Survey for the 24-month review of the Minimum Stockholding Requirements

Overview

Minimum Stockholding Requirements 

From 1 July 2023 minimum stockholding requirements (MSR) have applied to certain medicines listed on the Pharmaceutical Benefits Scheme (PBS) referred to as Designated Brands. The MSR is designed to help protect Australian patients, pharmacists, and prescribers from the impact of global medicines shortages. While these measures will not prevent shortages that are outside of the control of Australian companies, they will help to ensure that Australian manufacturers are better placed to continue supply when global disruptions occur. Greater buffers will allow time for supply disruptions to be resolved and ensure better continuity of supply for Australians, including through identifying alternative sources of supply (where possible).

Designated brands meet one of the legislated criteria in Section 99ADHC of the National Health Act, 1953 (Act). In brief, designated brands are:

• Older, multi-branded medicines which have been subject to price disclosure arrangements for a certain amount of time;
• Medicines priced at $4 or less at the manufacturer level; and
• Medicines which have received a price increase

The minimum stockholding requirements provide supply chain security for over 3,000 brands on the PBS, including medicines used to treat diabetes, epilepsy, arthritis and asthma. A list of Designated Brands subject to these arrangements is included on the PBS website.

The MSR are outlined in Division 3CAA of the Act and involve:

1. Substantive stockholding requirements: Responsible Persons (RPs) of ‘designated brands’ must hold 6 months stock by reference to ‘usual demand’ if the brand received a price increase on or after 1 July 2022, and 4 months stock if the brand did not receive a price increase. The stock that is kept must be available for sale in Australia by the RP.
2. Disclosure requirements: twice a year RPs must disclose their quantity of stock of the designated brands kept in Australia to the Department.
3. Notification requirements: RPs of designated brands are required to notify the Department of a likely or actual breach of the MSR in accordance with s99AEKD of the Act. RPs must report an actual or likely breach of the MSR 'as soon as practicable':

12-month review of the MSR

The Department completed a 12-month review of the implementation and early outcomes of the MSR in July 2024. The review was conducted through engagement with the medicines industry.

Overall, the review found that the policy has had positive impacts. The medicines industry has made changes to increase their stock levels and early data indicates there was a 13% decline in the number of shortages of designated brands between 2022-23 and 2023-24. However, a 24-month review was recommended to further evaluate the effectiveness of the MSR, its impact on medicine shortages, as well as the regulatory impact on the medicines industry.

Key findings and recommendations of the 12-month review are contained in the Executive Summary which is available here [12-month review of the MSR].

Purpose of the Survey

The Department is now conducting a 24-month review of the outcomes and impacts of the MSR and we are seeking your input to the review through this online survey. The department is seeking your feedback on the MSR in order to continually improve the operation and effectiveness of the MSR in the prevention and management of medicine shortages.

Many of the questions in the survey are optional. The department recognises that you may not be able to answer some of the questions, or may not have the information being requested, but would encourage you to complete the survey as comprehensively as possible. This will provide the best outcome in terms of the policy review and the operation of the MSR.