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Prescription Drugs

A Cost-Effectiveness Approach To Drug Subsidy And Pricing In Australia

The Australian government offers its citizens subsidies on a select list of pharmaceuticals. For a drug to qualify for inclusion on this list, its manufacturer must demonstrate that the drug is both clinically effective and cost-effective. In part, this measure, along with others, was introduced to improve clinical and economic outcomes. Although this evidence-based system has provided transparency and consistency in decision making about which drugs will be covered, it may not have contained the rate of increase in drug costs.

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