It shouldn’t surprise us that everyone involved in healthcare – the Medical Council, Medsafe, Pharmac, the DHBs, pharma companies (and of course the poor old patients themselves) says they want the same thing: better outcomes for patients. Or should it?

Let’s think about the goals that some of these players have: Pharmac is one of the health system’s main cost-control points. Medsafe focuses on safety and efficacy. Patients really do want better health outcomes, while pharma companies – well! We’ll get to them. Though these goals may overlap, they’re not identical, and they don’t line up neatly to show an overarching, uniform interest in better patient outcomes.

We should be open about these interests, and we should recognise that they complement each other. Overall, New Zealand needs a system in which the pursuit of many complementary self-interests gives the best overall outcome possible. We don’t achieve that by persuading players to modify their own self-interest, but by regulating the framework within which each self-interest is pursued.

What does this mean in practice? Think of pharmaceutical companies, for example: notoriously, they pursue profit. But they are market creatures in a market economy, and to criticise them for seeking shareholder returns is like criticising a jaguar for being a carnivore: in the ecosystem in which they live, they cannot be other than they are.

The implication? If you want pharma companies to lower medication prices, the answer is not to appeal to them to be less rapacious, or more compassionate. The answer is to modify the framework within which they pursue their goal – by introducing fixed-reference pricing, or (as Pharmac has done so successfully that it has driven most of the larger companies offshore) by bundling an entire country’s purchasing power, and using that as a bargaining lever).

Claiming that everyone’s overarching goal is better outcomes for patients is woolly-headed. It leads to ineffectual exhortations, to misdirected energy, and to an inability to see, clear-eyed, where the true levers for change really are.

AuthorNicola Rowe