It's genuinely hard to believe that those behind the so-called health impact statement on the proposed 12-country Trans Pacific Partnership Agreement (TPP) believe what they've written in relation to the PBS.
The report itself simply does not support the claims it makes in relation to the PBS. On the contrary, taken as presented they show virtually no impact on the PBS as a result of the TPP.
For example, based on a leaked draft intellectual property chapter, the report claims that a requirement for Australia to maintain its existing laws on patent term extensions would somehow contribute to higher drug prices.
"In the most recent draft, the scope [patent term extension] has narrowed to new pharmaceutical products. However, this would still lock in arrangements in Australia that keep drug prices high," it says.
Their argument appears to be not that the cost of the PBS will rise as a result of patent term extensions, but that it could inhibit the Government's ability to wind back patent term extensions, as recommended by the recent Pharmaceutical Patents Review - which produced a report quickly shelved by the former government and outright rejected by the Abbott Government.
The Government is already required to maintain the patent term extension policy under the terms of the bilateral US-Australia Free Trade Agreement, so any commitment in the TPP would likely replicate previous agreements and Australia's existing law, as this new report itself says.
The report then claims that extending Australia's data exclusivity period would "cost the PBS in the order of hundreds of millions of dollars each year."
The report it references to justify this claim shows nothing of the sort.
What it does show is that simultaneously listing biosimilars of 10 PBS-listed biologics would generate annual savings of over $200 million through the application of the mandatory 16 per cent price cut.
Yet that is not ever going to happen, a fact the report confirms in its own references.
"...the patents underlying these drugs are due to expire at different times. However, the simplifying assumption that all expire in 2013 shows the impact on PBS outlays of the entry of biosimilars. Whatever the date of entry of the first biosimilar, the price reduction at that point will be 16%."
So, why not just model a 100 per cent price reduction? It's about as likely. And how does the simultaneous launch of biosimilars due to patents expiring on 10 high cost biologicals demonstrate anything in relation to data exclusivity?
It is definitely worth debating whether biologicals should have longer data exclusivity periods, but that debate should be based on a more solid analysis than the fiction used in this so-called health impact statement.
Conflating patents and data exclusivity is a standard tactic of those opposed to free trade, and particularly the inclusion of anything on pharmaceuticals.
The report argues that adopting these intellectual property measures - recap: the one that includes maintaining existing policy and the other which its own reference undermines - would drive up the cost of the PBS, leading to higher patient co-payments, reduced utilisation and poorer health outcomes.
The report's content simply does not support this conclusion.
The report then argues against transparency, which is ironic given its own demands for transparency on the TPP text.
Apparently, transparency for some, but not all.
But even this argument is not supported by the report's own content.
The report claims a long list of US demands on transparency, and then acknowledges that they have already been rejected, and a revised proposal tabled.
It goes on to say that, "Recent commentary, suggests that the recent revision may be more similar to the provisions in the Australia-US Free Trade Agreement than the original US proposal, which would mean less extensive changes to Australia’s PBS than the original US proposal. However, there are still considerable risks involved in negotiating provisions that will affect the PBS."
Why? Apparently, because they say so (It's the vibe...).
Trade Minister Andrew Robb has explicitly ruled out agreeing to any change that would negatively impact the PBS.
So, despite clearly failing to demonstrate its case in the report, it concludes that: "There are several provisions in the TPP that may lead to an increase in the costs of medicines, and subsequently a higher out-of-pocket expense for patients."
The only real conclusion is that this health impact statement was designed as a political document, in which the contents were constructed around a set of pre-ordained conclusions on a range of topics, notably the PBS.