Non-Pharmac drugs in NZ: What they cost, and how insurance can help

How health insurance can help cover the cost of non-Pharmac drugs

Non-Pharmac-funded medications in New Zealand can cost many thousands of dollars. Private health insurance helps you access and pay for these medications, including the costs of specialised cancer treatments and immunotherapies not available through the public system.

Amounts payable for non-Pharmac-funded drugs (surgical and medical treatment) on selected health insurance plans

• Accuro (SmartCare+): Up to $500,000* per year
• AIA (Private Health): Up to $500,000 per year (chemotherapy and immunotherapy only)
• nib (Ultimate Health Max): Up to $600,000* per year
  • You can also get additional non-Pharmac cover with the non-Pharmac Plus option (choose between $20,000, $50,000, $100,000, $200,000, $300,000)

• Partners Life (Private Medical Cover): Up to $600,000 per year
• Southern Cross (Wellbeing): Up to $10,000 per year (chemotherapy only)
  • Option to upgrade to Cancer Cover Plus for higher chemotherapy cover
  • Choose between Chemotherapy 100 or Chemotherapy 300:
    • Chemotherapy 100 – up to $100,000 per claims year, with no sub-limit on non-Pharmac, Medsafe-indicated chemotherapy drugs
    • Chemotherapy 300 – up to $300,000 per claims year, with no sub-limit on non-Pharmac, Medsafe-indicated chemotherapy drugs.

^{*Up to the hospital surgical or medical benefit, whichever applies.}

The value of these benefits far exceeds what you’ll pay for your health insurance.

Other insurance plans that can help pay for unfunded drugs

Health insurance is not the only option. There are other types of insurance which pay out lump sums or regular instalments to help cover unfunded or non-Pharmac drugs, private treatment, or living costs.

Some of the main options include:

• Trauma insurance (critical illness cover): Pays a lump sum if you are diagnosed with a serious condition listed in the policy, such as cancer, heart attack, or stroke. The sum is paid soon after diagnosis and can be used to help fund treatment not covered elsewhere.
• Cancer insurance: There are a few options, depending on the level of support you want. Standalone cancer cover pays a lump sum on diagnosis, usable for private treatment, non-Pharmac drugs, overseas care, or lost income. Cancer cover linked to life insurance triggers a payout that reduces your remaining life cover, while keeping the policy active for your family later. Cancer cover for actual costs reimburses specific expenses (consultations, surgery, chemotherapy, recovery support) rather than paying a single lump sum.
• Total and permanent disability (TPD) cover: Pays a lump sum if you become totally and permanently disabled and are unlikely to work again. The payout can help cover long-term medical costs, including expensive or ongoing unfunded medications.
• Income protection insurance: Provides a regular monthly payment if illness or injury stops you from working. While not a lump sum, it frees up cash flow so you can afford unfunded drugs alongside your everyday expenses.
• Mortgage protection cover: Pays a regular amount if you cannot work due to illness or injury. It helps you keep up with bills, treatment, and medication.

The right mix of cover makes a big difference when health issues strike. Policywise helps you understand which options ease financial stress when you’re faced with a serious medical condition. Get in touch to talk through your situation and explore cover that fits your needs and budget.

Unfunded drugs in New Zealand

Pharmac currently subsidises over 2,000 drugs and medical products. But budget constraints and the exorbitant costs of some drugs (see their prices below) prevent the agency from funding many more medicines approved by Medsafe for use by Kiwis.

In a report from Pharmac for the first quarter of 2025, 200 applications were still waiting for approval. These unfunded medicines include treatments for:

• asthma
• basal cell carcinoma
• cardiovascular diseases
• cervical cancer
• colorectal cancer
• Crohn’s disease
• cystic fibrosis
• diabetes
• hypercalcaemia
• leukaemia
• lung cancer
• lymphoma
• multiple sclerosis
• spinal muscular atrophy
• osteoporosis
• arthritis
• gout
• myeloma
• ovarian, fallopian tube, or primary peritoneal cancer
• pancreatic cancer
• prostate cancer
• renal cancer
• ulcerative colitis.

New Zealand has the smallest number of registered and publicly-funded modern medicines as compared with 20 other OECD countries. Of the 447 modern medicines launched in OECD-20 countries, only 24 (5%) were funded in New Zealand, vs an average of 157 (33%) in other OECD countries. From 2011 to 2020, New Zealand held the lowest ranking, limiting access to the latest treatments for cancer and other chronic diseases.

Number of publicly-funded modern medicines in NZ and selected comparator OECD countries 2011–2020

Source: IQVIA (Commissioned by Medicines New Zealand) November, 2021. ‘ A Decade of Modern Medicines: An International Comparison 2011 – 2020’.

• New Zealand did not publicly fund new modern medicines for arthritis, diabetes, and mental health during this time period.
• The country also had among the lowest numbers of publicly-funded modern treatments for cancers, cardiovascular diseases, hepatitis C and rare diseases.

Percentage of modern medicines (first registered and launched in the OECD-20 2011–2020) publicly funded in key therapy areas, by country.

Source: IQVIA (Commissioned by Medicines New Zealand) November, 2021. ‘A Decade of Modern Medicines: An International Comparison 2011 – 2020’.

Status of Pharmac applications

The status of applications waiting for Pharmac funding at the time of writing:

• 159 under ‘Options for investment’: These are applications that will be funded if there is available budget.
• 70 under ‘Only if cost neutral or cost saving’: These may be funded if Pharmac can generate cost savings or get the medicine at the same price as a currently funded drug.
• 111 under ‘Recommended for decline’: Clinical experts have recommended declining these applications.

Until the government has the budget to cover more medications, you can be proactive about protecting yourself and your loved ones in the event of severe medical issues.

Buying appropriate health insurance broadens your treatment options from publicly funded drugs to other, potentially more effective but unfunded, Medsafe-approved treatments.

You can also avoid waiting times at public hospitals and choose to get faster treatment in private facilities.

The cost of non-Pharmac-funded drugs (and their administration) in NZ

Want to know how much non-Pharmac drugs cost?

Below are some life-extending medications and treatments still under application for Pharmac funding, plus their estimated costs.

Some of these have been on Pharmac’s list for over six years.

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Get expert help choosing health insurance and other types of cover

Instead of limiting your choices to what a single insurer offers, Policywise compares plans from New Zealand’s top health insurers and shows you the ones that offer the best cover for your circumstances, at the best price.

Don’t leave your own and your loved ones’ health and finances to chance.

The time to get medical insurance is when you and your family are in reasonable health and with no ongoing medical conditions that may affect your insurance cover.

But if you do have pre-existing conditions, we can help you find and compare insurance policies that cover your current health concerns.

Book a meeting with a Policywise adviser to learn more about non-Pharmac-funded drug cover and insurance options.