Source: PHARMAC
8
Progress is made on implementing recommendations from the Board commissioned external reviews into workplace culture and consumer engagement. This should include initiatives such as a consumer reference group.
Accelerated and ongoing
We initiated the 12-month Reset Programme with the aim of supporting Pharmac to be a more outward-focused and transparent organisation that values and actively engages with consumers and stakeholders. We established a Consumer and Patient Working Group to provide consumer insight and advice to the Reset Programme, ensuring the consumer community is actively engaged and diverse views are represented.
The chair of the Consumer and Patient Working Group, Dr Malcolm Mulholland, was nominated and selected by members of the wider consumer and patient community and endorsed by the Pharmac Board.
The working group consisted of up to 10 consumer and patient community members, including the Chair, reflecting the breadth and diversity of communities impacted by Pharmac’s work, including under-represented voices.
To deliver the programme effectively, we used a 90-day plan approach to focus on improvements, actions and change. Progress was reported publicly on our website.
One of the key actions from the Culture Review report was the development of a compelling new organisational vision and establishing measurable strategic objectives. This was completed during the year supported by significant external and internal engagement.
Other activities that were progressed during the year included work on governance, finance and performance; systems, data and digital transformation; workforce, capability and ways of working; and legal, policy and corporate governance.
This expectation is not included in the 2026/27 Letter of Expectations.
Whilst not a specific expectation for 2026/27 many of the recommendations for improvement are captured as part of Pharmac’s planned deliverables in 2026/27.
9
A new vision and strategy is developed that supports the organisation to be more outwardly stakeholder focused including ensuring this is reflected in the annual Statement of Performance Expectations, and a revised Statement of Intent by June 2026.
Completed
A new vision and strategy were developed and agreed by the Pharmac Board in May 2026.
Our annual 2026/27 Statement of Performance Expectations, and a revised 2026/27 – 2029/30 Statement of Intent were completed in June 2026 and published on our website.
This expectation is not included in the 2026/27 Letter of Expectations.
The SPE is an annual statutory document required under the Crown Entities Act 2004. We will develop the 2027/28 SPE over the coming year, with completion scheduled for June 2027.
10
Pharmac is investing in data and digital infrastructure to enhance core functions and improve decision making, collaboration and transparency.
Accelerated and ongoing
We have used one-off funding provided in Budget 2025 to develop a two-year data and digital programme.
The first and key project underway is the redevelopment of the Pharmaceutical Schedule (the Schedule). The project replaces the legacy Schedule applications and implements a modern, centralised Schedule database and integrates with other systems internally and externally. This represents the most significant change to the Schedule in the last 30 years.
As part of this project, we have agreed a joint project plan with Health NZ to align delivery of the Schedule with the new Special Authority IT system they are delivering. A go-live date for both systems is scheduled for late October 2027.
Discovery and Design Phase underway for a new contract management system; the development of patient & supplier portals; and improved application development tools to improve workflow. We are also exploring opportunities for use of AI across Pharmac’s work.
This expectation continues under the “Continuous improvement of organisational culture and capability” theme.
Our focus will be continued delivery of our Data and Digital programme working in partnership with Health NZ and other sector stakeholders.
11
Pharmac continues to contribute to the Government’s health priorities including:
- The Government Policy Statement on Health 2024-2027 (GPS).
- National health targets.
- New Zealand Health Plan and associated Pae Ora strategies.
Ongoing
We gave effect to relevant actions outlined in the GPS and supported delivery of targets across priority areas where applicable. The three actions specific to Pharmac in the GPS were:
- improve the availability of and access to cancer medicines in New Zealand.
- enable faster access to medicines by improving the timeliness of processes related to accessing new medicines.
- continue to develop Pharmac’s model to ensure patient voice and wide-ranging societal consequences are taken into account.
Government priorities have been incorporated in our 2026/27 – 2029/30 Statement of Intent and 2026/27 Statement of Performance Expectations.
This expectation continues under the “Continuous improvement of organisational culture and capability” theme.
Pharmac will give effect to relevant actions in the GPS and support, where relevant, delivery of targets and actions across priority areas.
The Government is scheduled to complete a new three-year GPS by June 2027, and we will contribute to GPS development.
12
Pharmac’s work gives effect to the Cabinet Circular (24) 5: Needs-based Service Provision, to meet the Government’s expectations for how the targeting, commissioning and design of public services should be based on the needs of all New Zealanders.
Ongoing
We formalised our Access Criteria policy which guides how we set access criteria within the Pharmaceutical Schedule. The new approach ensures that the target patient population are clearly defined from the outset and broad descriptive criteria are set to ensure everyone in the target group will have access to medicines.
The Access Criteria policy fulfils government expectations as set out in the Cabinet Circular (24) 5 on need-based service provision.
We revised other policies and procedures to ensure alignment with Cabinet Circular, including a revised Equity Policy.
This expectation continues under the “Continuous improvement of organisational culture and capability” theme.
We will continue to strengthen implementation and understanding of our Access Criteria Policy.
We are currently reviewing the access criteria for medicines where there are ethnicity-based criteria, with a view to removing or replacing them with clinical criteria where possible.
13
Pharmac is delivering the agreed outcomes from the medical devices review including working collaboratively with the Ministry of Health, Health New Zealand, medical devices industry and other stakeholders.
Accelerated and ongoing
In September 2025, the Government announced changes to how hospital medical devices are procured. Under this joint approach, Health NZ and Pharmac share responsibility focusing on the areas that best align with its expertise and capabilities. Ministers issued a joint letter of expectations (LoE) to both agencies outlining 11 expectations for joint work.
At the end of March 2026, the Ministry of Health completed its six-monthly report to Ministers on the progress of the joint partnership between Pharmac and Health NZ, confirming that implementation remains on track and that the collaborative operating model is bedding in well. The report highlights the increasing clarity around roles, improved coordination across workstreams, and the steady progress being made on procurement, category planning, and contract transitions
A cross-agency oversight group oversees implementation, monitors performance, resolves issues, and ensures alignment procurement with system priorities.
This expectation continues under the “Continuous improvement of organisational culture and capability” theme.
Our focus for the year ahead to ensure delivery of the joint LoE, is to progress a coordinated programme of work with Health NZ, focused on operational transition and system readiness. This will include:
- delivering a joint transition plan covering contract ownership changes.
- establishing a shared procurement pipeline, agreed processes and timeframes.
- strengthening the benefits and value measurement framework.
- ensuring consistent and coordinated approaches to supplier engagement, communications and relationship management including establishment of a Supplier Reference Group.
- supporting Device Advice and Assessment Pathway using Health Technology Assessment.
Original source: https://nz.mil-osi.com/2026/08/13/2025-26-pharmac-letter-of-expectations-progress-update-july-2026/