EXPLANATORY STATEMENT
Therapeutic Goods Act 1989
Therapeutic Goods Legislation Amendment (Fees and Other Measures) Regulation 2016
The object of the Therapeutic Goods Act 1989 (the TG Act) is to establish and maintain a national system of controls for the quality, safety, efficacy/performance and timely availability of therapeutic goods that are used in Australia or exported from Australia. The Therapeutic Goods Administration (the TGA), which is part of the Department of Health, is responsible for administering the TG 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.
Amongst other matters, the regulations may prescribe fees in respect of matters under the TG Act or the regulations made under the TG Act.
The purpose of the Regulation is, principally, to amend the Therapeutic Goods Regulations 1990 (the TG Regulations) and the Therapeutic Goods (Medical Devices) Regulations 2002 (the MD Regulations), to increase the fees set out in those respective regulations by 2.25 per cent, for the financial year 2016-17.
The increase applies, for example, to: application fees for the registration, listing or inclusion of therapeutic goods (including medicines, therapeutic devices, biologicals and medical devices) in the Australian Register of Therapeutic Goods (the Register); application fees for licences to manufacture, or to undertake a step in the manufacture of, therapeutic goods; fees relating to the evaluation of therapeutic goods for marketing approval; clinical trial notification fees; application fees for export certificates and inspection fees for manufacturing premises.
Fees relating to conformity assessments and abridged conformity assessments of medical devices (these are assessments of the quality of a medical device manufacturer’s manufacturing process and of the product design of a medical device), application fees for the inclusion of medical devices in the Register and application fees for conformity assessment certificates for medical devices, are also covered by the increase.
The 2.25 per cent figure for the increase is based on an indexation formula used to calculate adjustments to TGA fees and charges in most previous years, and is based on the Australian Bureau of Statistics’ Wage Price Index (50 per cent) (in this case, for the year to September 2015) and Consumer Price Index (50 per cent)) (also for the year to September 2015).
This increase ensures that the TGA is able to continue to recover its costs of administering the TG Act.
In applying these increases, the following rounding policy has been applied:
- for fee items that are less than $10,000 - to the nearest $5; and
- for fee items that are greater than or equal to $10,000 - to the nearest $100.
The Regulation also makes a small number of minor amendments to the TG Regulations to clarify that the fees that apply under those regulations for requests by the sponsor of a biological to vary the entry in the Register for that biological do not apply where the variation would result in the creation of a separate and distinct biological. This is because such a request would require a new application for inclusion of the biological in the Register – this would be the case, for example, if a sponsor sought to add a new indication for their Class 3 or Class 4 biological.
The Regulation also amends the TG Regulations to allow the sponsor of a biological to pay a lower fee for a request to vary the entry of the biological in the Register if, principally, the request does not involve the evaluation of quality or manufacturing information – e.g. if the request is just to add a new manufacturing site or to make a change of container, and does not involve any supporting data.
The Regulation also amends the TG Regulations to clarify the fees payable for ‘safety‑related’ changes to an entry for a biological under subsection 9D(3AA) of the Act, and to allow the sponsor of a Class 3 or 4 biological to pay a lower fee for such a change.
Details of the Regulation are set out in the Attachment.
The TG Act does not specify conditions that need to be met before the power to make the Regulation may be exercised.
The Regulation is a legislative instrument for the purposes of the Legislation Act 2003.
The Regulation commences on 1 July 2016.
Consultation
Consultation on the proposal to increase TGA fees and charges by 2.25 per cent was undertaken at bilateral meetings with industry representative groups in February and March 2016. The representative groups – which included Medicines Australia, the Generic and Biosimilar Medicines Association (GBMA), AusBiotech, the Medical Technology Association of Australia (MTAA), IVD Australia, the Australian Dental Industry Association (ADIA), the Australian Self-Medical Industry (ASMI), Complementary Medicines Australia and Accord Australasia – did not object to the proposal.
Authority: Subsection 63(1) of the Therapeutic Goods Act 1989
ATTACHMENT
Details of the Therapeutic Goods Legislation Amendment (Fees and Other Measures) Regulation 2016
Section 1 – Name of regulation
This section provides for the Regulation to be referred to as the Therapeutic Goods Legislation Amendment (Fees and Other Measures) Regulation 2016.
Section 2 – Commencement
This section provides for the Regulation to commence on 1 July 2016.
Section 3 – Authority
This section provides that the Regulation is made under the Therapeutic Goods Act 1989 (the TG Act).
Section 4 – Schedule
Each instrument that is specified in a schedule to this instrument is amended or repealed as set out in the applicable items in the Schedule concerned, and any other item in a Schedule to the Regulation has effect according to its terms.
Schedule 1 – Amendments
Therapeutic Goods (Medical Devices) Regulations 2002
Item 1 – Amendments of listed provisions
Item 1 sets out a table of amendments to listed provisions of the Therapeutic Goods (Medical Devices) Regulations 2002 (the MD Regulations).
The effect of these amendments is to increase the fee for an abridged conformity assessment in paragraph 9.4(2)(b) of the MD Regulations, and the fees for all relevant items in Schedule 5 to the MD Regulations, by 2.25 per cent, subject to the TGA’s rounding policy, from 1 July 2016.
Therapeutic Goods Regulations 1990
Items 2 and 3 – Clause 1 of Schedule 9A (definition of ‘major variation’)
Schedule 9A to the Therapeutic Goods Regulations 1990 (the TG Regulations) sets out a range of fees relating to biologicals, including fees that relate to variations that the sponsor of a biological may, under subsections 9D(3AA) or (3A) of the TG Act, ask the Secretary to make to the entry of that biological in the Australian Register of Therapeutic Goods (the Register).
For Class 3 and Class 4 biologicals, which are generally higher risk products, different evaluation fees apply in relation to such variations, depending on whether the variation is a ‘major variation’ or a ‘minor variation’ as defined in Part 1 of Schedule 9A.
A ‘major variation’ is defined in Part 1 of Schedule 9A as a change to the entry of a biological in the Register that involves any of:
- a change requiring the submission and evaluation of clinical data;
- an extension of indications;
- a new strength;
- a new route of administration;
- a change to the intended patient group; or
- a change in dosage.
There is a concern that this definition could cause confusion, as some of the kinds of changes mentioned in it could result in a Class 3 or 4 biological becoming separate and distinct from other biologicals under section 32AB of the TG Act and regulation 11A of the TG Regulations. In particular, changes to add a new indication would, under subparagraph 11A(1)(b)(iv) of the TG Regulations, result in the creation of a separate and distinct biological. Other changes involving the submission and evaluation of clinical data could also cover changes that would give rise to the creation of separate and distinct biologicals.
If a proposed change to a biological would result in it being separate and distinct from all other biologicals, the Secretary could not vary the entry for the biological under section 9D of the Act – rather, a new application for inclusion of the biological in the Register would be needed in order to supply it lawfully (unless an exemption or approval from the requirement to be included in the Register applies).
To clarify the situation items 2 and 3 amend the definition of ‘major variation’ in Part 1 of Schedule 9A to remove the reference to ‘extension of indications’, and to clarify that a ‘major variation’ does not include a change that would result in a biological becoming separate and distinct from other biologicals.
Item 4 – Class 1 of Schedule 9A (definition of ‘minor variation’)
As mentioned above, different evaluation fees apply under Schedule 9A of the TG Regulations in relation to the requests for the variation of entries in the Register for Class 3 and 4 biologicals under section 9D of the TG Act, depending on whether the proposed variation is a ‘major variation’ or a ‘minor variation’.
A ‘minor variation’ is defined in Part 1 of Schedule 9A as a change to the entry of a biological in the Register that is not a major variation and that involves any of:
- a change requiring evaluation of quality and manufacturing information;
- a new manufacturing site;
- a change in specification; or
- a change in container.
This definition may unintentionally cover changes that would not in fact require the TGA to evaluate quality and manufacturing information – for example, adding a new manufacturing site, or a minor change of container.
Item 4 therefore replaces this definition with a new definition of ‘minor variation’, which limits the scope of that term to changes to Class 3 and 4 biologicals (other than changes that meet the definition of a major variation) that require the evaluation of supporting quality and manufacturing information. This means that for changes to the entry in the Register for a Class 3 or Class 4 biological that (a) are not major variations and (b) do not involve the evaluation of supporting information relating to quality and manufacturing, a significantly lower fee than currently for such changes will be payable by sponsors.
Such sponsors will only incur the application fee of $1025 at item 8 of Part 2 of Schedule 9A rather than that fee and the current evaluation fee for minor variations of $16,400 at item 10 of Part 2 - noting that these amounts are updated to, respectively, $1050 and $16,800, on 1 July 2016 by the changes in item 10 below.
Item 5 – Part 2 of Schedule 9A (cell at table item 8), column headed “Matter”)
The description of the fee at item 8 of Part 2 of Schedule 9A to the TG Regulations, in column 2 of that Table, refers to ‘Application for variations to information about a biological included in the Register under subsection 9D(3AA) or (3A) of the Act’.
Item 5 makes a minor amendment to that description to more closely reflect the basis on which requests for variations are made under the Act.
Items 6-9 – Part 2 of Schedule 9A (new table item 8A, and amendments to cells at table items 9-11)
The fees for evaluating information associated with sponsors’ requests to vary entries in the Register for Class 2 biologicals (item 9 of Part 2 of Schedule 9A – currently $6,255), or to make minor variations for Class 3 or Class 4 biologicals (item 10 of Part 2 of Schedule 9A – currently $16,400) cover variations under both subsection 9D(3AA) and 9D(3A) of the TG Act.
Variations under subsection 9D(3AA) of the TG Act are often referred to as ‘safety-related’ changes, as the provision allows the Secretary to change the entry provided the only effect of the change would be to reduce the class of persons for whom a biological would be suitable, or to add a warning or precaution that would not include any comparison with any other therapeutic goods in relation to quality, safety or efficacy.
Subsection 9D(3A) of the TG Act covers all other variations to biologicals entries in the Register, except for minor variations to correct incorrect or incomplete information (which may be made by the Secretary under subsection 9D(1) of the TG Act).
For greater clarity, and also in particular because there are concerns that the current fee of $16,400 in item 10 of Part 2 of Schedule 9A is too high for safety-related minor variations to Class 3 or Class 4 biologicals, items 7 and 8 remove references to subsection 9D(3AA) of the TG Act from items 9 and 10 of Part 2 of Schedule 9A.
Item 6 introduces a new item 8A to Part 2 of Schedule 9A, which sets out the evaluation fee for subsection 9D(3AA) variations – being, $6,395. This fee is based on the current fee in item 9 of the Table in Part 2 of Schedule 9A for the evaluation of variation requests involving Class 2 biologicals – currently $6,255 – with the 2.25 per cent increase for 2016-17 applied.
Items 7 and 8 also remove an outdated reference to ‘product dossier’ from items 9 and 10 of Part 2 of Schedule 9A, and item 9 removes that reference from item 11 of Part 2 of Schedule 9A, which specifies the evaluation fee for major variations for Class 3 and Class 4 biologicals.
Item 10 – Amendments of listed provisions
Item 10 sets out a table of amendments to listed provisions of the TG Regulations.
The effect of these amendments is to increase various fees specified in subregulations 45(4A), 45(9) and 45(11) of the TG Regulations, and in Parts 2 and 3 of Schedule 9 and Part 2 of Schedule 9A to the TG Regulations, by 2.25 per cent, subject to the TGA’s rounding policy, from 1 July 2016.
Statement of Compatibility with Human Rights
Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011
Therapeutic Goods Legislation Amendment (Fees and Other Measures) Regulation 2016
The Therapeutic Goods Legislation Amendment (Fees and Other Measures) Regulation 2016 (the Amendment Regulation) is compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.
Overview of the Legislative Instrument
The Amendment Regulation is made under subsection 63(1) of the Therapeutic Goods Act 1989 (the TG Act), and amends the Therapeutic Goods Regulations 1990 (the TG Regulations) and the Therapeutic Goods (Medical Devices) Regulations 2002 (the MD Regulations) to increase fees relating to the regulation of therapeutic goods and manufacturing licences by 2.25 per cent, from 1 July 2016.
The increase in fees applies, for example, to application fees for the entry of therapeutic goods in the Australian Register of Therapeutic Goods (the Register) and for manufacturing licences, evaluation fees, clinical trial notification fees and manufacturing inspection fees.
The 2.25 per cent figure is based on a formula used to calculate TGA fees and charges increases in most previous years, and is based on the Australian Bureau of Statistics’ Wage Price Index (50 per cent) and Consumer Price Index (50 per cent) – both for the year to September 2015. This increase ensures the TGA can to continue to recover its costs of administering the TG Act.
The Amendment Regulation also makes a small number of minor changes to the TG Regulations in relation to fees for biologicals, including for example to clarify that fees for requests to vary an entry in the Register for a biological do not apply where the variation would result in the creation of a separate and distinct biological (such requests require a new application for entry in the Register), and to allow sponsors of Class 3 and 4 biologicals to pay a lower fee than currently for a request to vary the entry in the Register for their biological if there is no manufacturing and quality information to be evaluated with the request.
Human rights implications
As the Amendment Regulation does not introduce any changes to the TG Regulations or MD Regulations other than to implement the changes of the kind mentioned above, it does not engage any of the applicable rights or freedoms.
Conclusion
This legislative instrument is compatible with human rights as it does not raise any human rights issues.
Sussan Ley, Minister for Health