A drug that can prevent people from contracting HIV will receive funding from Pharmac.
Pre-exposure prophylaxis (PrEP) is a medication that can reduce users' risk of contacting the HIV virus by more than 90 percent.
Pharmac announced on Wednesday that it will fund PrEP under the brand name Truvada from March 1. The pill is a combination of anti-viral drugs emtricitabine and tenofovir disoproxil fumarate, and is designed to be taken daily.
New Zealand will be one of the first countries in the world to publicly fund PrEP for HIV prevention, which was one of the Labour Party's election promises.
Pharmac already funds PrEP to treat those already infected with HIV, but it will now extend funding to people at a high risk of contracting HIV, which could be up to 4000 Kiwis.
Pharmac Chief Executive Sarah Fitt said in a statement that while the funding decision should significantly reduce the country's HIV transmission rates, safe sex, early diagnosis and access to treatment were still vital to keeping people safe.
"Condoms continue to be the primary and recommended method of preventing transmission of HIV and other sexually transmitted infections."
She said that even though condoms are free by prescription and are highly effective, HIV infection rates are still rising in New Zealand.
To be eligible for PrEP, people will have to undergo regular testing for both HIV and other sexually transmitted infections. They will also receive advice on how to reduce their risk of infection.