EXPLANATORY STATEMENT

 

Select Legislative Instrument 2005 No. 193

 

Issued by the Authority of the Parliamentary Secretary to the Minister for

Health and Ageing

 

Therapeutic Goods Act 1989

 

Therapeutic Goods (Medical Devices) Amendment Regulations 2005 (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, 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.  Paragraph 63(3)(b) of the Act provides, in part, for the reduction of fees in cases identified in the regulations. 

 

Schedule 5 to the Therapeutic Goods (Medical Devices) Regulations 2002 (the Principal Regulations) provides the list of fees chargeable under Chapter 4 (Medical Devices) of the Act.  The fees payable pursuant to Schedule 5 include the processing of applications for inclusion of medical devices in the Australian Register of Therapeutic Goods and initial and subsequent assessments under the conformity assessment procedures.  These fees reflect the cost incurred by the TGA in performing the various tasks under the Act and the Principal Regulations. 

 

Subregulation 9.4(2) of the Principal Regulations allows the Secretary of the Department of Health and Ageing to conduct an abridged conformity assessment of a medical device in prescribed circumstances and to charge a reduced fee for that assessment, currently $2,670. 

 

The purpose of the Regulations is to increase, by 1.6 per cent, the fees payable in relation to medical devices listed in Schedule 5, and the reduced fee in subregulation 9.4(2).  These fees predominately relate to conformity assessments, application audit assessments and applications in relation to clinical trials of medial devices. These fees are increased annually, and the proposed increases would enable the TGA to continue to meet the Government’s requirement that the TGA operate on a full cost-recovery basis.

 

The increase in fees is usually calculated by adding together 50 per cent of the annual Wage Cost Index (WCI) for the preceding year ended December and 50 per cent of the Consumer Price Index (CPI) for the preceding year ended December, which would work out to be a 3.1 per cent increase on this occasion.  However, given the level of operating reserves of the TGA and the demands on industry in preparing for the new Trans Tasman Joint Agency, the increase in charges is limited to 1.6 per cent.

 

The level of fees was reviewed in consultation with industry associations, including Medicines Australia, the Generic Medicines Industry of Australia, the Australian

Self-Medication Industry, the Complementary Healthcare Council of Australia and the Medical Industry Association of Australia. Industry associations had agreed to the WCI/CPI formula being applied to fees as the basis for a 3.1 per cent increase.  Industry associations would not oppose limiting the overall increase to 1.6 per cent.

 

The new fees have been rounded to ten dollar increments (for amounts up to ten thousand dollars) or one hundred dollar increments (for amounts of ten thousand dollars or more).   

 

The Act specifies no conditions that need to be met before the power to make the Regulations may be exercised.

 

Details of the Regulations are set out in the Attachment.

 

The Regulations are a legislative instrument for the purposes of the Legislative Instruments Act 2003. 

 

The Regulations commence on the day after they are registered on the Federal Register of Legislative Instruments.

 

 

ATTACHMENT

 

Details of the Therapeutic Goods (Medical Devices) Amendment Regulations

2005 (No. 1)

 

Regulation 1 – Name of Regulations

 

This regulation provides that the title of the Regulations is the Therapeutic Goods (Medical Devices) Amendment Regulations 2005 (No. 1)

 

Regulation 2 – Commencement

 

This regulation provides for the Regulations to commence on the day after they are registered on the Federal Register of Legislative Instruments.

 

Regulation 3 – Amendment of the Therapeutic Goods (Medical Devices) Regulations 2002  

 

This regulation provides that the Therapeutic Goods (Medical Devices) Regulations 2002 (the Principal Regulations) are amended as set out in the Schedule.                                                                                                                                                     

Schedule 1 - Amendments

 

Item [1] – Paragraph 9.4 (2) (b)

 

This item amends paragraph 9.4(2)(b), to increase the level of reduced fees that apply for an abridged conformity assessment by 1.6 per cent, from $2,670 to $2,710.

 

Item [2] – Schedule 5, Part 1, column 4

 

This item increases the fees for all items of in Part 1 of Schedule 5 to the Principal Regulations by 1.6 per cent.

 

Item [3] - Schedule 5, Part 1, paragraph 2.1 (b)

 

This item increases the hourly rate for assessments conducted outside Australia by

1.6 per cent, from $280 to $290 per hour.