Health officials are warning that the country’s $5bn drug-maker monopoly has been exposed as a “massive monopoly” that is “destroying lives”.
A leaked memo published by the Australian Competition and Consumer Commission (ACCC) showed that Medtronic, a giant Australian pharmaceutical company, was “exceedingly inefficient” and its competitors were “ineffective”.
The leaked document also showed that the ACCC was considering legal action against Medtrig, the largest of the three monopolies, which owns the market in Australia for generics and injectable drugs, for breaching the Competition and Consumers Act.
“The drug monopoly is a huge and entrenched problem in Australia,” ACCC chairman Rod Sims said.
“There is nothing more entrenched than a monopoly.
The problem is the drug monopoly in Australia.”
The ACCC’s decision to take action against the monopoly is the latest step in the drug industry’s ongoing efforts to wrest control of Australia’s drug market from the state-owned pharmaceutical companies.
In November, the Australian government passed the Pharmaceutical Benefits Scheme (PBS) to help small and medium-sized businesses (SMEs) compete in the lucrative industry.
But there are concerns that the system is a patchwork of rules and regulations that have not been properly designed, and which have left patients with little control over how much they receive for their medicines.
A large number of drugs were withdrawn from the PBS system over concerns that they had been misbranded.
“We are facing a massive monopoly in the industry,” Mr Sims said, warning that Medtech, a rival, had become so dominant that it was now threatening the existence of the industry.
“If the state is able to hold onto the monopolies it can hold onto these monopolies.”
Medtruys CEO Andrew Mitchell was unavailable for comment on Wednesday.
“While Medtech has been a big player in the market for a number of years, it is a new player in that the Australian Medicines and Healthcare products Regulatory Agency has recently published a report that points to Medtech’s dominance in the Australian Pharmaceutical market,” Mr Mitchell said.
Medtech declined to comment.
‘Bureaucratic nightmare’ ‘If the government is able in this bill to hold on to the monopolys, it can also hold onto those monopolies.
We are facing an administrative nightmare’ “The industry is facing a bureaucratic nightmare, with the government unable to create new regulations to deal with a situation where the industry has been monopolised,” he said.
Mr Mitchell is calling on the federal government to introduce a national framework for the Australian pharmaceutical industry to ensure that competition is preserved and the government’s control over the market is preserved.
“Our industry is in a bad situation and that’s where we need a national system to address that,” he added.
Medtres chief executive officer Andrew Mitchell, pictured here speaking at the Australian International Pharmaceutical Day at Sydney Airport in September.
Mr Sims has also urged the federal and state governments to reform the Medicare system.
“In the past, the government has tried to reform Medicare, but failed,” he told ABC radio.
“So if the government wants to reform this, they need to take a look at the Medicare Act and see if they can do things to preserve the integrity of Medicare.”
‘We need to look at Medicare and the way it works’ Health experts say Medtech is a “huge, entrenched problem” and Medtech and other large Australian pharmaceutical companies are “inefficient”.
Dr Richard Brierley, chief executive of the Australian Medical Association (AMA), said the leaked memo showed that “it is a very large monopoly that is undermining the lives of millions of Australians”.
“We’ve got to look into this, the regulator has to look in to this, it’s a bureaucratic mess that we need to get rid of,” Dr Brierleys chief executive, Michael Meldrum, told ABC Radio.
“That’s why I’m calling for a national review.”
Mr Sims’ comments follow a report last week by the Commonwealth Scientific and Industrial Research Organisation (CSIRO) which found Medtech was responsible for more than half of the drugs withdrawn from Medicare since 2013.
The report, released by the CSIRO’s Pharmaceutical Research and Development Agency (PRDA), also revealed that Med Tech was the “biggest supplier” of the generic drugs to the Pharmaceutical Research Council (PharmacRx), a trade group that is part of the Pharmaceutical Products Regulatory Agency (Phras).
The Pharmaceutical Products Agency, the industry body for generic drugs, said that although Medtech had the largest market share, it was also the biggest importer of generic drugs from Australia.
“Medtech’s monopoly in generic drugs has resulted in significant harm to Australia’s health system and is a critical driver of the growing costs of health care and other costs in the country,” said Dr Briersley.
“Given the enormous burden that MedTech’s monopoly places on the Australian health system, we must ensure that there is no room