THERAPEUTIC GOODS AMENDMENT (2016 MEASURES NO. 1) BILL 2016 Explanatory Memorandum

Commonwealth of Australia Explanatory Memoranda

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THERAPEUTIC GOODS AMENDMENT (2016 MEASURES NO. 1) BILL 2016

2016-2017 THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA HOUSE OF REPRESENTATIVES THERAPEUTIC GOODS AMENDMENT (2016 MEASURES NO. 1) BILL 2016 REPLACEMENT EXPLANATORY MEMORANDUM (Circulated by authority of the Minister for Health and Minister for Sport, the Hon Greg Hunt MP) THIS MEMORANDUM REPLACES THE EXPLANATORY MEMORANDUM PRESENTED TO THE HOUSE OF REPRESENTATIVES ON 1 DECEMBER 2016, AND INCORPORATES AMENDMENTS RESPONDING TO ISSUES RAISED BY THE SENATE STANDING COMMITTEE FOR THE SCRUTINY OF BILLS IN SCRUTINY DIGEST NO.3 OF 2017, DATED 22 MARCH 2017

Therapeutic Goods Amendment (2016 Measures No. 1) Bill 2016 Outline The Therapeutic Goods Amendment (2016 Measures No. 1) Bill 2016 makes a number of amendments to the Therapeutic Goods Act 1989 (the Act). These amendments will:  support the implementation of eight key recommendations of the Expert Panel Review of Medicines and Medical Devices Regulation (the Review), which was established to, principally, identify areas of the regulation of medicines and medical devices which could be streamlined, while maintaining the safety and quality of therapeutic goods available in Australia (Review recommendations 3, 13, 15, 24, 27, 41, 42 and 47);  support the recent consolidation of statutory advisory committees;  ensure greater consistency in the regulation of different classes of therapeutic goods under the Act; and  make minor amendments to the Act, principally to reduce health risks or reduce regulation. New pathways for approval of medicines and medical devices The Review recommended that new pathways be established for the approval of new medicines and medical devices in Australia (Review recommendations 3 and 15), to facilitate quicker access by patients to new medicines and devices that have significant advantages over existing treatments. The Bill supports the implementation of these recommendations by, principally, providing a regulation-making power to set out the details of new pathways for the priority approval of medicines and medical devices and biologicals that are fully evaluated for safety- quality and efficacy or performance, and for the priority approval of conformity assessment certificate applications for medical devices. Regulations made for the purposes of this new power may include, for example, the criteria for qualifying to utilise these new priority pathways, how to apply, the information that must accompany an application and relevant application fees. The details of these arrangements will be the subject of extensive consultation before the regulations are made. The Bill provides a legislative basis for the making of regulations to implement the fast-tracking of applications to include therapeutic goods in the Australian Register of Therapeutic Goods (the Register), and applications for conformity assessment certificates for medical devices. 1

Variations to medicines through notification The Review recommended that Australia adopt a risk-based approach to the management of variations to medicines, by allowing certain kinds of variations that do not impact the quality, safety or efficacy of medicines to be made by notification to the Therapeutic Goods Administration (the TGA) rather than requiring the approval of the Secretary of the Department of Health (Review recommendations 13 and 42). The Bill supports these recommendations by providing a regulation-making power to prescribe such "notifiable" variations for medicines (such variations are likely to be low risk, straightforward changes to product details), and by requiring that when sponsors ask the Secretary to update the entry in the Register for their goods in relation to one of these kinds of variations, the Secretary must amend the entry accordingly. This mechanism will only be available where it does not impact on the safety of a good. Enabling Australian 'notified bodies' to undertake conformity assessment of medical devices The Review recommended that provision be made for conformity assessment of medical devices to occur in Australia by private bodies designated by the TGA to appraise the suitability of the manufacturing process ("conformity assessment procedures") for devices that are manufactured in Australia, and to assess whether such devices meet minimum standards of safety and performance ("essential principles") (Review recommendation 15). The Bill supports this recommendation by providing a regulation-making power to enable regulations to be made to allow the Secretary to designate bodies in Australia to undertake such conformity assessment of manufacturers of medical devices, and to set out appropriate related arrangements. These would include, for example, the power to set out in regulations the criteria for qualifying to become such a body, how to apply to become such a body and conditions that may apply in respect of a body's designation (any such conditions will be the subject of extensive stakeholder consultation before regulations are made, but are likely to include allowing the inspection of premises and providing information or documents for monitoring purposes). A body may be designated generally under the regulations, or may be limited to assessing specified kinds of devices or conducting assessments against specified kinds of conformity assessment requirements. These new Notified Bodies will provide an alternative avenue, other than the TGA, for manufacturers of medical devices to obtain a conformity assessment certificate required before their medical devices may be included in the Register by the TGA. 2

Enabling health practitioners to supply certain therapeutic goods not on the Register to patients under a notification scheme The Review recommended that criteria be developed for identifying certain therapeutic goods that are not in the Register that may be able to be supplied to patients other than those who are gravely ill by notification to the TGA rather than, as is the case currently, requiring the prior approval of the Secretary (Review recommendation 24). The Bill would support the implementation of this measure, principally by allowing the Minister to make a legislative instrument identifying certain kinds of medicines for this purpose (these are likely to be particular products with a history of safe use in comparable overseas countries, but which for commercial reasons have not been registered in Australia), the kinds of health practitioners who may supply such goods to their patients and in what circumstances, the kinds of persons who can receive such goods and any conditions that must be complied with in relation to such supply. The Bill includes equivalent measures in respect of biologicals and medical devices. 'Health practitioner' would be defined in the Bill as covering a range of medical-related fields, including medical practitioners, dentists, nurses and optometrists. Provided practitioners supply these medicines in accordance with the arrangements set out in that instrument, and notify the Secretary within 28 days of having done so, they may supply the goods to their patients without needing prior approval. Supply of other unapproved products would still require prior approval. The Bill also allows regulations to be made to specify constraints or requirements in relation to what the Minister may set out in the instrument (for example, if particular therapeutic goods should not be supplied under these arrangements because there are other, more appropriate mechanisms, with greater oversight, for those goods). Medicines that may qualify under this scheme may include products that were formerly registered on the Register but that were withdrawn for reasons other than safety reasons; medicines that have been approved for the proposed indication by a comparable overseas regulator; medicines that the TGA deems suitable for automatic approval; or medicines which have been approved by the TGA in response to a medicine shortage, where there is no need to triage the use of an unapproved product. Review and appeal rights for persons applying to include new ingredients as permissible ingredients in listed complementary medicines Currently, listed medicines may only contain those ingredients specified in a legislative instrument made by the Minister under s.26BB of the Act. The Review recommended that review and appeal rights be provided for sponsors who lodge applications for the approval of new ingredients for use in listed complementary medicines (recommendation 47). The Bill would implement this measure by providing a mechanism for persons to apply at first instance to the Secretary for a recommendation that the Minister vary the permissible ingredients legislative instrument (including an application to add a new ingredient in the instrument). The Secretary would be required to evaluate such applications, and then either 3

make the requested recommendation to the Minister or refuse to do so. Review and appeal rights (initially, to the Minister under section 60 of the Act and, later, to the Administrative Appeals Tribunal in relation to a review of the Minister's decision on reconsideration) would apply for the applicant in respect of any refusal by the Secretary to make the requested variation. Under the amendments in the Bill, where the Secretary makes the recommendation requested by the applicant, the Minister must either vary the permissible ingredients instrument or refuse to do so. While the Minister would not be bound to adopt the Secretary's recommendation, the Minister would be required to take the recommendation into account in considering whether to adopt or reject it. Timeframes for decisions in relation to listed complementary medicines The Review recommended that legislative timeframes be developed within which some decisions must be made or steps completed in relation to listed complementary medicines, such as the consideration of new ingredients for use in these medicines (recommendation 41). The Bill supports the implementation of this recommendation by creating a general power to enable regulations to be made setting timeframes within which regulatory decisions, or the exercise of statutory powers, must be made or exercised under the Act, in respect of all therapeutic goods including complementary medicines. Strengthening Post-Marketing Activity The Review recommended that the TGA develop a more comprehensive post-market monitoring scheme for medicines and medical devices (recommendation 27). The Bill supports the implementation of this recommendation by introducing a provision to enable new record-keeping obligations for medicines sponsors to be prescribed in the Regulations to assist with post-marketing monitoring. In addition, in order to verify that sponsors' current pharmacovigilance obligations are being complied with, the Bill also ensures that 'authorised persons' (who are charged with monitoring compliance with the Act and Regulations) are able to enter premises where sponsors of therapeutic goods included in the Register keep documents that relate to those goods, or premises where sponsors have an obligation to keep records about their goods under the Act or Regulations. This will clearly enable authorised persons, who for example may be TGA medical officers, to establish whether sponsors are complying with all of their pharmacovigilance obligations. Other post marketing powers, recalls and public notifications, and obtaining information about therapeutic goods, have also been strengthened through minor amendments in the Bill. Where recalls of therapeutic goods are undertaken, provision has been made to enable the Secretary to require the person responsible for undertaking the recall to provide more information about the recalled goods and the circumstances of the recall, to the public, or to 4

certain classes of persons, in a manner specified by the Secretary and within a specified reasonable time. The amendments in the Bill relating to strengthening post-market activity will supplement other enhancements to the current post-market framework that will be achieved at the Therapeutic Goods Administration through changes in business processes and investment in new IT systems (e.g. for the capture and analysis of medicines and medical devices adverse events) and the analysis of large patient de-identified data sets. These do not require any change to legislation or regulation. Amendments to TGA statutory advisory committees Consistent with the recommendations Review, the government is reducing the number of advisory committees established under the Act and Regulations. The recent Therapeutic Goods Amendment (Advisory Committees and Other Measures) Regulation 2016 rationalised the number of these committees in Part 6 of the Therapeutic Goods Regulations 1990 from nine such committees to five. The Therapeutic Goods Committee is proposed for abolition. This committee's role of advising on standards for therapeutic goods will be spread across the relevant one of the four of the new or continuing committees as of 1 January 2017. The amendments in the Bill would enhance these measures, principally by removing the current requirement in subsection 10(4) of the Act for the Minister, when making standards for therapeutic goods other than medical devices, to first consult the Therapeutic Goods Committee before being able to take such action. The Minister will still have the option of consulting any of the new committees about matters relating to standards, but will not be compelled to do so before making a standard. Other amendments The Bill contains a number of other amendments to the Act, that are principally aimed at achieving greater consistency between different types of therapeutic goods, reducing health risks to the public, reducing regulation or making other, more minor amendments to the Act. These measures include the following: - enabling the cancellation of registered or listed therapeutic goods from the Register if the sponsor of the goods has supplied false or misleading information in relation to their application to include their goods in the Register; - allowing the Secretary to require manufacturing licence holders to provide information or documents upon request; 5

- allowing the Secretary to reinstate therapeutic goods to the Register that were cancelled if the goods were cancelled for non-payment of annual charges and if, principally, the sponsor has paid the charge; - allow conditions on the inclusion of kinds of medical devices in the Register to be either prescribed by regulation, or set out in a legislative instrument made by the Minister, to bring the situation in relation to conditions for medical devices in line with registered or listed therapeutic goods under the Act. Financial Impact Statement The Government allocated $13.5 million in both operating and capital expenses from the Budget in 2016-2017 to improve the regulation of therapeutic goods in Australia. The TGA special account reserves (comprised of revenue from industry fees and charges) will be used to fund this allocation. 6

Statement of Compatibility with Human Rights for a Bill that raises human rights issues Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011 THERAPEUTIC GOODS AMENDMENT (2016 MEASURES NO. 1) BILL 2016 This Bill 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 Bill This Bill amends the Therapeutic Goods Act 1989 (the Act) in relation to a range of matters including in particular to support the implementation of a number of recommendations of the Expert Panel Review of Medicines and Medical Devices, agreed to by the Government in its Response to the Review that was announced on 15 September 2016. These include, for example, amendments to the Act to:  enable the making of regulations to establish new priority pathways for faster approval of medicines, medical devices, biologicals and conformity assessment certificates in Australia;  enable the making of regulations to designate Australian notified bodies that would be able to appraise the suitability of the manufacturing process for medical devices manufactured in Australia and to consider whether such medical devices meet relevant minimum standards for safety and performance, as an alternative to the TGA undertaking such assessments;  allow certain unapproved therapeutic goods that are currently accessed by healthcare practitioners through applying to the Secretary for approval to be more easily obtained by practitioners only having to notify the Secretary within 28 days of having supplied such goods to their patients, rather than requiring pre-approval (the amendments would allow the Minister to make a legislative instrument specifying which goods would be able to be accessed in this way, by which kinds of healthcare practitioners and in what circumstances and in accordance with conditions specified in the instrument); and  provide review and appeal rights for persons who apply to add new ingredients for use in listed complementary medicines. The Bill also includes a number of other, mostly minor measures, to provide greater consistency across the regulation of different kinds of therapeutic goods under the Act, reduce regulatory burden, reduce health risks to the public or make other, more minor changes. 7

These include, for example:  enabling the cancellation of registered or listed therapeutic goods from the Register if the sponsor of the goods has supplied false or misleading information in relation to their application to include their goods in the Register;  allowing the Secretary to require manufacturing licence holders to provide information or documents upon request;  allowing the Secretary to reinstate therapeutic goods to the Register that were cancelled if the goods were cancelled for non-payment of annual charges and if, principally, the sponsor has paid the charge; and  to allow conditions on the inclusion of kinds of medical devices in the Register to be either prescribed by regulation, or set out in a legislative instrument made by the Minister, to bring the situation in relation to conditions for medical devices in line with registered or listed therapeutic goods under the Act, such as medicines.. Human Rights implications This Bill contains one measure that may raise Article 17 of the International Covenant on Civil and Political Rights (the ICCPR). This measure is the amendment to paragraph 28(5)(a) of the Act to expand the types of premises that a sponsor of registered or listed therapeutic goods must allow an authorised person to enter, at any reasonable time, to verify compliance with regulatory requirements. Under paragraph 28(5)(a) of the Act currently, sponsors of such goods must allow authorised persons to enter, at any reasonable time, premises at which a person deals with the goods. The Bill would amend paragraph 28(5)(a) to also cover premises at which record-keeping requirements are complied with in relation to the goods. The record-keeping requirements referred to relate to:  the current requirement in paragraph 28(5)(c) of the Act for sponsors to keep a record in relation to each batch of their goods for at least 12 months after the goods' expiry of all of the manufacturers involved in the manufacture of that batch; and  any other record-keeping requirements that are prescribed in regulations for the purposes of new paragraph 28(5)(ca), which is also an amendment made by the Bill. The Bill includes a consequential amendment to allow an authorised person to inspect and make copies of any records kept in compliance with these requirements, and any documents that relate to the goods in question. The Bill also contains a related amendment to section 46A of the Act (which deals with the powers of an authorised person to enter and search a range of premises including those of sponsors of registered or listed goods, otherwise than as a condition of registration or listing), to permit authorised officers to search such sponsors' premises that are connected with the keeping of records in accordance with the above conditions. 8

The right to privacy is set out in Article 17 of the International Covenant on Civil and Political Rights (the ICCPR). This right is not an absolute right, and may be limited in some circumstances. Article 17 protects against arbitrary and unlawful infringements of privacy, meaning that interference with this right can only be as authorised by law, and that authorities may not have too much discretion to interfere with this right. The Guide to Framing Commonwealth Offences, Infringement Notices and Enforcement Powers (the Guide) provides at section 8.6 that "A person who obtains a licence or registration for non-residential premises can be taken to accept entry to those premises by an inspector for the purpose of ensuring compliance with the licensing or registration conditions". The Guide also indicates in section 8.7 in relation to monitoring warrant powers that the Senate Standing Committee for the Scrutiny of Bills has expressed the view that such powers can be conferred where a person has accepted a commercial benefit, subject to being monitored by this means, and in relation to matters which are serious, cannot otherwise be checked and where the powers are used with maturity and are proportionate to the benefit gained. In relation to the powers to enter premises outlined above, there may be instances where sponsors' records about their goods are kept at premises where the therapeutic goods themselves are not dealt with - for example, if a sponsor has a number of sites where it undertakes a range of activities including a separate administrative centre where records are kept. As section 28 of the Act currently only allows authorised persons to enter premises where sponsors of registered or listed therapeutic goods deal with their goods, it would appear to be difficult to otherwise verify compliance with both the existing record-keeping requirements in paragraph 28(5)(c) of the Act, and any record-keeping requirements that are prescribed for the purposes of new paragraph 28(5)(ca), without the ability for authorised officers to enter such premises as proposed by the Bill. In addition, sponsors of registered or listed therapeutic goods participate in the scheme of pharmaceutical regulation set out in the Act voluntarily, and already operate under the existing condition of having their premises in which their goods are dealt with able to be inspected by authorised persons. With the above in mind, it would appear that the measures outlined above to permit authorised persons to enter record-keeping premises are appropriate and proportionate in relation to Article 17. Conclusion The addition of this provision enabling entry to premises for the purposes of pharmacovigilance is compatible with human rights because to the extent that it may limit human rights, those limitations are reasonable and proportionate. The Hon Greg Hunt MP, Minister for Health and Minister for Sport 9

NOTES ON CLAUSES Clause 1 - Short title This clause provides that the Bill, once enacted, may be cited as the Therapeutic Goods Amendment (2016 Measures No. 1) Act 2016. Clause 2 - Commencement This clause sets out the manner in which the provisions contained in the Bill will commence. Clauses 1, 2 and 3 will commence on the day the Bill receives Royal Assent. Schedules 2 to 8 and 10 to 12 of the Bill will commence on the day after the Bill receives Royal Assent. Schedules 1 and 9 of the Bill will commence on a day to be fixed by Proclamation. Clause 3 - Schedule(s) This clause provides that each Act or Acts specified in a Schedule to this Bill will be amended or repealed as provided for under the items in that Schedule concerned, or will otherwise take effect according to the terms of that item. 10

SCHEDULE 1 - Variation of entries in Register Therapeutic Goods Act 1989 This schedule contains amendments to the Act which will, in appropriate circumstances, enable sponsors of therapeutic goods that are entered in the Australian Register of Therapeutic Goods (the Register) to vary their entries, that is to make changes to information about their goods included in the Register by way of a notification to the Secretary, rather than by applying to seek the Secretary's approval for the variation. The main effect of including goods in the Register is that the sponsor of those goods may lawfully import, export, manufacture and supply those goods. To maintain the currency of the information about their goods in the Register, variations to that information may be necessary. Variations to Register entries may be made pursuant to section 9D of the Act. It is intended that notifiable variations will be low risk, straightforward changes to product details, which do not impact on the safety of a product - consistent with the Review's recommendation that notifiable variations do not impact on a product's quality, safety or efficacy. Three examples of such notifiable variations that are anticipated to be prescribed for the purposes of the new products are:  the removal of a sponsor's nominated manufacturer;  a minor change to the container for a medicine, where tests show that the product's quality is not affected by the change;  minor changes to product labels, for example to include the full list of excipient ingredients in a medicine. Item 1 This item amends section 9D by inserting a new subsection 9D(2C). This has the effect that if a sponsor has included a registrable or listable therapeutic good in the Register and requests a variation to its entry for those goods, and the variation is of a kind specified in the regulations for the purposes of this provision and the variation also meets the conditions prescribed in the regulations for this kind of variation, then the Secretary must vary the entry for those goods in the Register. This provision will enable eligible variations to be effected by sponsors by way of a notification to the Secretary, instead of by way of lodging an application to seek approval for the variation. Item 2 This item inserts new paragraph 9D(3)(ba) to clarify that the circumstances under which the Secretary may currently vary an entry in the Register under subsection 9D(3) will continue to apply so long as the variation is not of a kind provided for under new subsection 9D(2C). Item 3 This item amends section 9D to insert a new subsection 9D(3AC). This has the effect that if a sponsor has included a biological in the Register and requests a variation to its entry for 11

those goods, and the variation is of a kind specified in the regulations for the purposes of this provision and the variation also meets the conditions prescribed in the regulations for this kind of variation, then the Secretary must vary the entry for those goods in the Register. This provision will enable eligible variations to entries relating to biologicals to be effected by sponsors by way of a notification to the Secretary, instead of by way of lodging an application to seek approval for the variation. Item 4 This item inserts new paragraph 9D(3A)(ab). This new paragraph will clarify that the circumstances under which the Secretary may currently vary an entry in the Register under subsection 9D(3A) for a biological will continue to apply so long as the variation is not of a kind provided for under new subsection 9D(3AC). Item 5 This item inserts a new subsection 9D(3CB). This has the effect that if a sponsor has included a kind of medical device in the Register and requests a variation to its entry for those goods, and the variation is of a kind specified in the regulations for the purposes of this provision and the variation also meets the conditions prescribed in the regulations for this kind of variation, then the Secretary must vary the entry for those goods in the Register. This provision will enable eligible variations to entries relating to medical devices to be effected by sponsors by way of a notification to the Secretary, instead of by way of lodging an application to seek approval for the variation. Item 6 This item inserts new paragraph 9D(3D)(ba). This new paragraph will clarify that the circumstances under which the Secretary may currently vary an entry in the Register under subsection 9D(3A) for a kind of medical device will continue to apply so long as the variation is not of a kind provided for under new subsection 9D(3CB). 12

SCHEDULE 2 - Conformity assessment of medical devices This Schedule inserts new Part 4-4A into the Act: "Australian conformity assessment bodies". Measures contained under this Part will allow the Therapeutic Goods Administration (TGA) to designate Australian companies to undertake conformity assessments of medical devices, and will provide for those conformity assessments to be able to be used when the Secretary decides whether medical devices assessed by such companies can be included in the Register. Conformity assessment is the examination of manufacturing practices and procedures to ensure that medical devices that have been manufactured comply with applicable essential principles, which relate to the safety and performance of medical devices. The amendments in this Schedule principally provide for the setting out of matters relating to the making of conformity assessment body determinations, and the operation of Australian conformity assessment bodies, in regulations. In relation to why it is considered necessary to leave most of the elements of this new scheme to delegated legislation, this will be a new scheme for Australia which will supplement, rather than replace, the existing pathways. Currently, conformity assessments are undertaken by the TGA and by European bodies with the oversight of their national governments. As it is a new scheme, there is a need to ensure that the structure of the scheme is sufficiently flexible to incorporate the ability to respond efficiently to make any changes and refinements that may be needed as the scheme develops and as the TGA, the new Australian bodies and manufacturers gain experience in operating under it. Providing for the details of the new scheme to be set out in regulations is designed to provide this critical flexibility and adaptability, while still ensuring appropriate Parliamentary oversight. Such an approach would also share similarities with other schemes in Commonwealth legislation that also set out important matters in rules or regulations, such as the Australian trusted trader programme under the Customs Act 1901 and the Anti-Money Laundering and Counter - Terrorism Financing Act 2006, and other regulatory schemes such as the Biosecurity Act 2015 and the Navigation Act 2012. This is also how existing requirements of medical device regulation operate, with the key criteria used for medical device evaluation - the Essential Principles for assessing safety, quality and performance, classification rules and conformity assessment procedures detailed in the Therapeutic Goods (Medical Devices) Regulations 2002 rather than the Therapeutic Goods Act 1989. Public consultation on the details of the Australian conformity assessment body scheme to be set out in the regulations has already been undertaken. Documents were released for this purpose on the TGA's website (www.tga.gov.au) on 16 November 2016, and submissions closed on 11 January 2017. Twelve submissions were received, with respondents indicating general support for the initiative and for having criteria for becoming such a body that are aligned with the approach for equivalent bodies in Europe. This feedback will inform the nature of the scheme to be outlined in regulations, and the TGA will work closely with stakeholders to conduct further, targeted consultations with 13

potential bodies, and with peak industry, patient and clinical bodies, ahead of those regulations being prepared. Item 1 This item inserts definitions for 'Australian conformity assessment body' and 'Australian corporation' into subsection 3(1) of the Act. An Australian conformity assessment body is an Australian corporation in relation to which the Secretary has made a conformity assessment body determination under the regulations. An Australian corporation is a corporation registered under Part 2A.2 of the Corporations Act 2001. Item 2 This item expands the definition of 'authorised person' in the Act to include a person authorised by the Secretary to exercise certain powers under the regulations, and not just under the Act. Item 3 This item inserts a definition for 'certification-related activities', and 'conformity assessment body determination'. When used in relation to an Australian conformity assessment body, certification-related activities means activities that consist of, or relate to, the issue of conformity assessment certificates mentioned in new section 41FIA. This item also inserts a definition for 'conformity assessment body determination', which has the meaning given by new section 41EWA (see Item 4 below). Item 4 This item inserts a new Part 4-4A into the Act, which includes new sections 41EWA and 41FIA that will enable the Secretary to designate eligible Australian corporations to be Australian conformity assessment bodies by way of a conformity assessment body determination. New subsection 41EWA(1) enables regulations to be made to empower the Secretary to effectively designate Australian corporations as conformity assessment bodies. New subsection 41EWA(2) inserts a definition for a 'conformity assessment body determination", which is a determination made by the Secretary that a specified Australian corporation is an "Australian conformity assessment body" that will be permitted to undertake assessments of practices and procedures employed in the manufacture of medical devices in Australia to establish whether medical devices manufactured by the manufacturer comply with essential principles that apply to those devices (essential principles represent standards for medical devices). Australian conformity assessment bodies may be permitted to undertake assessments of the manufacture of any kind of medical device, for the purposes of determining whether or not to issue conformity assessment certificates for those devices. A conformity assessment certificate may be issued to a manufacturer whose kind of medical devices demonstrate 14

compliance with essential principles. A conformity assessment certificate is required before devices may be included in the Register. Subject to certain exceptions, generally medical devices must be included in the Register before they may be lawfully supplied by their sponsors. New subsection 41EWA(3) will enable regulations to be made to provide for, among other things, how applications for conformity assessment body determinations may be made, the forms the Secretary may approve for this purpose, information that must accompany any application and applicable fees payable for applications. In relation to how such fees will be calculated, as with existing TGA fees and charges provided for in regulations (for example, application fees for the inclusion of medical devices in the Register, and fees relating to varying an entry in the Register), these fees will be calculated on a cost recovery basis, in accordance with the Australian Cost Recovery Guidelines Principally, this means the fees will reflect the amount of effort involved in processing applications and in assessing the suitability of applications for determinations for approval. A cost recovery impact statement (CRIS) will be completed and released on the TGA's website (www.tga.gov.au) prior to the commencement of such fees. In addition, any such fees will be the subject of further, specific consultation with industry before being included in regulations. As the TGA will also continue to undertake conformity assessments of medical devices itself after the Bill and the regulations commence, these fees will continue to be set on a cost recovery basis. It is also important to note that subsection 59(2) of the Act requires that any fees prescribed under the Act must not be such as to amount to taxation. New subsection 41EWA(4) provides that a conformity assessment body determination may be of general application, or be more specific and be limited to either specified kinds of medical devices or specified kinds of conformity assessment procedures, or both. New subsection 41EWA(5) enables the regulations to prescribe any conditions that may apply to a conformity assessment body determination or allow conditions to be specified in the determination. New subsection 41EWA(6) provides some examples of the kinds of conditions that may be prescribed in relation to conformity assessment body determinations. These conditions include permitting an authorised person to enter at any reasonable time any premises used by a conformity assessment body to carry on certification related activities relating to medical devices, and while on those premises inspect those premises or any certification related activities carried out in relation to medical devices, take photographs or other images or make recordings that relate to certification related activities being undertaken in relation to medical devices, make copies or inspect any documents concerning certificate related activities , and require the conformity assessment body to produce documents or provide information about the body's activities relating to medical devices. 15

In relation to what sanctions may be imposed on Australian conformity assessment bodies that breach conditions of their determinations, the only such sanction would be the revocation of their determination to act as a conformity assessment body. This is consistent with the power in Schedule 2 of the Bill for regulations to make provision for and in relation to empowering the Secretary to vary or revoke a determination. Any such action would be subject to review and appeal rights for the affected body, and it is envisaged there would also be a requirement for the Secretary to first give notice of any proposal to revoke, and to allow the body to make submissions on the proposed revocation, which the Secretary would have to consider before taking any action. In relation to the reference to an 'authorised person' in this context, this reference relates to the definition of that term in section 7A of the Act, which limits such persons to:  an officer of the Department of Health, or an officer of another Commonwealth department or authority; or  an officer of a department or authority of a State or a department or administrative unit or authority of a Territory, which has functions relating to health matters or law enforcement. In practice, however, these authorisations are provided to only a limited number of suitably trained persons. New subsection 41EWA(7) allows the regulations to make provision for the variation and revocation of a conformity assessment body determination. New subsection 41EWA(8) makes it clear that despite the specific powers and activities permitted to be prescribed in new subsections 41EWA(3) - (7), none of these provisions are intended to limit the broad regulation making power set out in new subsection 41EWA(1) that allow regulations to be made for and in relation to supporting the Secretary in making conformity assessment body determinations. New subsection 41EWA(9) makes it clear that while the Secretary is nominated as the person exercising powers or performing functions in connection with the designation of conformity assessment bodies, this does not preclude the regulations from allowing any of the Secretary's powers or functions under the regulations for the purposes of section 41EWA to be delegated. As with the majority of the Secretary's powers and functions under the Act, there is a practical need for appropriate delegations to ensure that decisions can be made in a timely fashion, and to support the objects of the Act which include the timely availability of therapeutic goods in, and exported from, Australia. Allowing for the delegation of the Secretary's functions and powers in the above areas of the Bill reflects these needs. The TGA makes many thousands of delegated decisions each year under the Act and regulations. For example in 2015-16, the TGA received 231 applications for new prescription medicines and extensions of indications of medicines, 177 applications for over the counter medicines, 1,832 applications for class 2 medical devices, 344 applications for class 3 medical devices and 49 applications for active implantable medical devices. It is not practical for one or a 16

small number of decision-makers to make these decisions (there is for example, only a single SES officer in the entire Department of Health who is engaged solely on medical device regulation) . Consistent with the Department's overall approach to delegations under the Act and regulations, administrative processes are in place to ensure that the Secretary's powers and functions under the amendments proposed by the Bill will be delegated to officers at an appropriate level of seniority and professional expertise, and to ensure that staff exercise delegations appropriately. For example, the delegation of the Secretary's current power to approve the importation and supply of unapproved medicines, biologicals and medical devices for which substitutes are unavailable or in short supply is limited under regulations made for the purposes of current paragraphs 57(8)(b) and 57(9)(b) of the Act to three positions at the First Assistant Secretary level of the Department's Health Products Regulation Group. Any regulations made for the purposes of the amendments in Schedule 2 of the Bill would maintain a similar approach. New subsection 41EWA(10) requires any conformity assessment body determination that is in force to be published on the Department's website. New subsection 41EWA(11) states clearly that conformity assessment body determinations made under the regulations are not legislative instruments. This subsection has been included to assist readers, as a conformity assessment body determination is not a legislative instrument within the meaning of subsection 8(1) of the Legislation Act 2003. New subsection 41EWA(12) provides that subsection 33(3AB) of the Act Interpretation Act 1901 does not apply to the specification of an Australian corporation in a conformity assessment body determination. This means that every company applying for such a determination must be identified in the determination. Item 5 This item inserts new section 41FIA. Where a sponsor applies to include a kind of medical device in the Register and the sponsor's application has been selected for audit, new section 41FIA allows the Secretary to have regard to a certificate issued by an Australian conformity assessment body for the purposes of determining whether the sponsor's kind of medical device should be included in the Register. The certificates issued by the Australian conformity assessment body would be a certificate indicating that the body is satisfied that devices of that kind comply with either the applicable essential principles and/or applicable conformity assessment procedures. For the Secretary to have regard to these certificates, the certificates issued by the Australian conformity assessment body must relate to kinds of devices which are within the scope of that conformity assessment body's determination, and relate to the specified conformity assessment procedure within the scope of that body's determination. 17

SCHEDULE 3 - Exemptions The amendments made under this Schedule in relation to the Therapeutic Goods Act 1989 will enable certain health practitioners to supply specified therapeutic goods not included in the Register to specified persons, or a class of persons, under a notification scheme, in lieu of applying to the Secretary for approval to do so. A New Tax System (Goods and Services Tax) Act 1999 Item 1 This item inserts a new paragraph in subsection 38-50(6) in order to extend the exemption from the Goods and Services Tax, which currently applies to drugs and medicinal products supplied under the Special Access and Authorised Prescriber Schemes, to unapproved therapeutic goods supplied under the new SAS notification scheme described in Item 4 of this Schedule. Therapeutic Goods Act 1989 Item 2 This item inserts a definition into subsection 3(1) of "health practitioner". A health practitioner includes not only medical practitioners but also other health professionals such as dentists, optometrists and medical radiation practitioners. Item 3 This item amends the heading to section 19 of the Act to more accurately describe the function of the section, which is about exempting certain therapeutic goods in particular circumstances from the requirement to be included in the Register before they may be lawfully supplied. Item 4 This item inserts new provisions that enable the Minister to make a legislative instrument setting out rules which authorise certain health practitioners to supply specific therapeutic goods or classes of therapeutic goods (being therapeutic goods not included in the Register by the relevant health practitioner) to specified classes of persons, in accordance with those rules. The rules can set out the circumstances under which the specified therapeutic goods or class of such goods may be supplied and any conditions that apply to such supply. These provisions are intended to enable nominated health practitioners to supply specified 'unapproved' medicines or therapeutic devices (i.e. medicines or therapeutic devices not included in the Register by the relevant health practitioner) to recipients, without having to seek TGA approval, providing they notify the Secretary about any such supply. The medicines and therapeutic devices which they will be able to supply under this scheme will be medicines and therapeutic devices having a level of risk that would be appropriate for supply under a notification scheme. In making rules by way of a legislative instrument the Minister will be required to comply with any requirements prescribed by the regulations, and any restrictions or other limitations that may be prescribed by the regulations. 18

New subsection 19(7C) requires those health practitioners authorised under new subsection 19(7A) to supply relevant therapeutic goods not included in the Register, and who also supply such goods in accordance with the Minister's rules, to notify the Secretary of each supply within 28 days after the supply occurs. Any notification must be in accordance with a form approved in writing by the Secretary, contain such information as may be required by the form. Any approval of a form may require or permit information to be provided in accordance with specified software requirements on a particular kind of data processing device or by way of a specified kind of electronic transmission. New subsection 19(7F) creates an offence of strict liability where a person fails to notify the Secretary, as required, of a supply of therapeutic goods authorised under rules made by the Minister under new subsection 19(7A), with a maximum penalty of 10 penalty units for an individual. This offence is consistent with the criteria outlined in the Attorney-General's Department's Guide to Framing Commonwealth Offences in relation to when it is appropriate for strict liability offences to apply, given that:  the offence in subsection 19(7F) is not punishable by imprisonment;  the maximum penalty is less than 60 penalty units for an individual - it is only 10 penalty units for an individual;  the offence will enhance the effectiveness of the scheme by deterring practitioners from failing to notify the TGA of the details it needs to verify compliance and that correct kinds of medicines are being supplied to the kinds of patients they are authorised for under the scheme; and  without such notifications, the TGA will not be able to ensure that the scheme is operating safely for patients. The legislation also already contains a small number of other, long-standing strict liability offences with similarly low maximum penalty levels - for example, if a sponsor of a prescription medicine or an over the counter medicine supplies their medicine without consumer medicine information, or if a sponsor of a medicine manufactured using a human embryo does not include certain information with their product when supplying it (regulations 9A and 9B of the Therapeutic Goods Regulations 1990 refer). Items 12 (proposed new subsection 32CM(7F) and 24 (proposed new subsection 41HC(6E) below create equivalent offences in respect of biologicals and medical devices respectively, and the same points as outlined above would apply in relation to those proposed offences. Item 5 This item inserts three new subsections into section 21A. New subsection 21A(11A) creates a corresponding offence for a health practitioner who supplies therapeutic goods purportedly under the Minister's rules for the notification scheme made under subsection 19(7A), but who fails to undertake the supply in compliance with those rules (e.g. the supply is not in accordance with those rules, is not undertaken in the 19

circumstances specified by those rules and the supply does not comply with the conditions specified for that supply). Three different penalties apply, depending on the outcome of a failure to comply with any aspect of the Minister's rules for the notification scheme. Where the use of the goods in breach of the rules this has resulted in, or will result in, harm or injury to any person, or where the use of the goods, if the goods were to be used, would result in harm or injury to any person, the highest level of penalty may apply which is a maximum of 5 years imprisonment or 4,000 penalty units, or both. Where the use of the goods in breach of the rules would be likely to result in harm or injury, this would attract 2,000 penalty units. Where no consequential harm or likelihood of harm may result, and there is a breach of any aspect of the Minister's rules, then the lowest penalty of 500 penalty units will apply. Item 6 This Item inserts new subsection 31B(3A) to enable the Secretary to obtain information or documents from health practitioners authorised to supply specified therapeutic goods under subsection 19(7A) about aspects of their supply. The Secretary may require such practitioners to provide information or documents about their supply of the goods, their handling of the goods, any monitoring of the supply of the goods, any results of any supply of the goods and any other matter prescribed in the regulations. Item 7 This Item makes consequential amendments to subsections 31B(4) and (5) of the Act to enable any requirement for information to be provided in accordance with specified software and to require any notice requiring information or documents to include a reasonable timeframe for responding, which must not be less than 14 days from the date the notice is given. Item 8 This Item provides for another consequential amendment to an existing offence in s.32BD, about any unlawful supply of a biological for use in humans, to include a reference to subsection 19(7A) so as to exclude from that offence any lawful supply of a biological that occurs under a notification scheme contained in rules made by the Minister under subsection 19(7A) of the Act. Item 9 This is a further consequential amendment to an existing civil penalty provision in s.32BF, about the unlawful supply of a biological, to include a reference to subsection 19(7A) so as to exclude from that civil penalty provision any lawful supply of a biological that occurs under a notification scheme provided for in rules made by the Minister under subsection 19(7A) of the Act. Item 10 This Item replaces the heading for Subdivision D of Division 3 of Part 3-2A of the Act with the following new heading: Subdivision D - Exempting biologicals for certain uses, which will reflect the addition of a further exemption for biologicals from the requirement to be 20

included in the Register if they are lawfully supplied under a notification scheme provided for in rules made by the Minister under new subsection 32CM(7A) of the Act. Item 11 This Item repeals the heading for section 32CM and replaces it with a new heading: 32CM Exemption for health practitioners. Item 12 This inserts new subsection 32CM(7A) which enables the Minister to make a legislative instrument setting out rules which authorise certain health practitioners to supply specific biologicals (being biologicals not included in the Register by those health practitioners supplying the goods) to a specified class or classes of recipients, in accordance with those rules. The rules can set out the circumstances under which the specified biological may be supplied and any conditions that apply to such supply. This section is intended to enable nominated health practitioners to supply specified 'unapproved' biologicals (i.e. biologicals not included in the Register by the health practitioners supplying these) to specified recipients, without having to seek TGA approval, providing they notify the Secretary about any such supply. The biologicals which they will be able to supply under this scheme will be biologicals having a level of risk that would be appropriate for supply under a notification scheme. In making rules by way of a legislative instrument the Minister will be required to comply with any requirements prescribed by the regulations, and any restrictions or other limitations that may be prescribed by the regulations. New subsection 32CM(7C) requires those health practitioners authorised under new subsection 32CM(7A) to supply relevant biologicals, and who also supply such goods in accordance with the Minister's rules, to notify the Secretary of each supply within 28 days after the supply occurs. Any notification must be in accordance with a form approved in writing by the Secretary, and contain such information as may be required by the form. Any approval of a form may require or permit information to be provided in accordance with specified software requirements on a particular kind of data processing device or by way of a specified kind of electronic transmission. New subsection 32CM(7F) creates an offence of strict liability where a person fails to notify the Secretary, as required, of a supply of biologicals authorised under rules made by the Minister under new subsection 32CM(7A). Item 13 This Item replaces the current heading for section 32CN with a new heading: "32CN Criminal offences relating to the giving of an authority to a health practitioner". Item 14 This Item is a drafting amendment to adopt a consistent style for describing offences in Commonwealth statutes. Item 15 This Item inserts three new subsections into the offence provisions in section 32CN. These 21

set out new offences for breaches of the arrangements made in relation to new subsection 32CM(7A), described in Item 12 above. New subsections 32CN(5), (6) and (7) create corresponding offences for a health practitioner who supplies biologicals purportedly under the Minister's rules for the notification scheme made under subsection 32CM(7A), but who fails to supply in compliance with those rules (e.g. the supply is not in accordance with those rules, is not undertaken in the circumstances specified by those rules and the supply does not comply with any conditions specified for that supply). Three different penalties apply, depending on the outcome of a failure to comply with the Minister's rules for the notification scheme. Where because of the use of the biologicals in breach of the rules, this has resulted in, or will result in, harm or injury to any person, or where the use of the goods, if the goods were to be used, would result in harm or injury to any person, the highest level of penalty may apply which is a maximum of 5 years imprisonment or 4,000 penalty units, or both. Where because of the use of the biologicals in breach of the rules harm or injury would be likely to result, this would attract a penalty of 2,000 penalty units. Where no consequential harm or likelihood of harm may result, and there is a breach of any aspect of the Minister's rules, then the lowest penalty of 500 penalty units will apply. Item 16 This Item inserts new subsection 32JG(3A) to enable the Secretary to obtain information or documents from health practitioners authorised to supply specified biologicals not included in the Register about aspects of their supply. The Secretary may require such practitioners to provide information or documents about their supply of the biologicals, their handling of the biologicals, any monitoring of the supply of the biologicals, any results of any supply of the biologicals and any other matter prescribed in the regulations. Item 17 This Item makes a consequential amendment to require any information or documents the Secretary has required to be given or produced under subsection 32JG(3) to be provided within the period specified in the Secretary's notice requiring the information or documents, being a period that is not less than 14 days, and be in a form specified by that notice. Item 18 This Item is a consequential amendment that amends the general description of Part 4-7 of the Act relating to exemptions for medical devices to be included in the Register, and changes the reference to authorisations of particular "medical practitioners" permitted to supply specified medical devices not included in the Register, to "health practitioners", to accommodate the supply by specified health practitioners of medical devices under a notification scheme set up under Ministerial rules made under new subsection 41HC(6) of the Act. Item 19 This Item is a consequential amendment that replaces the heading for section 41HC to remove the reference to "medical practitioners" in that provision dealing with exemptions 22

granted to certain person to enable them to supply medical devices that are not included in the Register to specified recipients. The replacement heading accommodates the addition of to "health practitioners" who are a new group of persons who may be granted authorisations to supply medical devices not included in the Register to specified persons. Items 20-23 These Items make consequential changes to subsections under section 41HC so that it is possible to distinguish between medical practitioners authorised to supply medical devices not included in the Register, and health practitioners who are authorised to supply medical devices not included in the Register pursuant to the new notification scheme made under Ministerial rules under new subsections 41HC(6) of the Act. Item 24 This item inserts new subsection 41HC(6)into the Act, which enables the Minister to make a legislative instrument setting out rules which authorise certain health practitioners to supply a specific kind or kinds of medical devices (being kinds of medical devices not included in the Register by the health practitioner) to specified classes of patients, in accordance with those rules. The rules can set out the circumstances under which the specified kind or kinds of medical devices may be supplied and any conditions that apply to such supply. This section is intended to enable nominated health practitioners to supply specified 'unapproved' kinds of medical devices (i.e. kinds of medical devices not included in the Register in relation to the health practitioner) to specified recipients, without having to seek TGA approval, providing they notify the Secretary about any such supply. The kinds of medical devices that they will be able to supply under this scheme will be those that have a level of risk that would be appropriate for supply under a notification scheme. In making rules by way of a legislative instrument the Minister will be required to comply with any requirements prescribed by the regulations, and any restrictions or other limitations that may be prescribed by the regulations. New subsection 41HC(6B) requires those health practitioners authorised under new subsection 41HC(6) to supply relevant kinds of medical devices, and who also supply such goods in accordance with the Minister's rules, to notify the Secretary of each supply within 28 days after the supply occurs. Any notification must be in accordance with a form approved in writing by the Secretary, contain such information as may be prescribed by the regulations. Any approval of a form may require or permit information to be provided in accordance with specified software requirements on a particular kind of data processing device or by way of a specified kind of electronic transmission. New subsection 41HC(6E) creates an offence of strict liability where a person fails to notify the Secretary, as required, of a supply of a kind of medical device authorised under rules made by the Minister under new subsection 41HC(6). Item 25 This Item replaces the heading for section 41JF with the new heading that takes into account "health practitioners" who are not medical practitioners, but from whom information may be 23

required by the Secretary, in order to monitor their supply of kinds of medical devices under the new notification scheme made under Ministerial rules pursuant to subsection 41HC(6) of the Act. Item 26 This Item makes a consequential amendment in relation to the Secretary's information gathering powers under section 42JF to distinguish between the supply of exempt medical devices by health practitioners under the section 41HC notification scheme, and the supply of medical devices by medical practitioners under a different scheme to the notification scheme provided for under Ministerial rules made under s.41HC(6). Item 27 This Item inserts new subsection 41JF(1A) to enable the Secretary to obtain information from health practitioners authorised to supply specified kinds of medical devices supplied under the notification scheme established under new subsection 41HC(6) about aspects of their supply. The Secretary may require such practitioners to provide information or documents about their supply of the medical devices, their handling of the medical devices, any monitoring of the supply of the medical devices, any results of any supply of the medical devices and any other matter prescribed in the regulations. Item 28 This Item amends subsection 41JF(2) to provide that where the Secretary requires information or documents from a health practitioner supplying a kind of medical device under the notification scheme, the notice requiring the information must specify a reasonable period within which the information or documents must be provided, being a period that is not less than 10 working days from the date the notice is given. Item 29 This Item makes a consequential amendment to subsection 41JF(3) to enable any requirement for information to be provided by a health practitioner to be provided in accordance with any specified software. Item 30 This Item makes consequential amendments to the offences provision in s.41MO to differentiate between offences that apply in relation to medical practitioners supplying kinds of medical devices pursuant to an exemption scheme that differs to the exemption scheme under which health practitioners supply kinds of medical devices under Ministerial rules made under s.41HC(6). Item 31 This Item inserts three new offences into section 41MO of the Act. New subsections 41MO(4A), (4B)and (4C) create corresponding offences for a health practitioner who supplies a kind of medical device purportedly under the Minister's rules for the notification scheme made under subsection 41HC(6), but who fails to undertake the supply in compliance with those rules (eg the supply is not in accordance with those rules, is 24

not undertaken in the circumstances specified by those rules and the supply does not comply with any conditions specified for that supply). Three different penalties apply, depending on the outcome of a failure to comply with any aspect of the Minister's rules for the notification scheme. Where because of the use of the medical devices in breach of the rules this has resulted in, or will result in, harm or injury to any person, or where the use of the medical devices, if they were to be used, would result in harm or injury to any person, the highest level of penalty may apply which is a maximum of 5 years imprisonment or 4,000 penalty units, or both. Where because of the use of the medical devices in breach of the rules harm or injury would be likely to result, this would attract 2,000 penalty units. Where no consequential harm or likelihood of harm may result, and there is just a breach of any aspect of the Minister's rules, then the lowest penalty of 500 penalty units will apply. Items 32, 33 and 34 These Items amend the table in section 53A that sets out the availability of convictions for alternative verdicts for certain offences, to include the new offences under subsections 21A(11A)/21A(11C); 32CN(5)/32CN(7) and 41MO(4A)/41MO(4C). Items 35, 36 and 37 These Items make consequential changes to section 56A, to preserve the status quo in relation to the list of matters that may be certified by the Secretary that can be treated as evidence of those matters for the purposes of litigation. The amendments will have the effect of not allowing, for the purposes of section 56A, any certifications to be made about the new notification schemes made under Ministerial rules pursuant to new subsections 19(7A) and 41HC(6) of the Act. 25

SCHEDULE 4 - Committees This Schedule alters the requirements for the Minister to consult with Committees under the Act. Items 1 and 2 These items repeal subsection 10(4) and 36(3) of the Act. The repeal of subsection 10(4) will remove the requirement for the Minister, when making standards for medicines and other therapeutic goods, to consult the Therapeutic Good Committee, which will cease to exist from 1 January 2017 and will be replaced by other statutory committees with functions that include providing advice on a range of matters including standards for relevant types of therapeutic goods. The Minister will have the option of consulting any one or more of the new replacement committees about matters that include standards. The repeal of subsection 36(3) will remove the reference to the Minister's discretion to obtain advice from a statutory Committee before determining manufacturing principles. Not all standards or manufacturing principles, or amendments to these instruments, need the technical input of an advisory committee -for example, where a proposed standard has already been the subject of detailed, in-depth consultation with industry, consumers and health practitioners, or where a proposed amendment would mainly update references to international standards that stakeholders are already familiar with and support the adoption. Removing the obligation to always be required to consult a committee will streamline the standard - making process, but will still leave the decision-maker the discretion to consult an advisory committee on a proposed standard if there are issues that would benefit from that advice. Removing the reference to consulting a committee in relation to manufacturing principles will avoid confusion as to whether or not this is a necessary step, but will also not preclude decision - makers from first consulting an advisory committee before making these legislative instruments if they wish to do so. The Therapeutic Goods Committee no longer exists, but the functions of a number of advisory committees were amended to incorporate the capacity to provide advice and make recommendations on matters relating to standards (e.g. the Advisory Committee on Medicines, and the Advisory Committee on Complementary Medicines (sections 35A and 39A of the Therapeutic Goods Regulations 1990 refer)). Such committees will continue to be consulted for significant standards and manufacturing principles, and major changes to such instruments (such as changes to adopt a new set of requirements for sponsors), and the TGA will develop guidelines to explain the process for this consultation. 26

SCHEDULE 5 - Permissible ingredients This Schedule implements Review Recommendation 47, in relation to providing review and appeal rights for persons who apply to have new ingredients permitted for use in listed complementary medicines. Under the Act, the Minister may make a legislative instrument setting out the ingredients that may be used in these medicines, and related requirements (e.g. in relation to concentration of an ingredient in a product, or maximum daily dose). The Minister may vary the instrument at his or own initiative, and persons may apply to the Minister for a variation of the instrument, however, review and appeal rights are not currently provided for any such applicants. Items 1, 2 and 3 Items 1 and 2 replace the current arrangements in section 26BD of the Act for persons to apply to the Minister for a variation to the permissible ingredients legislative instrument made by the Minister under section 26BB of the Act, with revised arrangements to incorporate a new step for the Secretary to make a recommendation to the Minister about such variations, in order to accommodate the provision of review and appeal rights for applicants for new ingredients. Under the new arrangements (set out in new section 26BE), a person may apply to the Secretary for a recommendation that the Minister vary the instrument. Provided that such applicants use the approved form and pay any prescribed application and evaluation fees, the Secretary must evaluate the application and either make the requested recommendation to the Minister, or refuse to do so. In coming to his or her view in this regard, the Secretary must take into account the quality and safety of the ingredient concerned, and any other matter the Secretary considers relevant (effectively this mirrors the Minister's obligation in considering proposed variations to the instrument currently). The effect of the introduction of this step for persons to apply at first instance to the Secretary, and for the Secretary to either make a recommendation to the Minister about a variation or to refuse to do so, is to provide for review and appeal rights for such applicants. This is because, under paragraph 60(1)(c) of the Act, any decision of the Secretary or delegate under Part 3-2 of the Act is an initial decision that may be reviewed by the Minister (with any decision by the Minister able to be reviewed in turn by the Administrative Appeals Tribunal). In relation to application and evaluation fees relating to such requests, it is important to note that TGA fees and charges - including fees relating to requests for new ingredients - are calculated on a cost recovery basis, in accordance with the Australian Cost Recovery Guidelines. The current evaluation fees for applications for new ingredients for listed complementary medicines - which will remain in place after the Bill - reflect the cost to TGA of evaluating the suitability of a possible new ingredient, including assessing the dossiers of information provided in support of the application. 27

Further, subsection 59(2) of the Act also requires that any fees prescribed under the Act must not be such as to amount to taxation. This provision would appear to address the concerns raised by the Committee in paragraph 1.77 of its Scrutiny Digest No.1 of 2017. There are currently no application fees for these applications. If such fees are proposed in the future, they would be expected to be low, and to be based on the cost of the administrative and technical screening of new ingredient applications before an evaluation commences. This may include, for example, the processing cost of examining whether an application has been made in accordance with the relevant approved form, and whether it contains enough information to proceed with the evaluation. Item 3 amends section 60 of the Act, with the effect that the introduction of review and appeal rights only applies in respect of persons who apply to the Secretary for a recommendation about a variation of the permissible ingredients legislative instrument, and where the Secretary refuses to make the requested recommendation. This will encompass persons seeking a recommendation about the approval of a new ingredient for use in these medicines (and therefore implement Review recommendation 47), as well as persons seeking other kinds of variations to the instrument (e.g. in relation to daily dose or concentrations restrictions in relation to ingredients). The targeting of the provision of review and appeal rights to the persons applying to the Secretary for a recommendation about a variation to the permissible ingredients instrument is designed to reflect governments' acceptance of the Review recommendation that such rights be specifically provided for applicants seeking the approval of new ingredients for use in these medicines. Item 4 This item would include a transitional provision, the principal effect of which would be to ensure that the current section 26BD of the Act would continue to apply, after the commencement of this Schedule, to any application for a variation to the permissible ingredients legislative instrument that is already underway at the time that this Schedule commences. 28

SCHEDULE 6 - Approval of therapeutic goods, biologicals and medical devices This Schedule establishes the foundations for schemes of priority approval of therapeutic goods, biologicals and medical devices. Item 1 This item inserts new section 25AAA which will enable regulations to be made so that the Secretary can make therapeutic goods (priority applicant) determinations for registrable therapeutic goods covered by part 3-2 of Chapter 3 of the Act. A description of a "therapeutic goods (priority application) determination" is set out in subsection 25AAA(2). It is a determination that a specified person is a priority applicant in relation to any s.23 application that may be made by the person for the registration of therapeutic goods specified in the determination. Regulations may be made to provide for applications for these determinations, the form in which they must be made, the application fee for these determinations and the information that must be submitted as part of an application. The regulations can also provide for the Secretary to revoke a therapeutic goods (priority applicant) determination, and prescribe the consequences of any revocation. The description of what regulations may do under new subsections 25AAA(3) and (4) will not place any limitations on the breadth of the regulation power set out under subsection 25AAA(1) to make regulations for and in relation to empowering the Secretary to make these priority determinations. The regulations may prescribe shorter times for the evaluation of applications lodged by priority applicants. The regulations may also provide for the publication of a statement about a decision on an application for registration or listing, where the person is a priority applicant on the Department's website. While a priority applicant determination is in force under the regulations, that determination may be published on the website. New subsection 25AAA(1) provides that a therapeutic goods (priority application) determination made under the regulations is not a legislative instrument. This statement is for the benefit of readers, as the instrument is not a legislative instrument within the meaning of subsection 8(1) of the Legislation Act 2003. Also, subsection 33(3AB) of the Acts Interpretation Act 1901 does not apply to the specification of a person in a therapeutic goods (priority applicant) determination. This means that each person applying for such a determination must be identified in the determination. New subsection 25AAA(8) would provide that the express references in section 25AAA do not prevent the regulations from empowering the Secretary to delegate any or all of the Secretary's functions or powers under regulations made for the purposes of new section 25AAA. As with the majority of the Secretary's powers and functions under the Act, there is a practical need for appropriate delegations to ensure that decisions can be made in a timely fashion, and to support the objects of the Act which include the timely availability of therapeutic goods in, and exported from, Australia. Allowing for the delegation of the 29

Secretary's functions and powers in the above areas of the Bill reflects these needs. The TGA makes many thousands of delegated decisions each year under the Act and regulations. For example in 2015-16, the TGA received 231 applications for new prescription medicines and extensions of indications of medicines, 177 applications for over the counter medicines, 1,832 applications for class 2 medical devices, 344 applications for class 3 medical devices and 49 applications for active implantable medical devices. It is not practical for one or a small number of decision-makers to make these decisions. Consistent with the Department's overall approach to delegations under the Act and regulations, administrative processes are in place to ensure that the Secretary's powers and functions under the amendments proposed by the Bill will be delegated to officers at an appropriate level of seniority, and to ensure that staff exercise delegations appropriately. For example, the delegation of the Secretary's current power to approve the importation and supply of unapproved medicines, biologicals and medical devices for which substitutes are unavailable or in short supply is limited under regulations made for the purposes of current paragraphs 57(8)(b) and 57(9)(b) of the Act to three positions at the First Assistant Secretary level of the Department's Health Products Regulation Group. Any regulations made for the purposes of proposed new sections 25AAA of the Bill (and equivalent new provisions relating to biologicals, conformity assessments and medical devices outlined below) would maintain this approach. Item 2 This Item inserts new section 32DEA which will enable regulations to be made so that the Secretary can make biologicals (priority applicant) determinations for applicants applying to include biologicals in the Register under s.32DD of the Act. A description of a "biologicals (priority application) determination" is set out in subsection 32DEA(2). It is a determination that a specified person is a priority applicant in relation to any section 32DD application that may be made by the person for the inclusion in the Register of biologicals specified in the determination. Regulations may be made to provide for applications for these determinations, the form in which they must be made, the application fee for these determinations and the information that must be submitted as part of an application. The regulations can also provide for the Secretary to revoke a biologicals (priority applicant) determination, and prescribe the consequences of any revocation. The description of what regulations may do under new subsections 32DEA(3) and (4) will not place any limitations on the breadth of the regulation power set out under subsection 32DEA(1) to make regulations for and in relation to empowering the Secretary to make these priority determinations. The regulations may prescribe shorter times for the evaluation of applications lodged by priority applicants. The regulations may also provide for decisions about who has been successful in obtaining status as a priority applicant to be published on the Department's website. While a priority applicant determination is in force under the regulations, that determination may be published on the website. 30

New subsection 32DEA(10) provides that a biologicals (priority application) determination made under the regulations is not a legislative instrument. This statement is for the benefit of readers, as the instrument is not a legislative instrument within the meaning of subsection 8(1) of the Legislation Act 2003. Also, subsection 33(3AB) of the Acts Interpretation Act 1901 does not apply to the specification of a person in a biologicals (priority applicant) determination. This means that each person applying for such a determination must be identified in the determination. Item 3 This Item inserts new section 41ECA which will enable regulations to be made so that the Secretary can make conformity assessment (priority applicant) determinations for applicants applying for a conformity assessment certificate under section 41EB of the Act. A description of a "conformity assessment (priority application) determination" is set out in subsection 41ECA(2). It is a determination that a specified person is a priority applicant in relation to any section 41EB application that may be made by the person for a conformity assessment certificate. Regulations may be made to provide for applications for these determinations, the form in which they must be made, the application fee for these determinations and the information that must be submitted as part of an application. The regulations can also provide for the Secretary to revoke a conformity assessment (priority applicant) determination, and prescribe the consequences of any revocation. The description of what regulations may do under new subsections 41ECA(3) and (4) will not place any limitations on the breadth of the regulation power set out under subsection 41ECA(1) to make regulations for and in relation to empowering the Secretary to make these priority determinations. The regulations may prescribe shorter times for the evaluation of applications lodged by priority applicants. The regulations may also provide for decisions about who has been successful in obtaining status as a priority applicant to be published on the Department's website. While a priority applicant determination is in force under the regulations, that determination may be published on the website. New subsection 41ECA(10) provides that a conformity assessment (priority application) determination made under the regulations is not a legislative instrument. This statement is for the benefit of readers, as the instrument is not a legislative instrument within the meaning of subsection 8(1) of the Legislation Act 2003. Also, subsection 33(3AB) of the Acts Interpretation Act 1901 does not apply to the specification of a person in a conformity assessment (priority applicant) determination. This means that each person applying for such a determination must be identified in the determination. Item 4 This Item inserts new section 41FKA which will enable regulations to be made so that the Secretary can make medical devices (priority applicant) determinations for applicants applying to include a kind of medical device in the Register under s.41FC of the Act. 31

A description of a "medical devices (priority application) determination" is set out in subsection 41FKA(2). It is a determination that a specified person is a priority applicant in relation to any section 41FC application that may be made by the person for the inclusion of a medical device of a kind specified in the determination. Regulations may be made to provide for applications for these determinations, the form in which they must be made, the application fee for these determinations and the information that must be submitted as part of an application. The regulations can also provide for the Secretary to revoke a medical devices (priority applicant) determination, and prescribe the consequences of any revocation. The description of what regulations may do under new subsections 41FKA(3) and (4) will not place any limitations on the breadth of the regulation power set out under subsection 41FKA(1) to make regulations for and in relation to empowering the Secretary to make these priority determinations. The regulations may prescribe shorter times for the evaluation of applications lodged by priority applicants. The regulations may also provide for decisions about who has been successful in obtaining status as a priority applicant to be published on the Department's website. While a priority applicant determination is in force under the regulations, that determination may be published on the website. New subsection 41FKA(10) provides that a medical devices (priority application) determination made under the regulations is not a legislative instrument. This statement is for the benefit of readers, as the instrument is not a legislative instrument within the meaning of subsection 8(1) of the Legislation Act 2003. Also, subsection 33(3AB) of the Acts Interpretation Act 1901 does not apply to the specification of a person in a medical devices (priority applicant) determination. This means that each person applying for such a determination must be identified in the determination. 32

SCHEDULE 7 - Time limits This Schedule contains an amendment to the regulation-making power in section 63 of the Act to support the implementation of Review recommendation 41 in relation to the specification of time periods within which the Secretary must complete actions or make decisions under the Act. Item 1 This item amends section 63 of the Act to add new paragraphs 63(2)(de) and (df), the effect of which is to enable regulations to be made to prescribe time periods within which the Secretary must complete specified functions under the Act and within which the Secretary must make specified decisions under the Act. 33

SCHEDULE 8 - Record-keeping etc. This Schedule sets out a number of amendments to the Act to support the implementation of Review recommendation 27 in relation to developing a more comprehensive post-market monitoring scheme for medicines. Items 1, 2 and 3 Under paragraph 28(5)(a) of the Act currently, sponsors of registered or listed goods must allow authorised persons to enter, at any reasonable time, premises at which a person deals with the goods. Item1 amends paragraph 28(5)(a) of the Act to introduce a new condition to also require sponsors of registered or listed goods to allow an authorised person to enter premises where record-keeping requirements are complied with in relation to their goods, to verify compliance with those requirements. The record-keeping requirements referred to relate to:  the current requirement in paragraph 28(5)(c) of the Act for sponsors to keep a record in relation to each batch of their goods for at least 12 months after the goods' expiry of all of the manufacturers involved in the manufacture of that batch; and  any other record-keeping requirements that are prescribed in regulations for the purposes of new paragraph 28(5)(ca) (item 3 below refers). Item 2 of the Bill makes a consequential amendment to allow an authorised person to inspect and make copies of any records kept in compliance with these requirements, and any documents that relate to the goods in question. Item 3 of the Bill introduces a new power to prescribe additional record-keeping requirements in the regulations. Item 4 Item 4 of the Bill amends paragraph 28(5)(d) of the Act to specify that the records that a sponsor may be required to produce by an authorised person are the records of all manufacturers involved in the manufacture of a particular batch of therapeutic goods, and any records required to be kept by the regulations. Item 5 Item 5 of the Bill makes a related amendment to section 46A of the Act (which deals with the powers of an authorised person to enter and search a range of premises including those of sponsors of registered or listed goods, otherwise than as a condition of registration or listing), with the effect of permitting authorised officers to search such sponsors' premises that are connected with the keeping of records in accordance with the above record-keeping conditions. These amendments will enable authorised officers to enter premises where sponsors' records about their goods are kept but where the goods themselves are not dealt with - for example, if 34

a sponsor has a number of sites where it undertakes a range of activities including a separate administrative centre where records are kept (section 28 of the Act currently only allows authorised persons to enter premises where sponsors of registered or listed goods deal with their goods). 35

SCHEDULE 9 - Applications for variations of entries in Register Item 1 This Item amends subsection 9D(7) of the Act in relation to the circumstances in which applications to vary an entry in the Register for a registrable medicine (or any other prescribed kind of therapeutic good) will not be considered to be effective. Item 1 would insert new paragraph 9D(7)(g), to provide further grounds on which such applications will not be effective. These additional grounds are where the application is not accompanied by information that the Secretary has determined in a legislative instrument under new subsection 9D(8), and where the application is not in a form approved in writing by the Secretary. Item 2 New subsection 9D(8) enables the Secretary to determine a kind of information that must accompany an application to vary an entry in the Register for the purposes of subparagraph 9D(7)(g)(i). Item 3 This amendment will only affect applications made after these measures commence to operate. 36

SCHEDULE 10 - Public notification and recalls This schedule makes a number of changes to update the terminology of the provisions in the Act dealing with, or referring to, action that may be taken by the Secretary to require persons to recall therapeutic goods. This schedule also amends the Act to enable the Secretary to require sponsors of therapeutic goods, and other persons engaged in the supply of therapeutic goods, to tell the Secretary about the persons to whom goods have been supplied, and to inform the public or users of particular goods about any of the matters that may give rise to recall action by the Secretary under the Act. Items 1 and 2 These items make minor changes to replace the reference to "recovery" of therapeutic goods in the heading for Division 2A of Part 3-2 of the Act, and in the heading of section 30EA of the Act, with a reference in each case to "recall". "Recall" is considered to be a more up to date term than "recovery" for the kinds of actions that the Secretary may take under section 30EA in relation to registered or listed therapeutic goods or goods that are exempt or otherwise approved from the requirement to be registered or listed (and under other relevant sections of the Act in relation to biologicals and medical devices) to ensure the safety of therapeutic goods in the marketplace. Items 3, 24-27 and 29, and 41-44 Item 3 amends the grounds on which the Secretary may require a person to take specified recall actions under items 1-4 in the table in section 30EA (for example, where therapeutic goods do not comply with an applicable standard), to clarify that the Secretary has the power to do so where satisfied that those grounds apply. Items 24-27 , and 29, make equivalent amendments to items 1-4, and 8, of the table in section 32HA of the Act in relation to biologicals. Items 41-44 make equivalent amendments to items 1-4 of the table in section 41KA of the Act in relation to medical devices. Items 4 and 5 Item 4 amends item 5 in the table in section 30EA, principally to remove the reference to subsection 42E(1) and section 42EA of the Act from that table item. Item 5 introduces a new item 8 to the table in section 30EA, which refers to goods that are counterfeit within the meaning of that term in section 42E of the Act. The effect of these two amendments is to clarify when the Secretary may require a person supplying goods under section 30EA of the Act to take specified recall action in relation to counterfeit goods - under the changes, the Secretary will be able to require such action at any time in respect of goods that are counterfeit as defined in section 42E of the Act. Section 42E of the Act says that goods are counterfeit if their label or presentation or any document or record relating to the goods or their manufacture, or any advertisement for the goods, contains a false representation about a matter listed in subsection 42E(3), including for example in relation to the identity or name of the goods, or their formulation, composition or design specification. 37

Item 28 makes an equivalent amendment to table item 7 in section 32HA of the Act in relation to biologicals, and item 37H amends the table in section 41KA of the Act to a new grounds for the Secretary to take recall action in relation to medical devices, being where the devices in question are counterfeit within the meaning of that term in section 42E. Item 7, 31 Item 7 amends subsection 30EA(2) of the Act to add a new paragraph 30EA(2)(ba), the effect of which is to allow the Secretary to require a person in relation to whom he or she may impose recall action requirements under section 30EA of the Act to inform the public or a specified class of persons about the goods in question and the circumstances giving rise to the goods' recall under the Act (e.g. if the goods have been cancelled from the Register, or if the Secretary is satisfied that the goods' safety, quality or efficacy is not acceptable). Item 31 makes an equivalent amendment in respect of biologicals. Item 8, 32 Item 8 amends subsection 30EA(2) of the Act to add a new paragraph 30EA(2)(d), the effect of which is to allow the Secretary to require a person in relation to whom he or she may impose recall action requirements under section 30EA of the Act to notify the Secretary of specified information, or information of a specified kind, about the persons to whom the goods in question have been supplied. Item 32 makes an equivalent amendment to the Act in respect of biologicals. Items 46 and 48 Item 46 makes a minor formatting amendment to subsection 41KA(2) of the Act, to reflect the amendments made by item 42. Item 48 amends subsection 41KA(2) of the Act to make equivalent amendments to items 6 and 27, and 7 and 28, above in respect of medical devices, and to also allow the Secretary to require a person in relation to whom he or she may impose recall action requirements under section 41KA of the Act to publish specified information, or information of a specified kind, about the manufacture or distribution of the devices in question. Items 6, 9, 10, 12, 13, 14, 16-23, 30, 33, 34, 36-40, 47, 49, 50, 52-61 These items amend a number of provisions in the Act to replace references to "recovery" with "recall" or "recovered" with "recalled", including in a number of headings throughout the Act. Items 11, 15, 20, 35 and 51 These items would make it clear that the amendments in this Schedule are not intended to exclude or limit the operation of any other law of the Commonwealth or any law of a State or Territory, including for example the Australian Consumer Law. Item 62 This item would amend subsection 61(4A) of the Act, to allow the Secretary to provide information about recall action taken by the Secretary under section 32HA of the Act in 38

relation to biologicals, or under section 41KA of the Act in relation to medical devices, to either of the following:  an authority of the Commonwealth or of a State or Territory that has functions relating to therapeutic goods, health or law enforcement, or  a national regulatory authority of another country with national responsibility relating to therapeutic goods, or  an international organisation with functions relating to therapeutic goods, health or law enforcement. This would bring the Secretary's power to release information about recall action undertaken under the Act in relation to biologicals and medical devices into line with the Secretary's power to provide such information about registered or listed therapeutic goods (primarily medicines). Item 63 This item provides that:  the amendments to section 30EA of the Act in this Schedule apply in relation to requirements imposed after the commencement of this item;  the amendments to sections 30F and 32CJ of the Act in this Schedule apply in relation to notices given after the commencement of this item;  the amendments to section 32HA of the Act in this Schedule apply in relation to requirements imposed after the commencement of this item;  the amendments to section 41KA of the Act in this Schedule apply in relation to requirements imposed after the commencement of this item;  the amendments to sections 41MP and 41MPA of the Act in this Schedule apply in relation to steps taken after the commencement of this item; and  the amendments to sections 42V, 42VA, 42VB and 42W of the Act in this Schedule apply in relation to requirements imposed after the commencement of this item. 39

SCHEDULE 11 - Obtaining information etc. Item 1 Currently, sponsors of listed medicines may have their goods included in the Register if they certify various matters that amount to a confirmation that their goods meet all criteria that would enable their medicines to be listed in the Register - these criteria include safety, quality, eligibility for listing, compliance with applicable standards etc. Falsely certifying any of those matters would be a potential ground for cancelling the listing of the goods in the Register. Item 1 amends subsection 31(2) to allow the Secretary to obtain information from the sponsor about any of the matters a sponsor has certified, so that not only can the Secretary establish whether or not the sponsor's goods qualify for listing in the Register, but also whether after listing in the Register, the goods may remain in the Register because they continue to meet the regulatory requirements that apply to listed goods. Item 2 The changes effected by this Schedule apply to notices given under section 31 after the commencement of this Item, whether or not the notice is given to an applicant who applied for registration or listing of therapeutic goods before the commencement of these amendments. This amendment also applies to any notices issued after the commencement of this provision to a person whose goods are or were registered or listed before or after this provision commenced to operate. 40

SCHEDULE 12 - Miscellaneous amendments This Schedule sets out a number of minor amendments to the Act, that are intended to either achieve greater consistency across the regulation of different kinds of therapeutic goods under the Act, reduce regulation, reduce health risks to the public or make other, quite minor changes. New power for the Secretary to approve unapproved goods in the event of a shortage - registered or listed goods Items 2, 4, 5, 11-16 and 56 Currently under section 19A the Act, the Secretary can approve the importation and supply of unapproved medicines if satisfied that registered goods that could act as a substitution are either not available or are in short supply. The unapproved goods in question must either be registered or approved for general marketing in a foreign country specified by the Secretary in a legislative instrument under subsection 19A(3) of the Act (currently 9 countries are listed for this purpose), or be the subject of an application for registration in Australia. There are instances, however, when the only unapproved medicines that are available globally to address a shortage are not available in any of the countries that the Secretary has specified. To address this concern and to provide greater flexibility for the Secretary to allow the importation and supply of unapproved medicines to address medicines shortages, item 2 introduces a new subsection 19A(1A), the main effects of which are to allow the Secretary to approve the importation and supply of medicines in the event of a shortage if satisfied that:  the medicines that are needed are not registered or approved for marketing in any of the countries specified by the Secretary in a legislative instrument under subsection 19A(3), or if they are approved in such a country, they are not readily available for importing into Australia, but are registered or approved for general marketing in another country;  the manufacturing and quality control procedures used in the production of the medicines are acceptable; and  the approval is necessary in the interests of public health. Item 3 makes a minor amendment to subsection 19A(3) to avoid an inconsistency with the amendments made by item 5 above. Item 4 makes a minor, consequential amendment to ensure that, as with approval under section 19A currently, an approval under these new arrangements lapses if the Secretary is satisfied that the circumstances outlined above no longer apply, or that a condition of an approval under these new arrangements has been breached. Item 5 makes it clear that an approval granted under new subsection 19(1A) is not a legislative instrument - this is intended for the assistance of readers only, as such an approval 41

would not be within the meaning of a legislative instrument in subsection 8(1) of the Legislation Act 2003. Items 11, 13, 15 and 16 make related amendments to:  introduce a power for the Secretary to, by written notice, require a person granted an approval to import or supply goods under new subsection 19(1A) to provide information or documents about matters relating to that importation or supply within the period specified in the notice (which must not be less than 14 days from the date of the notice);  amend section 31C of the Act to provide that it is an offence for a person to whom the Secretary has issued such a notice to fail to comply with it (maximum penalty 400 penalty units);  amend sections 31D and 31E of the Act provide that is an offence for a person to whom the Secretary has issued such a notice to knowingly provide information or documents to the Secretary that are false or misleading;  amend section 31F to cover a person to whom the Secretary has issued such a notice with the self-incrimination arrangements already in place under that section. Item 12 makes a minor change to the heading of section 31C of the Act to reflect the second dot point above, and item 14 makes a minor change to section 31D to reflect the third dot point above in respect of section 31D. Item 56 makes a consequential amendment to section 61 of the Act (Release of information), with the effect of allowing the Secretary to release to a Commonwealth, State or Territory authority with functions relating to therapeutic goods, the registration of medical practitioners or the registration of pharmacists, information obtained under the new power to require information from a person granted an approval under new subsection 19A(1A). New power for the Secretary to approve unapproved goods in the event of a shortage - biologicals Item 17-22, 25-28, 30--33, 50, 54 and 57 Item 25 amends section 32CO of the Act to make an equivalent amendment to item 2 above in relation to biologicals, to allow the Secretary the same additional flexibility to approve the importation and supply of unapproved biologicals in the event of a shortage (new subsection 32CO(1A)). Items 17-22 make consequential amendments to a number of existing criminal offences and one civil penalty provision in the Act relating to biologicals (including, for example, in relation to wholesale supply of a biological, and using a biological that is not included in the Register), to ensure that a person who imports or supplies an unapproved biological in accordance with an approval under new section 32CO(1A) will not contravene these offences or civil penalty provision in doing so. 42

Item 23 makes a consequential amendment to the civil penalty provision in section 32BK of the Act for making misrepresentations about biologicals, with the effect that a person may contravene that section if they make a representation that a biological is the subject of an approval under the Secretary's new power to approve the importation or supply of biologicals in the event of a shortage and that representation is false or misleading. Item 26 makes a consequential amendment to provide that it is an offence for a person who breaches a condition of an approval granted under the Secretary's new power in respect of unapproved biologicals (maximum penalty 60 penalty units), and item 27 makes a consequential amendment to ensure that, as with approval under section 32CO currently, an approval under these new arrangements lapses if the Secretary is satisfied that the circumstances in which the approval may be granted no longer apply. Item 28 makes it clear that an approval granted under new subsection 32CO(1A) is not a legislative instrument - this is intended for the assistance of readers only, as such an approval would not be within the meaning of a legislative instrument in subsection 8(1) of the Legislation Act 2003. Items 30, 31 and 32 make consequential amendments to the grounds on which the Secretary may require the taking of recall action in relation to biologicals under section 32HA of the Act. These changes permit the Secretary to require such action if biologicals approved under new subsection 32CO(1A) are being supplied but do not comply with an applicable standard or have not been manufactured in accordance with the manufacturing principles or where biologicals are being supplied in circumstances where there is no authority under the Act for that supply, including that the Secretary has not granted an approval under new subsection 32CO(1A) in relation to the biological. Item 33 also makes a consequential amendment, to allow the Secretary to require a person granted an approval under new subsection 32CO(1A) to provide information or documents about matters relating to their importation or supply of biologicals under that approval. Item 50 makes a consequential amendment to section 46A of the Act to allow authorised persons to, in accordance with that section, search the premises of a person granted an approval under new subsection 32CO(1A) to monitor compliance with the Act. Item 54 makes a consequential amendment to section 56A of the Act, to allow the Secretary to certify that, at a specified time or times, there was no approval under new subsection 32CO(1A) in place in relation to a particular person and particular biological. Item 57 makes a consequential amendment to section 61 of the Act (Release of information), with the effect of allowing the Secretary to release to a Commonwealth, State or Territory authority with functions relating to therapeutic goods, the registration of medical practitioners or the registration of pharmacists, information obtained under the new power to require information from a person granted an approval under new subsection 32CO(1A). 43

New power for the Secretary to approve unapproved goods in the event of a shortage - medical devices Items 37-48, 51 and 53 Item 37 amends section 41HD of the Act to make an equivalent amendment to items 2 and 25 above in relation to medical devices, to allow the Secretary the same additional flexibility to approve the importation and supply of unapproved medical devices in the event of a shortage (new subsection 41HD(1A)). Item 38 makes a consequential amendment to ensure that an approval under new subsection 41HA(1A) lapses if the Secretary is satisfied that the circumstances in which the approval may be granted no longer apply. Item 39 makes it clear that an approval granted under new subsection 41HA(1A) is not a legislative instrument - this is intended for the assistance of readers only, as such an approval would not be within the meaning of a legislative instrument in subsection 8(1) of the Legislation Act 2003. Item 40 makes a consequential amendment to allow the Secretary to require a person granted an approval under new subsection 41HD(1A) to provide information or documents about matters relating to their importation and supply of medical devices under that approval. Items 41, 42 and 43 make consequential amendments to the grounds on which the Secretary may require the taking of recall action in relation to medical devices under section 41KA of the Act. These changes permit the Secretary to require such action if medical devices approved under new subsection 41HD(1A) are supplied but do not comply with the essential principles (these are minimum standards for the safety and performance of medical devices) or relevant conformity assessment procedures (these are requirements relating to the manufacturing of devices) or if devices are being supplied in circumstances where there is no authority under the Act for that supply, including that the Secretary has not granted an approval under new subsection 41HD(1A) in relation to the devices. Items 44-46 make consequential amendments to a number of existing criminal offences and one civil penalty provision in the Act in relation to medical devices (including, for example, in relation to wholesale supply of a medical device not included in the Register) to ensure that a person who imports or supplies an unapproved medical device in accordance with an approval under new subsection 41HD(1A) will not contravene these offences or civil penalty provision in doing so. Item 47 makes a consequential amendment to the civil penalty provision in section 41MLA of the Act for making misrepresentations about medical devices, with the effect that a person may contravene this section if they make a misrepresentation that a medical device is the subject of an approval under new subsection 41HD(1A) and that representation is false or misleading. 44

Item 48 makes a consequential amendment to provide that it is an offence for a person who breaches a condition of an approval granted under new subsection 41HD(1A) (maximum penalty 60 penalty units). Item 51 makes a consequential amendment to section 46A of the Act to allow authorised persons to, in accordance with that section, search the premises of a person granted an approval under new subsection 41HD(1A) to monitor compliance with the Act. Item 53 makes a consequential amendment to section 56A of the Act, to allow the Secretary to certify that, at a specified time or times, there was no approval under new subsection 41HD(1A) in place in relation to a particular person and particular medical device. Alignment of cancellation powers Items 6, 7 and 8 Item 6 amends section 30 of the Act, to enable the Secretary to immediately cancel registered or listed therapeutic goods from the Register if:  the sponsor has not paid the annual charge for their goods within 28 days of the charge becoming payable; or  the Secretary is satisfied that the sponsor of the goods supplied information that was false or misleading in a material particular in, or in connection with, their application to register or list the goods in the Register. In relation to the non-payment of annual charges, currently the Secretary may cancel registered or listed goods on this basis under section 30, but may only do so after having first given the sponsor notice of a proposal to cancel, providing an opportunity to make submissions and considering any such submissions before taking action. In most cases, however, it will be clear whether a sponsor has paid their annual charge on time or not, and as such these steps would not appear to be best suited to this grounds of cancellation. Items 6 and 7, taken together, move this grounds of cancellation to subsection 30(1) of the Act, to allow for immediate cancellation (item 8 makes a minor formatting change to reflect this change). This aligns the cancellation powers for registered and listed goods with those already in place for biologicals and medical devices. In relation to the provision of false or misleading information supplied as part of or with an application for registration or listing in the Register, the Act does not currently include this ground of cancellation for these products. This amendment would therefore align the cancellation powers for registered and listed goods with those already in place in the Act for biologicals and medical devices. 45

Revoking the cancellation of goods cancelled for non-payment of annual charges Item 9, 29 and 36 This item would amend the Act to allow sponsors of registered or listed therapeutic goods that the Secretary has cancelled for non-payment of annual charges to apply to the Secretary for a revocation of that cancellation. Provided the sponsor makes the request within 90 days of the cancellation, pays the prescribed application fee and has paid the outstanding annual charge for their goods, the Secretary may revoke the cancellation. Where the Secretary does so, the effect of such action is that the goods are taken to have never been cancelled. Items 29 and 36, respectively, make equivalent amendments in relation to biologicals and medical devices. These amendments are intended to provide a quicker, more reliable option to the current situation in which some sponsors who do not pay their annual charge on time to seek internal review by the Minister of the Secretary's decision to cancel, an option that involves a 60 day period for the Minister to make the decision on review, and where the sponsor would be required to provide reasons. Information-gathering power in relation to holders of manufacturing licences Items 34 and 52 While the Act allows the Secretary to require applicants for manufacturing licences (these are licences issued under Part 3-3 of the Act to manufacture therapeutic goods other than medical devices) to provide information or documents during the process of applying for a licence, the Act does not contain any general information-gathering capacity for the Secretary in relation to licence holders for post-market monitoring purposes. Item 34 therefore amends the Act to enable the Secretary to, by written notice, require licence holders to provide information or documents about a range of specified matters including, for example, about the goods they are manufacturing, the batch numbers and expiry dates of such goods, the distribution of the goods and the goods' conformity to applicable standards (new section 41AB). Under new subsections 41AB(2) and (3), such information or documents must be provided within the period specified in the notice, which must not be less than 14 days after the date of the notice, unless the Secretary is satisfied that, because of circumstances of urgency, a shorter period is warranted. This item also introduces related criminal offences for not complying with such a requirement (new section 41AC) (maximum penalty 400 penalty units), providing information or documents that are false or misleading in response to such a requirement (new sections 41AD and 41AE - maximum penalty in relation to each, imprisonment for 12 months or 1,000 penalty units, or both) and a corresponding civil penalty provision in relation to the provision of false or misleading information or documents (new section 41AF). 46

The proposed offences relating to the provisions of false or misleading information or documents in response to a request by the Secretary under new section 41AB would place an evidential burden on the manufacturer to point to some evidence that the information or documents was not false or misleading, if relying on the exceptions to those offences in proposed new subsections 41AD(2) or (3), and 41AE(2) or (3)). These offences are consistent with the Attorney-General's Department's Guide to Framing Commonwealth Offences, Infringement Notices and Enforcement Powers, as they only impose an evidential burden, not a legal burden, on defendant manufacturers. The Guide notes that an evidential burden is easier for a defendant to discharge, and does not completely displace the prosecutor's burden (only defers that burden). The offences are also consistent with existing offences in the Act for providing false or misleading information or documents about goods that are exempt from registration or listing (subsections 31D(2) and 31E(2) of the Act refer), and with existing offences in the Act that provide a defence of reasonable excuse for a defendant (subsections 31(4A), 32JB(1A) and 41JB(3A) of the Act refer). Also added to the Act is an accompanying self-incrimination provision, under which a person is not excluded from providing information or documents under new section 41AB on the grounds that such information or documents may tend to incriminate them, but (in the case of an individual) any such information or documents would not be admissible in evidence in criminal proceedings or civil penalty proceedings against the individual except in relation to proceedings under the new offences for providing false or misleading information or documents. This information will be important to support the effective regulation of the manufacturing of therapeutic goods under licence in Australia and safeguard public health, particularly as it relates to significant matters such as the quality assurance and quality control measures used by a manufacturer, and whether a manufacturer has been observing good manufacturing principles (minimum requirements relating to quality and safety). The information may well also be largely uniquely known to the manufacturer, and if the TGA were not to be able to require its provision in light of the privilege, it could be quite difficult for the information to be identified through other means - principally through more frequent audits of manufacturers' premises (this would also be more costly for manufacturers, as fees apply in respect of such audits). Further, if the Secretary were to rely on information that is false or misleading to not suspend or revoke a manufacturing licence, that could potentially have quite serious consequences for public health and safety. Abrogating the privilege in the manner proposed in section 41AG would also appear consistent with the Guide to Framing Commonwealth Offences, Infringement Notices and Enforcement Powers, in that it applies in respect of persons alleged to have given false or misleading information (or documents), and is constrained by a use and derivative use immunity in that the information or documents will not be admissible in evidence against the person in most proceedings. 47

The approach in section 41AG is also consistent with existing provisions in the Act that affect the privilege in relation to the provision of false or misleading information about goods that are exempt from registration or listing in the Register (section 31E) or about biologicals that are included in the Register or proposed to be so included (section 32JD) or in relation to medical devices (sections 41JC and 41JJ of the Act refer). Item 52 makes a minor, consequential amendment to the table of offences in section 54BA of the Act to add a reference to each of new sections 41AD and 41AE (provision of false or misleading information or documents to the Secretary by a manufacturing licence holder) to that table, with the effect that an executive officer of a body corporate may commit an offence if the body corporate commits one of these offences and the officer knew beforehand that the offence would be committed and was in a position to influence the conduct of the body corporate in relation to the commission of the offence and failed to take all reasonable steps to prevent the offence being committed. Conditions of the inclusion in the Register for medical devices - powers to prescribe and make a legislative instrument Item 35 This item allows regulations to be made to set out conditions that would apply in respect of the inclusion of kinds of medical devices in the Register, and also allows the Minister to make a legislative instrument setting out such conditions of inclusion. In so doing, this item has the effect of bringing conditions for medical devices under the Act into line with the situation for registered or listed goods. Minor measures Items 1 and 49 Item 1 makes a minor amendment to remove the definition of the National Manager of the Therapeutic Goods Administration from subsection 3(1) of the Act, as this position no longer exists, and item 65 removes two references to this position from section 42T of the Act. Items 10, 24 These items make minor amendments to allow for the publication of certain information by the Secretary either in the Gazette or on the Department's website, for consistency with other provisions in the Act that relate to or incorporate publication elements. Item 55 This item replaces each of subsections 57(8) and (9) of the Act (which deal with the delegation of certain powers under the Act) with new such subsections with the same numbering. The principal effect of these changes is to remove a reference currently in each of paragraphs 57(8)(a) and (9)(a) of the Act to the National Manager of the Therapeutic 48

Goods Administration (as this position no longer exists and the function is carried out by a Deputy Secretary of the Department of Health), and to replace a reference in each of paragraphs 57(8)(b) and (9)(b) to the Therapeutic Goods Administration, with a reference to the Department, to more accurately reflect restructures in recent years. Consistent with the Department's overall approach to delegations under the Act and regulations, administrative processes are in place to ensure that the Secretary's powers and functions under the amendments proposed by the Bill will be delegated to officers at an appropriate level of seniority, and to ensure that staff exercise delegations appropriately. The delegation of the Secretary's current power to approve the importation and supply of unapproved medicines, biologicals and medical devices for which substitutes are unavailable or in short supply is limited under regulations made for the purposes of current paragraphs 57(8)(b) and 57(9)(b) of the Act to three positions at the First Assistant Secretary level of the Department's Health Products Regulation Group. Any regulations made for the purposes of the proposed new subsections 57(8) and (9) of the Bill would maintain this approach. Transitional provisions Item 58 This item provides for a small number of transitional arrangements - these are that:  if a legislative instrument made by the Secretary under subsection 19A(3) of the Act to specify foreign countries from which unapproved goods may be obtained in the event of a shortage under subsection 19A(1) is in force immediately before the commencement of this item, the determination has effect after that time as if a reference in the determination to a prerequisite for approval by the Secretary under section 19A were a reference to a prerequisite for approval by the Secretary under subsection 19A(1) of that Act;  if regulations made for the purposes of current paragraphs 57(8)(b) or 57(9)(b) of the Act are in force immediately before the commencement of this item, such regulations have effect after that time as if they had been made for the purposes of subsections 57(8) and (9) of the Act as amended by this Act. 49

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