Key Points
- Labor said it would commit to passing legislation to make the maximum cost of prescription PBS medicines $25.
- The Coalition said it would match the policy.
- Such a change would bring down the cost of medicine for working Australians not eligible for healthcare subsidies.
Prime Minister Anthony Albanese has vowed to defend Australia's subsidised medicines scheme by pledging to further cap the cost of most prescriptions at $25 if Labor is re-elected.
The Coalition quickly matched the government’s plan, with the pledges coming after a group of pharmaceutical giants in the United States complained that the scheme used “damaging pricing policies” and called on President Donald Trump to add Australian PBS manufacturers to his tariff list.
"It's not surprising that there is a push and some opposition to the PBS but let me be very clear and explicit — the Pharmaceutical Benefits Scheme (PBS) is not for sale," Albanese said during a speech on Thursday, describing the program as a "core part of who we are as Australians".
"It is a monument to the fairness at the heart of Australian life and we don't negotiate our values."
The cost of medicines is just one part of the Australian household budget that has increased due to inflation in the economy. Source: Getty / Bloomberg
The group also argued that PBS manufacturers were effectively dictating access to the Australian market, causing delays in access to new medicines, and making it harder for international companies to compete.
But the PBS improves the lives of Australians, Albanese said, and cheaper medicines make it easier for citizens to look after their health.
Labor promises $25 cap on PBS prescription medicines
The Albanese government revealed on Thursday it will commit to passing legislation to make the maximum cost of prescription medicine covered by the PBS $25 if it is re-elected.
The new capped price would take effect in January 2026.
The current maximum cost of filling a script for a PBS medicine is $31.60. While it used to be $42.50, it was reduced in January 2023.
Labor's proposal would bring down the cost of medicine for working Australians not already eligible for healthcare subsidies on the cost of their scripts.
While the , is yet to be called, cost of living and health are tipped to be major issues throughout the campaign.
"Cheaper medicines is another way we are helping with the cost of living while putting downward pressure on inflation — our number one focus," Albanese said in an earlier statement.
Labor highlighted its plan would result in a "more than 20 per cent cut" in the maximum cost of PBS medicines, which it expected would save Australians more than $200 million each year.
More than 80 per cent of prescription medicines are part of the PBS, which enables the government to cover part of the cost of common prescription medicines.
Opposition leader Peter Dutton said the Coalition supported the plan and had gone to the last election with a similar policy.
"We support affordable medicines," he told 2GB radio on Thursday.
"It's good for prevention, it's good for people to have well-managed medication programs, and you get better health outcomes in the system."
According to the Pharmacy Guild of Australia, which had been calling for the government to lower the co-payment patients have to pay for such medicines, 21 per cent of Australians had struggled to afford their prescribed medication in the past three years.
Guild national councillor Mario Barone had said Australians were "being forced to make tough choices between filling prescriptions and paying the rent, buying groceries and putting petrol in the car".
'We will not negotiate over the PBS'
Speaking earlier on Thursday, Health Minister Mark Butler also pushed back against concerns from the US.
"This is not the first time that big pharma in the US have pushed against us," Butler told the ABC on Thursday.
"Their interest is in selling medicines at top dollar. Our interest is in making medicines cheaper for Australians.
"We have to make it crystal clear as a government that we will not negotiate over the PBS."
Butler said the government is continuing negotiations to ensure there are no tariffs put on pharmaceutical trade.
"We export pharmaceuticals to the US every year. But they export $3.5 billion to us. So we're both benefiting from free trade."
— With additional reporting by the Australian Associated Press
