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THERAPEUTIC GOODS AMENDMENT REGULATIONS 2008 (NO. 1) (SLI NO 117 OF 2008)
Therapeutic Goods Amendment Regulations 2008 (No. 1)
The Therapeutic Goods Administration (the TGA) carries out a range of assessment and monitoring activities to ensure therapeutic goods available in Australia are of an acceptable standard. It is required to fully recover its operating costs and achieves this in several ways including: by charging fees for the evaluation of applications to include medicines and medical devices in the Australian Register of Therapeutic Goods (the Register) or to amend details of products currently in the Register under the Therapeutic Goods Act 1989 (the TG Act); and by levying annual charges for products which are included in the Register under the Therapeutic Goods (Charges) Act 1989 (the Charges Act).
Subsection 63(1) of the TG Act provides that the Governor-General may make regulations, not inconsistent with the TG Act, prescribing matters required or permitted to be prescribed by the TG Act, or necessary or convenient to be prescribed for carrying out or giving effect to the TG Act. Paragraph 63(2)(h) of the TG Act provides that the regulations may prescribe fees in respect of matters under the TG Act or the regulations.
The purpose of the Regulations is to amend the Therapeutic Goods Regulations 1990 (the Principal Regulations) to increase, by 3.6 per cent, most fees to evaluate or amend the details of medicines which are required to be included on the Register. Certain specified fees increase by 10 per cent to curtail continuing under recovery of costs from industry fees over recent years.
The Regulations:
· increase the fees prescribed in regulation 45 and most fees specified in Part 2 of Schedule 9 to the Principal Regulations by 3.6 per cent, except as otherwise specified below;
· increase the annual wholesale turnover threshold below which the annual charge payable by persons with respect to certain licences in force in a financial year is reduced, by 3.6 per cent from $71,000 to $73,600; and
· increase certain application, processing and evaluation fees in Part 2 of Schedule 9 to the Principal Regulations by 10 per cent to curtail continuing under recovery of costs from industry fees over recent years.
The new fees have been rounded to the nearest ten dollars (for amounts less than ten thousand dollars) or one hundred dollars (for amounts greater than ten thousand dollars).
As a result of the TGA’s rounding policy, the following fees remain unchanged despite the 3.6 per cent increase:
· the fee for certificates issued under Schedule 9, Part 2, Item 10 of the Principal Regulations, which will remain unchanged at $120; and
· the fees for approval of advertisements for applications made under Schedule 9, Part 2, Items 17(a)(iv) and 17(c) of the Principal Regulations, which will remain unchanged at $90.
The Regulations when taken together with the changes to the Therapeutic Goods (Charges) Regulations 1990 and the Therapeutic Goods (Medical Devices) Regulations 2002 (which are the subject of separate Executive Council Minutes), are expected to increase the fees and charges collected by the TGA by $7.3 million over the 2008-09 financial year.
The increases enable the TGA to recover its costs in administering the Act and continue to meet the Government’s requirement that the TGA operate on a full cost-recovery basis.
An overview of the Regulations is at Attachment A, and details of those Regulations are set out in Attachment B.
The TGA consulted with industry associations, including Medicines Australia, the Generic Medicines Industry of Australia, the Australian Self-Medication Industry, the Complementary Healthcare Council of Australia, the Medical Technology Association of Australia, the Australian Dental Industry Association and AusBiotech on the proposed increases to charges. The consultations, convened between 12 and 29 February 2008, consisted of bilateral engagement with industry sectors and provided an opportunity for industry associations to examine and comment on the TGA Budget, including new initiatives and other budget measures, and on the proposed annual charges. The outcome of the consultations was that industry was generally supportive of the TGA proposals for 2008-09 fees.
The TG Act specifies no conditions that need to be met before the power to make the Regulations may be exercised.
The Regulations commence on 1 July 2008.
The Regulations are a legislative instrument for the purposes of the Legislative Instruments Act 2003.
ATTACHMENT A
OVERVIEW OF THE Therapeutic Goods Amendment Regulations 2008 (No. 1)
The increases to fees prescribed in regulation 45 and Part 2 of Schedule 9 of the Principal Regulations enable the TGA to recover its costs in administering the Act and continue to meet the Government’s requirement that the TGA operate on a full cost-recovery basis.
The 3.6 per cent increase to the fees prescribed in regulation 45 and to most fees prescribed in Part 2 of Schedule 9 has been calculated using a formula agreed with industry associations, which is comprised of 50 per cent of the annual Wage Cost Index (WCI) for the year ended December 2007 and 50 per cent of the Consumer Price Index (CPI) for the year ended December 2007.
Generally, significant changes to regulatory arrangements of new regulatory proposals involve additional consultation with affected sectors and result in the preparation of Cost Recovery Impact Statements (CRIS). A CRIS ensures that the TGA’s cost recovery arrangements are consistent with the Government’s Cost Recovery Guidelines for Regulatory Agencies issued in December 2002. The last full review of TGA’s cost recovery arrangements were undertaken in May 2005 and a CRIS was prepared. Subsequent CRIS’ have examined arrangements for the regulation of in-vitro diagnostic devices (March 2006); and the increases to annual charges for non prescription medicines (June 2006).
The TGA has significant (10 per cent) increases to specified medicines fees and charges to curtail continuing under recovery of costs from industry fees over recent years. As the increases exceed the current agreed rate of indexation they represent a material amendment to an existing cost recovery arrangement and require a CRIS to be prepared in accordance with Australian Government Cost Recovery Guidelines. A CRIS incorporating stakeholder views was completed and approved on 29 May 2008 and published on the TGA’s website. Regulations to increase certain medicines annual charges by 10 per cent are the subject of a separate Executive Council Minute.
The new fees have been rounded to the nearest ten dollars (for amounts less than ten thousand dollars) or one hundred dollars (for amounts greater than ten thousand dollars). As a result of the TGA’s rounding policy, the following fees will remain unchanged despite the 3.6 per cent increase:
· the fee for certificates (issued under Schedule 9, Part 2, Item 10 of the Principal Regulations) which will remain unchanged at $120; and
· the fees for approval of advertisements (for applications made under Schedule 9, Part 2, Items 17(a)(iv) and 17(c) of the Principal Regulations), which will remain unchanged at $90.
ATTACHMENT B
Details of the Therapeutic Goods Amendment Regulations 2008 (No. 1)
Regulation 1 provides for the Regulations to be referred to as the Therapeutic Goods Amendment Regulations 2008 (No. 1).
Regulation 2 provides for the Regulations to commence on 1 July 2008.
Items [1] and [2]
Regulation 45 of the Principal Regulations provides for the Secretary to waiver or reduce certain fees.
Subregulation 45(9) prescribes the fee payable for each application to register a therapeutic device (other than the principal application) to which subregulation (8) applies; whilst subregulation 45(11) prescribes the fee payable for each application to vary the written information (other than the principal application) to which subregulation (10) applies.
These items increase the fees applicable to register or vary a therapeutic device, respectively, in subregulations 45(9) and 45(11) of the Principal Regulations, by 3.6 per cent subject to the TGA’s rounding policy. These increases enable the TGA to recover its costs in administering the TG Act and continue to meet the Government’s requirement that the TGA operate on a full cost-recovery basis.
Item [3]
Subregulation 45A(1) of the Principal Regulations currently provides that the annual charges payable for a licence under the TG Act are reduced if the wholesale turnover of therapeutic goods in a financial year in relation to the person is less than $71,000. Item [4] (below), amends subregulation 45A(1) to increase this threshold by 3.6 percent (subject to the TGA’s rounding policy) from $71,000 to $73,600. Accordingly, this item amends the heading of regulation 45A to reflect this increase.
Item [4]
This item increases most fees applicable in Part 2 of Schedule 9 to the Principal Regulations by 3.6 per cent. The 3.6 per cent increase enables the TGA to recover its costs in administering the Act and continue to meet the Government’s requirement that the TGA operate on a full cost-recovery basis.
This item also increases specified medicines application, processing and evaluation fees, applicable, respectively, in paragraphs and items 2(a), 2(f), 2A(b), 3(b), 5(a), 5(b)(i)-(vii), 5(c), 5(d)(i)-(vii), 6D(a)-(g), 7A(a), 7A(b)(i)-(vii), 7B(a), and 7B(b)(i)-(vii) of Part 2 of Schedule 9 to the Principal Regulations, by 10 per cent to curtail continuing under-recovery of costs from industry fees over recent years.
Paragraph 2(ba) of Part 2, Schedule 9 to the Principal Regulations currently provides that the prescribed fee payable for an application to register certain medicines:
· where the Secretary of the Department of Health and Ageing considers that the application cannot be determined because of the insufficiency of information delivered by the applicant; or
· if the application is withdrawn before notification of acceptance of the application is sent by the Secretary;
is the lesser of 20 per cent of the relevant fee or $6,880.
This item increases the amount of $6,880 in paragraph 2(ba) of Part 2 of Schedule 9 by 3.6 per cent (subject to the TGA’s rounding policy) to $7,130. This increase enables the TGA to recover its costs in administering the Act and continue to meet the Government’s requirement that the TGA operate on a full cost-recovery basis.