Publication Details

Publication Date: July 22, 2009
Author: Ruth Lopert

R. Lopert, Evidence-Based Decision-Making Within Australia's Pharmaceutical Benefits Scheme, The Commonwealth Fund, July 2009.


Principal Medical Advisor, Therapeutic Goods Administration