M E M O R A N D U M
To
Kirsten Stephenson, Group Manager, Health System Monitoring, Regulation
and Monitoring, Ministry of Health
CC
Kevin Davies; Sarah Key; Peter Jane – Ministry of Health
From
Michael Johnson, Director Strategy, Policy and Performance, Pharmac
Subject
Initial information Budget 2025
Date
30 October 2025
1. Further to your email of Tuesday 29 October 2024, please find attached initial information
below on three proposed investment options for Budget 2025 and the risks and trade-offs
for Pharmac if we not to receive any new funding at Budget 2025.
Increase to the Combined Pharmaceutical Budget
2. In Pharmac’s 2024/25 letter of expectations Minister Seymour indicated the desire to
update Pharmac’s assessment and decision-making processes to include the potential
wider government fiscal impacts that funding a medicine or medical device would have
and that Pharmac has the tools to consider wider societal impacts
3. Pharmac have work underway to develop a proposal to seek an increase in funding for
the Combined Pharmaceutical Budget in Budget 2025 that would support Pharmac to
investigate the impact of a small number of medicines that would return positive
economic and/or societal impacts.
4. s 9(2)(g)(i)
5.
under the Official Information Act 1982
Increase to Pharmac’s operational budget
6. Pharmac’s 2024/25 Letter of Expectations outlined a range of actions and improvements
that the Government expect Pharmac to progress. Whilst we can progress most actions
within existing operating budget baseline, additional investment in Pharmac’s operating
budget is required to make changes and improvements to accelerate our work to
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increase patient voice and engagement activity; modernise our data and digital
infrastructure and provide necessary additional capacity to deliver medical devices.
Increasing patient voice and engagement
7. Pharmac is reviewing its consumer engagement practice with the aim to ‘reset’
relationships with key consumer representatives. In November we are delivering two
independently chaired and managed collaborative workshops with consumer
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amend or potentially stop plans this year for planned investments in new or widened
access to medicines following the June 2024 budget uplift.
19. If changes are made from 2025/26 and no new funding is provided in Budget 2025, we
wil have to meet costs within baseline, which would severely hamper Pharmac’s ability to
progress funding of new medicines or widening access.
20. Please let us know if you require any further information. We would be happy to discuss
further.
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