EXPLANATORY STATEMENT

Therapeutic Goods Act 1989

Therapeutic Goods Legislation Amendment (Fees and Other Measures) Regulations 2017

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/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 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.

Amongst other matters, the regulations may prescribe fees in respect of matters under the  Act or the regulations made under the Act.

The purpose of the Therapeutic Goods Legislation Amendment (Fees and Other Measures) Regulations 2017 (the Regulations) 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 1.65 per cent, for the financial year 2017-18.

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 1.65 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 2016) and Consumer Price Index (50 per cent)) (also for the year to September 2016). 

This increase ensures that the TGA is able to continue to recover its costs of administering the Act.

In applying these increases, the following rounding policy has been applied:

• for fee items that are less than $10,000 - to the nearest $10; and
• for fee items that are greater than or equal to $10,000 - to the nearest $100.

The Regulations also introduce new application fees that apply in relation to requests by sponsors to reinstate an entry in the Register for their goods where those goods were cancelled at the sponsor’s own request and where the reinstatement request is made within 90 days of the cancellation.

Details of the Regulations are set out in the Attachment.

The Act does not specify conditions that need to be met before the power to make the Regulations may be exercised.

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

The Regulations commence on 1 July 2017.

Consultation

Consultation on the proposals to increase TGA fees by 1.65 per cent and to introduce a reinstatement application fee from 1 July 2017 was undertaken at bilateral meetings with industry representative bodies in February 2017. The representative bodies - Medicines Australia, the Generic and Biosimilar Medicines Association, AusBiotech, the Medical Technology Association of Australia, IVD Australia, the Australian Dental Industry Association (ADIA), the Australian Self-Medical Industry, Complementary Medicines Australia and Accord Australasia - did not object to the proposals.

Authority:  Subsection 63(1) of the Therapeutic Goods Act 1989

ATTACHMENT

Details of the Therapeutic Goods Legislation Amendment (Fees and Other Measures) Regulations 2017

Section 1 – Name

This section provides for the Regulations to be referred to as the Therapeutic Goods Legislation Amendment (Fees and Other Measures) Regulations 2017.

Section 2 – Commencement

This section provides for the Regulations to commence on 1 July 2017.

Section 3 – Authority

This section provides that the Regulations are made under the Therapeutic Goods Act 1989 (the TG Act).

Section 4 – Schedules

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 Regulations has effect according to its terms.

Schedule 1 – Amendments

Therapeutic Goods (Medical Devices) Regulations 2002

Item 1 – Part 1 of Schedule 5 (after table item 1.6)

Item 1 amends the MD Regulations to introduce a reinstatement application fee that applies where a sponsor asks the Secretary to revoke the cancellation of an entry in the Register for the sponsor’s kind of medical device, in accordance with section 41GLA of the Act.

Section 41GLA of the Act gives the Secretary the power to revoke the cancellation of an entry in the Register for a kind of medical device where the cancellation was at the sponsor’s own request, with the effect of reinstating the entry as if the cancellation had never occurred.  For the Secretary to be able to do so under section 41GLA of the Act, the sponsor must apply for the revocation, and pay the prescribed application fee (if any), within 90 days of the cancellation.

A 2-tier structure for such application fees is introduced, under which the fee for a reinstatement application that contains only one entry will be $150, and the fee for an application that contains more than one entry will be $150 for the first entry, plus $50 for each additional entry.

These amounts reflect staff processing costs based on the average hourly rates of various relevant levels of personnel within the Regulatory Practice and Support Division of the Department’s Health Products Regulation Group in relation to the expected processing times for these applications.

Item 2 – Amendments of listed provisions

Item 2 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 1.65 per cent, subject to the TGA’s rounding policy, from 1 July 2017. 

Therapeutic Goods Regulations 1990

Item 3  – Part 2 of Schedule 9 (after table item 6B)

Item 3 amends the TG Regulations to introduce an equivalent reinstatement application fee for registered and listed therapeutic goods as introduced for medical devices by item 1 above, with the same 2-tier fee structure and amounts involved, for the purposes of section 30A of the TG Act.

Item 4 – Part 2 of Schedule 9A (after table item 16)

Item 4 amends the TG Regulations to introduce an equivalent reinstatement application fee for biologicals as that introduced for medical devices by item 1 above, with the same 2-tier fee structure and amounts involved, for the purposes of section 32GD of the TG Act.

Item 5 – Amendments of listed provisions

Item 5 sets out a table of amendments to listed provisions of the TG Regulations.

The principal 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 1.65 per cent, subject to the TGA’s rounding policy, from 1 July 2017.

These amendments also make a small number of changes to the TG Regulations to increase the amount that the Secretary must refund to some sponsors in certain circumstances by more than 1.65 per cent (3.87 - 3.97 per cent).  This is in respect of sponsors who apply for the registration of over the counter medicines, but where the evaluation is not carried out.  The increase to the amount that the Secretary must refund in these circumstances better ensures that only the cost of processing such applications is retained where the TGA does not undertake an evaluation for such products. 

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) Regulations 2017

The Therapeutic Goods Legislation Amendment (Fees and Other Measures) Regulations 2017 (the Regulations) 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 Regulations are made under subsection 63(1) of the Therapeutic Goods Act 1989 (the Act), and amend the Therapeutic Goods Regulations 1990 (the TG Regulations) and Therapeutic Goods (Medical Devices) Regulations 2002 (the MD Regulations) to, principally, increase fees relating to the regulation of therapeutic goods and manufacturing licences by 1.65 per cent, from 1 July 2017.

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 manufacturing inspection fees.

The 1.65 per cent figure is based on a 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 2016) and Consumer Price Index (50 per cent)) (also for the year to September 2016). This increase is designed to ensure that the TGA is able to continue to recover its costs of administering the Act.

The Regulations also introduce a new application fee for requests by sponsors to reinstate an entry in the Register for their goods where those goods were cancelled at the sponsor’s own request and where the reinstatement request is made within 90 days of the cancellation.

Human rights implications

As the Regulations do not introduce any changes to the TG Regulations or MD Regulations other than to implement the changes outlined 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.

Greg Hunt, Minister for Health