Earlier this year there was a real threat that several major multiple sclerosis (MS) medicines could become much more expensive for Australian patients. Fortunately that crisis has now been averted.
The concern centred on three PBS-listed MS medicines: Ocrevus, Kesimpta and Lemtrada, when a pricing dispute developed between the Australian government and the manufacturers of these medicines, which significantly reduce disease activity by limiting damage to the brain and spinal cord.
The disagreement arose after a lower-priced MS drug, Briumvi, was added to the Pharmaceutical Benefits Scheme (PBS), triggering Australia’s ‘reference pricing’ system. Under that system, medicines considered to provide similar clinical benefits can be expected to move toward a similar government reimbursement price.
The manufacturers argued that the proposed reductions (reported to be around 40-50 per cent in some cases) were too steep. Had they refused to supply the medicines at the new PBS price and the drugs been removed from the PBS, patients could have faced private costs of around $33,000 per year for some treatments.
Following advice from the independent Pharmaceutical Benefits Advisory Committee (PBAC), Health Minister Mark Butler announced in mid-July that Ocrevus, Kesimpta and Lemtrada would remain on the PBS, with patients continuing to receive them at normal PBS prices (which have become cheaper since January 2026).
Mr Butler says a rapid review of MS treatments and their PBS arrangements will be completed by the end of 2026, to determine a longer-term solution.
More broadly, this dispute has highlighted growing tension between Australia’s PBS pricing system, which aims to keep medicines affordable for taxpayers, and pharmaceutical companies, which argue that some price reductions make it commercially difficult to continue supplying certain drugs in Australia.
Similar pricing disputes have also affected medicines for other conditions.
Was it Donald Trump’s fault?
Although the MS drug crisis in Australia wasn’t directly caused by the Trump administration pressuring Australia to change its PBS, the broader international environment has made these kinds of disputes increasingly likely.
Under Trump, the USA has repeatedly criticised countries, including Australia, for paying lower prices for medicines than the United States. It has promoted ‘Most Favoured Nation’ pricing and has also considered trade measures against countries whose pharmaceutical pricing systems are seen as disadvantaging US drug companies.
American pharmaceutical manufacturers have long argued that the PBS undervalues innovative medicines, and those concerns are becoming more prominent.
When the Trump administration pressures the pharmaceutical industry to maintain higher global prices, drug companies become more reluctant to accept deep price cuts in countries like Australia. That makes pricing negotiations with the PBS more difficult. As a result, disputes such as the MS medicines case become increasingly likely.
Unfortunately, these disputes aren’t just about money. People’s lives are at stake.
