The cost of an expensive anti-HIV drug is set to drop below $500 a year after it was approved for addition to the Pharmaceutical Benefits Scheme.
PrEP is a once-daily pill used to prevent HIV transmission particularly among gay and bisexual men, and its cost will drop from $5000 a year.
The Pharmaceutical Benefits Advisory Committee on Friday recommended listing the pill on the PBS and the government has reportedly promised to make the addition official.
"Gay and bisexual men continue to carry the greatest burden of HIV in Australia, and we expect that PrEP will sharply drive down rates of HIV for this community," Australian Federation of AIDS Organisations chief executive Darryl O'Donnell said on Friday.
The drug is 99 per cent effective at preventing HIV transmission, and it was approved for use in Australia in May 2016.
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Mr O'Donnell said a single averted HIV transmission saves the Australian taxpayer $1 million in lifetime costs.
"Making PrEP available and affordable is not only a public health goal, it will also save millions of dollars," he said.
