Medicines listed on the Pharmaceutical Benefits Scheme (PBS) are about to become even more affordable. Under legislation introduced to Parliament in July 2025, the maximum cost of a general PBS prescription will drop to $25 from 1 January 2026, down from $31.60 (Health Department media release). This reform builds on earlier initiatives such as 60‑day prescriptions and the largest cut to PBS prices in the scheme’s history (Health Department media release). For community pharmacists, the changes will reshape dispensing patterns, patient affordability and the range of treatments they provide.
This article explains the upcoming PBS co‑payment reduction, highlights new medicines being added to the PBS and explores what these reforms mean for pharmacists and their patients. It draws on the federal Budget announcement, a Pharmacy Guild media release and official government statements to bring pharmacists a concise and practical overview.
Key Summary
- Co‑payment reduction: From 1 January 2026, the general patient co‑payment for PBS medicines will be capped at $25 per prescription (Health Department media release). This is a cut of more than 20 %, saving Australians over $200 million each year (Health Department media release).
- Investment in cheaper medicines: The 2025–26 Budget allocates $3.2 billion to make medicines even cheaper. Of this, $689.1 million funds the co‑payment reduction, $1.8 billion supports new and amended PBS listings, and $564.1 million underwrites a new Pharmaceutical Wholesaler Agreement (see the Budget PDF).
- Support for concession card holders: The concessional co‑payment remains frozen at $7.70 until 2030, and a 25 % reduction in prescriptions needed to reach the PBS Safety Net will remain in place (Health Department media release).
- New PBS listings: A suite of medicines for women’s health, cancer, lung disease, Cushing’s syndrome and psoriatic arthritis will be added to or expanded on the PBS. These include contraceptives (Yaz®, Yasmin®, Slinda®), menopause hormone therapies (Estrogel®, Prometrium®, Estrogel® Pro), endometriosis treatment (Ryeqo®), IVF medication (Pergoveris®), cancer therapies such as talazoparib and olaparib and treatments like selpercatinib for rare lung cancer (Budget PDF).
- Pharmacy trials for women’s health: Two national trials will allow about 250,000 women with concession cards to obtain oral contraceptives and treatment for uncomplicated urinary tract infections directly from pharmacists (Budget PDF).
Summary note: This article covers the PBS co‑payment reduction to $25, the Budget’s investment in new PBS listings, impacts on community pharmacy, and practical examples of how these reforms will affect prescribing and patient care. It also highlights the opportunities for pharmacists to support patients with new women’s health initiatives and the ongoing PBS Safety Net reforms.
Budget 2025–26: Cheaper Medicines
The 2025–26 Budget commits $3.2 billion to further reduce the cost of medicines. The headline announcement is a co‑payment cut from $31.60 to $25 for people with a Medicare card and no concession card. According to the government, this will be the first time general PBS prices have fallen below $25 since 2004 (Health Department media release). Patients who previously paid $31.60 per script could save around $79 per year, while families filling four prescriptions a month may save more than $316 a year (see the Budget PDF).
Reducing the co‑payment is just one part of the package. The Budget also provides $1.8 billion to fund new and amended PBS listings and $564.1 million for the first Pharmaceutical Wholesaler Agreement. This agreement includes a 34 % funding increase for medicine wholesalers to ensure reliable access to PBS medicines for all Australians and sets aside funds to manage shortages and support highly specialised drugs programmes (see the Budget PDF).
Health Minister Mark Butler emphasised that the reform will save Australians over $200 million annually and delivers tangible cost‑of‑living relief (Health Department media release). He also noted that the government has previously frozen PBS prices for concession card holders at $7.70 until 2030 and introduced 60‑day prescriptions, giving patients longer supplies and fewer dispensing fees (Health Department media release).
What the Changes Mean for Community Pharmacists
More affordable medicines and higher volumes
For pharmacists, the reduction in co‑payments will likely increase dispensing volumes and encourage adherence. When medicines are more affordable, patients are less likely to skip doses or delay refills. As Professor Trent Twomey of the Pharmacy Guild noted, community pharmacists often see patients forced to choose between medications and essentials like rent or groceries (Pharmacy Guild media release). Bringing the co‑payment down to $25 helps ease those tough decisions.
The legislation also protects pharmacies’ ability to discount prescriptions. Medicines that can be discounted today will continue to be discounted once the co‑payment falls to $25 (Health Department media release), preserving competition and flexibility for pharmacies.
Expanded clinical services and trials
The Budget includes two national trials allowing women with a concession card to obtain oral contraceptives and treatment for uncomplicated urinary tract infections directly from pharmacists (see the Budget PDF). Around 250,000 women are expected to benefit, highlighting growing recognition of pharmacists as primary health providers. States and territories are also expanding pharmacists’ scope to manage everyday conditions such as school sores, earache and uncomplicated UTIs (Pharmacy Guild media release), freeing up GPs to focus on more complex cases.
Supply chain stability
The new Pharmaceutical Wholesaler Agreement delivers billions to ensure medicines distributed under the PBS remain affordable despite rising logistics costs. It guarantees access to PBS medicines from every community pharmacy, funds solutions to address medicine shortages and supports highly specialised drug programmes (see the Budget PDF). Pharmacists can be confident that supply chain pressures and rising transport costs will not translate into higher prices for patients.
New PBS Listings: Women’s Health and Beyond
A significant portion of the Budget’s $1.8 billion for new PBS listings focuses on women’s health. The oral contraceptive pills Yaz® and Yasmin® are now listed—marking the first new types of oral contraceptives in decades. Around 50,000 women each year who previously spent up to $380 will now pay about $126.40 a year, dropping to $100 from 1 January 2026, or just $30.80 with a concession card (Budget PDF). The progestogen‑only pill Slinda® is also being listed, benefiting women who cannot take oestrogen and reaching around 100,000 women.
The listing of Ryeqo®—a combination of relugolix, estradiol and norethisterone—will save around 8,500 women more than $2,300 a year. It provides a new treatment option for moderate to severe endometriosis when other therapies fail (Budget PDF). Menopause therapies are also expanding: estradiol (Estrogel®), progesterone (Prometrium®) and a combination estradiol and progesterone gel (Estrogel® Pro) are listed on the PBS for the first time in more than 20 years. About 150,000 women will save up to $290 a year, or $577 with a concession card, with these treatments (Budget PDF).
The reforms go beyond reproductive health. Early‑cycle IVF patients will gain access to the combination therapy Pergoveris®, with the PBS covering up to four pens per script—double the previous limit. Without subsidy, four pens would cost over $3,500 (Budget PDF). For oncology, the PBS will list or expand access to several life‑saving drugs: talazoparib (Talzenna®) for metastatic prostate cancer, olaparib (Lynparza®) for women with HER2‑negative metastatic breast cancer and BRCA mutations, selpercatinib (Retvemo®) for a rare form of non‑small cell lung cancer, osilodrostat (Isturisa®) for endogenous Cushing’s syndrome and risankizumab (Skyrizi®) for severe psoriatic arthritis. These treatments can cost tens or hundreds of thousands of dollars per course without subsidy; PBS listing dramatically reduces out‑of‑pocket costs (Budget PDF).
Case Study: How One Patient Will Benefit
The Budget document includes a case study that illustrates how the co‑payment reduction and 60‑day scripts can improve affordability. Ritesh is a 45‑year‑old woman from Launceston who uses the PBS medicine Estrogel® to treat menopause. Without a concession card she currently fills 12 prescriptions a year at $31.60 each, costing $379.20 annually. When the co‑payment drops to $25 on 1 January 2026 she will pay $300 per year, saving $79.20. Because Estrogel® is eligible for a 60‑day prescription, switching to a double‑supply script would further reduce dispensing fees by around $150 each year (Budget PDF). For pharmacists, this case underscores the value of advising patients on longer scripts and helping them navigate the new pricing schedule.
Conclusion
The 2025–26 Budget delivers on the government’s promise to make medicines more affordable. Reducing the PBS general co‑payment to $25, expanding the list of subsidised medicines and investing in the supply chain will provide tangible relief for patients and open new opportunities for pharmacists. As trusted health professionals, pharmacists can play a central role in explaining these changes, encouraging adherence and supporting patients to access new treatments.
By staying informed about the latest PBS reforms—including the co‑payment reduction, 60‑day prescriptions and new medicine listings—pharmacists can ensure they are ready to answer questions, optimise stock management and contribute to better health outcomes for their communities.
Disclaimer: This blog is intended as a general overview of the topic and should not be construed as professional legal or medical advice.
FAQs
- When will the PBS co‑payment be reduced to $25?
The reduction takes effect on 1 January 2026. From that date, general patients will pay no more than $25 for a PBS prescription (Health Department media release).
- Will concession card holders also see changes?
Concession card holders already pay a lower co‑payment. The government has frozen this at $7.70 until 2030 and reduced the number of scripts needed to reach the PBS Safety Net (Health Department media release).
- How do 60‑day prescriptions work?
Eligible medicines can be dispensed in 60‑day quantities, meaning patients receive double the usual supply for a single dispensing fee. This initiative, introduced in phases from September 2023, reduces the number of pharmacy visits and lowers out‑of‑pocket costs (Health Department media release).
- What new medicines are being added to the PBS?
New and expanded listings include oral contraceptives (Yaz®, Yasmin®, Slinda®), menopause hormone therapies (Estrogel®, Prometrium®, Estrogel® Pro), treatments for endometriosis (Ryeqo®), early‑cycle IVF (Pergoveris®), cancer therapies such as talazoparib, olaparib, and selpercatinib, and drugs for Cushing’s syndrome and psoriatic arthritis. See the Budget PDF for details.
- What is the Pharmaceutical Wholesaler Agreement?
The Agreement provides billions of dollars to ensure medicines distributed under the PBS remain affordable despite rising logistics costs. It includes funding to manage medicine shortages and supports highly specialised drug programmes (Budget PDF).
