Not the end but the first act in a sequence that will have a broader impact

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It is fair to assume that the new Community Pharmacy Agreement, the eighth iteration, will have broader implications for the pharmaceutical sector.

If not, it would be the first because the seven previous agreements dating back to the first in 1990 have triggered broader changes for the PBS.

Some will welcome those implications. Yet others might find themselves on the wrong side of the Budget ledger.

People can deny it and even accept Health Minister Mark Butler's recent imprudent assurance that the industry will not need to contribute to the additional $3 billion invested in the new Community Pharmacy Agreement (CPA).

It is about the sequence.

The new CPA is the first finalised act of the sequence.

The first act also includes a new agreement between the Commonwealth and the Pharmaceutical Society of Australia (PSA). The agreement requires the PSA to deliver updated standards and guidelines for pharmacy practice. Some additional work on pharmacy programs not included in the CPA will be negotiated during the remainder of 2024, presumably as an adjunct to the broader Scope of Practice Review led by Professor Mark Cormack, which is due to deliver its final report in late 2024.

The next act involves the Government finalising a new stand-alone agreement with pharmaceutical wholesalers. Negotiations intensified in the past week. The goal is to finalise the agreement by 1 July. It will include updated wholesaler remuneration arrangements and presumably a new Community Service Obligation.

The National Pharmaceutical Services Association (NPSA) welcomed the CPA announcement. 

Chair Richard Vincent said, "NPSA’s discussions with government are well advanced following a constructive dialogue which has focused on future funding for a sustainable medicine distribution supply chain that delivers equitable, timely and affordable medicine access for patients. We look forward to finalising arrangements to align with the timing of the Guild’s agreement."

It does not end there.

The Government has yet to respond to the chemotherapy and health technology assessment reviews. Australia's updated National Immunisation Strategy also has implications. Judging these reviews and the Government's responses as part of the sequence involving pharmacy groups and wholesalers would be right. The industry should consider this sequence against the backdrop of history and the realities of its ambitious reform agenda.

If the Albanese Government adopts reforms to accelerate funded access to prioritised medicines and vaccines, it must be paid for.

What about the reform of chemotherapy funding arrangements? The Society of Hospital Pharmacists of Australia welcomed the new CPA. Yet, it will be watching closely for any implications.

In her recent BPD Annual Conference address, Shadow Health Minister Senator Anne Ruston highlighted the need for ministers and stakeholders to 'pay for reform'.

The former secretary of the Department of the Prime Minister and Cabinet, Dr Ian Watt AC, made a similar point. Dr Watt said that reform needs to be funded and that stakeholders are wise to prepare and be proactive in their approach to policymaking.

As the broader pharmaceutical sector navigates the sequence of events now marked by a new CPA, the message could not be more unmistakable - be prepared for what comes next.