1 Background

On this page: 1.1 Codeine scheduling | 1.2 Objective | 1.3 Approach | 1.4 Sources and manipulation of data

1.1 Codeine scheduling

In Australia, medicines and poisons are classified according to the level of regulatory control over the availability of the substance to the public. The greater the control, the higher the schedule number and the greater the risk to public health and safety. The Standard for the Uniform Scheduling of Medicines and Poisons (SUSMP), known as the Poisons Standard, publishes the scheduling of medicines and poisons, which can in turn be given legal effect in state and territory legislation.

Codeine is understood to have analgesic and/or antitussive properties, and is present in many medicines classified under four schedules in the SUSMP, as detailed below.

• Schedule 2: Pharmacy medicine - These medicines are generally only available for purchase from pharmacies. They are referred to as over-the-counter (OTC) medicines, but professional pharmacist advice is not required for purchase of Schedule 2 medicines.
• Schedule 3: Pharmacist only medicine - These medicines are only available for purchase from pharmacies. They are also referred to as OTC medicines, and professional pharmacist advice is required for purchase of Schedule 3 medicines.
• Schedule 4: Prescription only medicine - These medicines are only available for purchase from pharmacies with presentation of a valid prescription (i.e. from a medical or dental practitioner).
• Schedule 8: Controlled drug - These substances should be available for use but require restriction of manufacture, supply, distribution, possession and use to reduce abuse, misuse and psychological dependence.^[14]

Over the past decade, the Advisory Committee on Medicines Scheduling (ACMS) and its predecessor committee, the National Drugs and Poison's Committee (NDPSC), have given consideration to the scheduling of codeine and its availability as an OTC medicine, as well as codeine labelling and dosage controls.^[15]

Concerns have been raised by some key stakeholders about the potential for the abuse of codeine made possible through its ready accessibility in OTC medicines, and the associated risks, including morbidity, toxicity and dependence, and related public health costs.

For these reasons, amongst others, proposals to up-schedule codeine-containing medicines to Schedule 4 were referred to the July 2015 meeting of the ACMS. Pre-meeting comments were invited from the public, and 60 submissions were received. On 1 October 2015, the Delegate made an Interim Decision to delete the current Schedule 2 and 3 entries for codeine and amend the current Schedule 4 and 8 entries to reflect these changes, effectively making codeine only available by prescription. The public was invited to provide further comments in response to the Interim Decision and 127 submissions were received. Subsequently, on 18 November 2015, the Delegate deferred a final decision on codeine scheduling to thoroughly consider the large number of submissions and to seek additional advice from the ACMS.^[16] An additional public consultation in December 2015 resulted in a further 49 submissions.

1.2 Objective

The objective of this report and the project that informed its development was to provide economic modelling and financial quantification of the regulatory, social and economic impacts of the proposed options for the rescheduling of codeine being considered by the ACMS. More specifically, KPMG's role was limited to providing the TGA with input for Impact Analysis (cost-benefit) and Regulatory Costing in order to satisfy the requirements of a Regulation Impact Statement (RIS). KPMG was not required to undertake an exhaustive review of the evidence/medical literature for or against the up-scheduling of codeine, as this is a policy consideration and is addressed in the RIS proper.

1.3 Approach

KPMG's approach to this task comprised two parallel but overlapping work streams: regulatory modelling, and economic modelling. As proposed by KPMG and agreed with the TGA, the approach consisted of the following activities:

Background research

• Desktop review of the Australian and International peer reviewed and other literature, publications and data sources to support development of the economic and social impact modelling in relation to the model's input variables including the following:
  • the rates of deaths and morbidity associated with low dose codeine combination medicines;
  • the comparative effectiveness in pain relief for low dose codeine combination medicines compared to paracetamol and/or ibuprofen without low dose codeine;
  • the number of people who purchase low dose codeine combination medicines: the proportion who use it chronically, and if used chronically, the proportion who are dependent;
  • the number of packs purchased; and
  • the Quality of Life Year (QALY) gains associated with improved treatment of chronic pain. 

Generalisability of overseas results to the Australian setting regarding the prevalence of dependent users was limited due to difference in the regulatory and clinical contexts.

Engagement with relevant government agencies

• Engagement with the Regulatory Engagement & Planning Branch, Health Products Regulation Group, Department of Health (DoH), so as to confirm scope; discuss and obtain feedback on progress; seek advice or direction regarding assumptions, qualifications and inputs; and communicate challenges. This included a workshop wherein regulatory touch points for the 5 regulatory options (noting that Option 1 entailed no change) were discussed and confirmed, and where it was agreed that there were four logical groupings of the six options, resulting in four potential scenarios (see Section 2.1).
• Engagement with relevant business units in DoH to discuss potential impacts and modelling of proposed options as follows:
  • Pharmaceutical Benefits Scheme (PBS). Potential increased costs due to additional prescription of PBS listed medicines in the case of up-scheduling to Schedule 4.
  • Medicare Benefits Schedule (MBS). Increased costs due to additional medical practitioner visits to obtain prescriptions in the case of up-scheduling to Schedule 4.
• Engagement with subject matter experts within the TGA to understand potential regulatory impacts and modelling of proposed options for OTC and prescription medicines.
• Two meetings with the OBPR to confirm proposed approach and seek advice or direction regarding assumptions, qualifications and inputs.

Interviews with industry

• KPMG initially conducted interviews with current sponsors of products on the Australian Register of Therapeutic Goods (ARTG) that had codeine as an active ingredient. The following pharmaceutical companies, which provided a cross-section of current sponsors of S2 and S3 medicines containing codeine on the ARTG, were interviewed:
  • Sandoz Pty Ltd - as a major provider of Schedule 2 and Schedule 3 (OTC) medicines containing codeine to the Australian market.
  • Sanofi-Aventis Australia Pty Ltd - as a major provider of Schedule 3 (OTC) and Schedule 4 (prescription only) medicines containing codeine to the Australian market.
  • GlaxoSmithKline Consumer Healthcare Pty Ltd - as a major provider of Schedule 2 and Schedule 3 medicines containing codeine to the Australian market.
  • Soul Pattinson Manufacturing Pty Ltd - as a major provider of Schedule 2 and Schedule 3 medicines containing codeine to the Australian market.
  • Johnson & Johnson Pacific - as a major provider of Schedule 2 and Schedule 3 medicines containing codeine to the Australian market.
• In preparation for these interviews, KPMG provided sponsors with background material and a list of questions for discussion (Annex F). Industry input contributed to the development of the regulatory costing model, allowed for the testing of baseline assumptions and gave some insight into anticipated supply and demand behaviour of market participants in response to the rescheduling options.

Interviews with peak bodies

• KPMG also participated in interviews with peak bodies in order to inform the development of the economic and social model. These interviews were with representatives from the:
  • Australian Medical Association (AMA) - as the peak body representing registered medical practitioners and medical students of Australia.
  • Pharmaceutical Society of Australia (PSA) - as the peak body representing pharmacists in Australia.
  • Australian Self Medication Industry (ASMI) - as the peak body representing companies involved in the manufacture and distribution of consumer healthcare products in Australia.

Development of regulatory and economic models

• The regulatory and economic models were developed in consultation with the OBPR, and were informed and guided by the background research, consultation with relevant government agencies and interviews mentioned above, as well as a range of primary data sources (discussed in greater depth in Section 1.4.).

1.4 Sources and manipulation of data

To inform the regulatory and economic modelling, data was sought from authoritative sources where possible, and was used to inform the logic of the regulatory and economic models, as well as the data inputs and assumptions for these models. Primary data sources are referenced throughout the report, and include:

• Australian Register of Therapeutic Goods (ARTG, August 2016): product name, formulation, sponsor (company) and manufacturer details of all therapeutic goods lawfully supplied in Australia.
• IMS Health (June 2013, supplied by TGA): product sales data.
• Pharmaceutical Benefits Scheme (PBS, August 2016, supplied by TGA): details of the medicines subsidised by the Australian Government.
• Medicare Benefits Schedule (MBS, August 2016, supplied by TGA): details of the Medicare services subsidised by the Australian Government.
• Public submissions to the TGA (May 2015 - January 2016): from interested members of the public, individual specialists (i.e. pharmacists and medical practitioners), pharmaceutical companies, representative / peak bodies, and other agencies.^[17]
• Confidential submissions to the TGA (May 2015 - January 2016, supplied by TGA): submissions as above, but not permitted for public release.
• Interviews (August 2016): see Section 1.3 for more detail.
• MedsASSIST (PGA, September 2016): the real-time recording and monitoring program established by the Pharmacy Guild of Australia to support patient safety and improve the clinical outcomes for medicines containing codeine.
• Academic literature concerning health effects of long-term codeine use.