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THERAPEUTIC GOODS AMENDMENT REGULATIONS 2007 (NO. 1) (SLI NO 161 OF 2007)
Therapeutic Goods Amendment Regulations 2007 (No. 1)
The object of the Therapeutic Goods Act 1989 (the Act) is to establish and maintain a national system of controls for the quality, safety and efficacy and timely availability of therapeutic goods that are used in Australia or exported from Australia. The Therapeutic Goods Administration (the TGA) is responsible for administering the Act.
Subsection 63(1) of the Act provides that the Governor-General may make regulations, not inconsistent with the Act, prescribing matters required or permitted to be prescribed by the Act, or necessary or convenient to be prescribed for carrying out or giving effect to the Act.
Paragraph 63(2)(h) of the Act provides that the regulations may prescribe fees in respect of matters under the Act or the regulations. Part 2 of Schedule 9 to the Therapeutic Goods Regulations 1990 (the Principal Regulations) sets out the table of fees payable under the Act.
Paragraph 63(3)(b) of the Act provides, in part, that the regulations may also provide for the reduction of fees relating to medicines, therapeutic devices and manufacturing licences, in cases identified in the regulations. Regulation 45 of the Principal Regulations provides that the Secretary of the Department of Health and Ageing may waive or reduce fees specified in Schedule 9 to specified amounts under certain circumstances.
The purpose of the Regulations is to increase most fees payable under the Act by 4.0 per cent, introduce a new desk audit fee for assessing overseas manufacturing compliance, and vary certain specified fees as described below.
The Therapeutic Goods Amendment Regulations 2007 (No. 1):
· increases the fees prescribed in regulation 45 and in Part 2 of Schedule 9 to the Principal Regulations by 4.0 per cent, except as otherwise specified below;
· increases, at subregulation 45A(1) of the Principal Regulations, the annual wholesale turnover threshold from $68,300 to $71,000, at which the annual charge for a licence to manufacture therapeutic goods is reduced, and applicable to a person required to hold such a licence;
· decreases the evaluation fees for most prescription medicines by up to 4.5 per cent (this change relates to prescription medicines that are registered on the Register);
· introduces a new $1,500 fee for the evaluation of technical documentation to be conducted in Australia, in-lieu of an initial and more costly overseas audit of manufacturing premises by Australian Good Manufacturing Practice (GMP) auditors. This technical documentation relates to overseas manufacturing compliance certifications that were issued by overseas regulators; and
· aligns similar or like fees applying to medicines and therapeutic devices which have little or no effect on cost recoveries. Australian Register of Therapeutic Goods (ARTG) reinstatement fees will be adjusted to $480 (per invoice). Application and processing (variation) fees for therapeutic devices will be adjusted to $330 (this change relates to goods that are registered or listed on the Register). Regulations that align fees for medical devices included on the Register are the subject of a separate Executive Council Minute.
The new fees have been rounded to the nearest ten dollars (for amounts up to ten thousand dollars) or one hundred dollars (for amounts of ten thousand dollars or more). An exception to the rounding is the fee increase for item 10 of Part 2 of Schedule 9 (the fee noted at item[7]) which increases the fee for an application for certification under paragraph 58 (3) (a) of the Act from $110 to $120. This fee increase has been made because, if the rounding policy were applied strictly in the case of a 4.0 per cent increase to the current fee of $110, the resulting amount ($114.40) would revert to its current level.
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 $5.542 million over the 2007-2008 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 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 2007.
The Regulations are a legislative instrument for the purposes of the Legislative Instruments Act 2003.
ATTACHMENT A
OVERVIEW OF THE Therapeutic Goods Amendment Regulations 2007 (No. 1)
The increases to fees prescribed in regulation 45 and Part 2 of Schedule 9 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 4.0 per cent general increase applied to most fees prescribed in regulation 45 and 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 2006 and 50 per cent of the Consumer Price Index (CPI) for the year ended December 2006.
The Regulations also reduce evaluation fees for most prescription medicines by up to 4.5 per cent in line with a plan to restructure the fee schedule agreed with industry in July 2003. Fees for the evaluation of generic medicines and fees associated with major clinical trials (CTX) remain unchanged. The Regulations to increase the annual charges for the registration of prescription medicines by 17 per cent are the subject of a separate Executive Council Minute. The overall change in total cost recovery regarding prescription medicines as a result of the Regulation will be an increase of around 7.5 per cent, with 65 per cent of revenue being raised from application and evaluation fees (pre-market activities) and 35 per cent from annual registration charges (post market activities).
The Regulations also introduce a new fee for the conduct of a desk audit assessment of documentation relating to overseas manufacturing compliance certifications that were issued by overseas regulators (in-lieu of an initial and more costly overseas audit by Australian GMP auditors. The desk audit assessment fee will be charged (as applicable) in addition to the processing of data in relation to goods, a step in the manufacture of which was carried outside Australia to determine whether the manufacturing and quality control procedures used in the manufacture of goods for the purposes of the Therapeutic Goods Act 1989 is acceptable. The desk audit assessment fee will be included in the Part 2 of Schedule 9 of the Therapeutic Goods Regulations 1990.
The new fees have been rounded to the nearest ten dollars (for amounts up to ten thousand dollars) or one hundred dollars (for amounts of ten thousand dollars or more). An exception to the rounding is the fee increase for item 10 of Part 2 of Schedule 9 (the fee noted at item[7]) which increases the fee for an application for certification under paragraph 58 (3) (a) of the Act from $110 to $120. This fee increase for Item 10 of Part 2 of Schedule 9 has been made because, if the rounding policy were applied strictly in the case of a 4.0 per cent increase to the current fee of $110, the resulting amount ($114.40) would revert to its current level.
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 Industry Association of Australia, the Australian Dental Industry Association and AusBiotech on the increases to fees. The consultations, convened between 13 and 23 February 2007, consisted 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 charges. The outcome of the consultations was that industry was generally supportive of the TGA proposals for 2007-08 charges.
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).
As the recommended increases are in line with the agreed rate of indexation agreed with industry, a cost recovery impact statement is not required.
ATTACHMENT B
Details of the Therapeutic Goods Amendment Regulations 2007 (No. 1)
Regulation 1 provides for the Regulations to be referred to as the Therapeutic Goods Amendment Regulations 2007 (No. 1).
Regulation 2 provides for the Regulations to commence on 1 July 2007.
Item [1]
This item increases the fees applicable in paragraphs 45(4A)(a), 45(4A)(b), (c), and (ca), 45(4A)(d), 45(4A)(e) and (f), and subregulations 45(9) and 45(11) of the Principal Regulations, by approximately 4.0 per cent. These increases enable the TGA to recover its costs in administering the Therapeutic Goods Act 1989 (the Act) and continue to meet the Government’s requirement that the TGA operate on a full cost-recovery basis.
Items [2] and [3]
Subregulation 45A(1) of the Principal Regulations currently provides that the annual charges payable for a licence the Act are reduced if the wholesale turnover of therapeutic goods in a financial year in relation to the person is less than $68,300. Item [3] amends subregulation 45A(1) to increase this threshold from $68,300 to $71,000, and item [2] amends the heading of regulation 45A to reflect this increase.
Items [4] to [6]
A new $1,500 fee item is introduced to for the conduct of a desk audit of technical documentation relating to overseas manufacturing compliance certification that were issued by overseas regulators, in lieu of an initial and more costly overseas audit of manufacturing premises by Australian GMP auditors. The desk audit fee will be charged (as applicable), in addition to the processing of data provided by the applicant for the purpose of including the goods in the Australian Register of Therapeutic Goods. The processing of data only considers whether all the necessary technical documentation relating to the manufacture of the goods has been provided by the applicant for the purpose of including the goods in the Australian Register of therapeutic goods. The evaluation of the technical documentation determine whether the manufacturing and quality control procedures used in the manufacture of goods for the purposes of the Therapeutic Goods Act 1989 is acceptable.
Items [4] to [6] introduces this new desk audit fee and as a consequence mends items 6AA and 6AC.
Item [4] omits the word “evaluation” from item 6AA and insert the word “processing”. Specifically, item 6AA prescribes the fee for processing of data in relation to goods, a step in manufacture of which was carried out outside Australia (in addition to any other fee prescribed in this Schedule in relation to the application) to determine whether the manufacturing and quality control procedures used in the manufacture of the goods are acceptable:
(a) for the purposes of subsection 9D (1), (2) or (3) of the Act; or
(b) for the purposes of paragraph 25 (1) (g), 26 (1) (g), 31 (1) (e) or 31 (2) (d) of the Act.
The fee applicable in item 6AA of Part 2 of Schedule 9 to the Principal Regulations increases by 4.0 per cent (to $280) as provided for in item 7 below.
Item [5]
This inserts item 6ABA to prescribe a $1,500 fee for desk audit evaluation of overseas compliance certification to identify third party certifications and review the overseas compliance certification by examining the underlying audit report and obtaining information from the overseas regulators.
Item [6]
This inserts a reference to the amended item 6AA and new item 6ABA in item 6AC. Item 6AC prescribes the fee for the reinstatement of acceptance status of data relating to the manufacturing and quality control procedures used in the manufacture of goods (which were manufactured or partly manufactured overseas), in addition to the other fees applicable.
The increase to the fee applicable in item 6AA of Part 2 of Schedule 9 of the Principal Regulations, and the (new) desk audit fee applicable in item 6ABA of Part 2 of Schedule 9 of the Principal Regulations 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.
Item [7]
This item increases most fees applicable in Part 2 of Schedule 9 to the Principal Regulations by approximately 4.0 per cent, except for those fees otherwise provided for by this item. The 4.0 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 decreases most evaluation fees for prescription medicines, applicable in paragraphs and items 2A(a), 2B, 2C, 4(a), 4(b), 4(d), 4(e), 4(f), 4(g), and 4(h) of Part 2 of Schedule 9 to the Principal Regulations, by 4.5 per cent in line with a plan to restructure the fee schedule agreed with industry in July 2003.
Part 2 of Schedule 9, paragraph 2(ba) of the Principal Regulations currently provides that the prescribed fee payable for an application to register a medicine:
· 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 20 per cent of the relevant fee, up to a maximum of $6,620.
This item increases the amount of $6,620 in paragraph 2(ba) of Part 2 of Schedule 9 to $6,880. 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.
This item makes no change to the fees prescribed in paragraphs 1(a), 1(b), and 4(c) of Part 2 of Schedule 9 to the Principal Regulations.
This item adjusts similar fee items that have little or no effect on cost recoveries to align for consistency between the medicines and therapeutic devices fee schedules as follows:
· The fee for notification of intention to sponsor a clinical trial using a specified medicine prescribed in item 14 of Part 2 of Schedule 9 to the Principal Regulations; and the fee for the notification of intention to sponsor a clinical trial using a specified therapeutic device, if the sponsor of the device notifies the Secretary, in accordance with item 3 of Schedule 5A, of one or more bodies or organisations conducting the trial (whether or not the sponsor has previously notified the Secretary of one or more bodies or organisations conducting the trial) as prescribed in item 14A of Part 2 of Schedule 9 to the Principal Regulations both will be adjusted from $240 to $250;
· The application fee for the purposes of paragraph 23 (2) (a) of the Act for the registration of therapeutic goods if the previous registration or listing was cancelled solely because of failure to pay the annual registration or listing charge and the application is made within 30 days of the cancellation currently prescribed in items 2AA (registration, currently $360) and 3AA (listing, currently $700) of Part 2 of Schedule 9 of the Principal Regulations both will be adjusted to $480 (per invoice);
· The fee for varying an entry in the Register (not including evaluation of data) under subsection 9D (1), (2) or (3) of the Act, if the variation is for a registered therapeutic device that is mentioned in Part 2 of Schedule 3; a registered therapeutic device, other than a device mentioned in paragraph (d); a listed therapeutic device; or a medical device prescribed in items 2A(d), 2A(e), 2A(f), and 2A(g) of Part 2 of Schedule 9 of the Principal Regulations will all be adjusted to $330; and
· The application fee for paragraph 23 (2) (a) of the Act for the listing of therapeutic goods (other than for an application to which regulation 43A, or item 3AA applies) if the goods are (a) a device prescribed in item 3(a) of Part 2 of Schedule 9 of the Principal Regulations will be adjusted from $310 to $330. This item makes no change to the fee applicable in item 3(b) of Part 2 of Schedule 9 of the Principal Regulations.