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2016-2017-2018
THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA
HOUSE OF REPRESENTATIVES
THERAPEUTIC GOODS AMENDMENT (2018 MEASURES No. 1) BILL 2018
EXPLANATORY MEMORANDUM
(Circulated by authority of the Minister for Health, the Hon Greg Hunt MP)
THERAPEUTIC GOODS AMENDMENT (2018 MEASURES NO. 1) BILL 2018
OUTLINE
The Therapeutic Goods Amendment (2018 Measures No. 1) Bill 2018 (the Bill)
makes a number of amendments to the Therapeutic Goods Act 1989 (the Act).
These amendments will:
a) introduce a mandatory reporting scheme for medicine shortages involving higher
risk medicines in Australia, and the introduction of penalties for non-compliance
with the scheme; and
b) make a number of miscellaneous amendments to the Act, principally aimed at
reducing inefficiencies in the regulation of therapeutic goods for industry and the
Therapeutic Goods Administration (the TGA) within the Department of Health,
for example by supporting the use of online forms, and providing greater clarity of
regulatory requirements.
Mandatory reporting of medicine shortages and permanent discontinuations
Medicine shortages have become an increasing problem in recent years for a number
of reasons, including a decrease in the local manufacture of prescription medicines,
and the increasingly globalised nature of supply chains. More often, different brands
of the same generic medicine (i.e. different brands of medicine with the same active
pharmaceutical ingredient) are being manufactured by the same facility. This can
mean that even in cases where several products containing the same active ingredient
are approved for marketing in Australia, they may all be made by the same
manufacturer and a manufacturing problem may simultaneously affect several
Australian sponsors.
A Medicine Shortages Information Initiative (MSII) and website was launched in
2014 by TGA. This is a voluntary notification scheme where sponsors are encouraged
to notify the TGA of medicine shortages, but reporting is not compulsory. Under this
scheme, however, a significant number of shortages of critical impact on patients have
not been reported, notwithstanding considerable encouragement from the TGA for
greater industry engagement. As such, the current voluntary arrangements do not
provide a sufficient incentive for sponsors to report when their product will be in
shortage, meaning that the information available on the TGA's website in relation to
shortages, notified under the MSII, is not a complete or current source of information
about medicine shortages.
In response to the issues experienced with the current voluntary scheme, a Medicine
Shortages Working Party comprised of the Medicines Partnership of Australia, the
Australian Medical Association and the Society of Hospital Pharmacists of Australia,
and chaired by the Department of Health, developed a revised protocol for the
management and communication of shortages. This involves mandatory confidential
reporting of all shortages to the TGA, the publication of those shortages that are of
particular impact on patients and the development of a more transparent and action-
oriented approach to the management of confirmed and serious medicine shortages.
1
This Bill would amend the Act to introduce mandatory reporting requirements for
sponsors of mainly prescription medicines to report shortages of, and any decisions to
permanently discontinue, their products to the Secretary of the Department of Health
(the Secretary).
The new scheme would principally apply to prescription medicines, including
medicines containing controlled drugs for which restrictions on supply and use are
recommended under the Poisons Standard in order to avoid misuse or dependence
(e.g. methadone, morphine).
Other medicines that are registered in the Australian Register of Therapeutic Goods
(the Register) may also be determined by the Minister for Health (the Minister) to be
subject to the new scheme, if satisfied that their inclusion would be in the interests of
public health (e.g. over the counter medicines such as EpiPens and Ventolin inhalers).
Each of these is a reportable medicine for which the sponsor would be required to
notify the Secretary, using the approved form, of any shortage or permanent
discontinuation of their product:
for a shortage of 'critical impact'- as soon as possible, but no later than 2 working
days after they know or ought to have reasonably known of the shortage;
for any other shortage - within 10 working days after they know or ought to have
reasonably known of the shortage;
for a discontinuation of 'critical impact' - at least 12 months before the
discontinuation would occur or, if this is not possible, as soon as practicable after
the sponsor's decision;
for any other discontinuation - at least 6 months before the discontinuation would
occur or, if this is not possible, as soon as practicable after the decision.
A medicine would be in 'shortage' if its supply in Australia will not, or will not likely,
meet the demand for it at any time in the next 6 months, for all the patients in
Australia who take it or who may need to take it. Instances of unavailability or short
supply that only occur at particular locations in Australia would not be considered
shortages under the Bill.
It is important to note that in relation to the reporting of shortages within the above
timeframes, the requirement to do so would only apply after the sponsor has
considered all the information that it needs to take account of for the purposes of
identifying if its medicine will, or will likely, be in shortage.
A shortage or a decision to permanently discontinue a reportable medicine would be
of 'critical impact' (meaning that the shorter notification timeframes outlined above
would apply) where either:
the reportable medicine is included in a legislative instrument made by the
Minister, to be known as the Medicines Watch List, signalling that the Minister is
satisfied that a shortage or permanent discontinuation of that product could cause
significant morbidity or death for patients in Australia; or
there are no other registered medicines that could reasonably be used as a
substitute for the medicine or, if there are, it is not likely that there would be
enough of such substitutes to meet the demand for the supply of them as a result of
the reportable medicine's shortage or discontinuation.
2
Some examples of when the requirement to notify the Secretary of a shortage or
permanent discontinuation would arise would be where:
Scenario Outcome
A sponsor of a reportable medicine that is As the anticipated shortfall of supply
included in the Medicines Watch List would fall within 6 months from 5
becomes aware on 1 February 2019 of February 2019, on that date there is a
possible manufacturing delays at the site shortage of the medicine. As the medicine
of its manufacturer. After investigating is included in the Medicines Watch List,
further and obtaining information from the shortage would be of critical impact,
the manufacturer, the sponsor concludes, and the sponsor must notify the Secretary
on 5 February 2019, that although the as soon as possible or within 2 working
stocks of the medicine in Australia will days - i.e. by 7 February 2019.
be sufficient to meet demand for the time
being, the manufacturing delays will
result by early April 2019 in the supply of
the medicine in Australia not meeting or
not likely meeting the overall demand for
it in Australia.
A sponsor of a reportable medicine As there are no reasonable substitutes for
becomes aware on 1 March 2019 that its the medicine and its discontinuation is
manufacturer intends to close its likely to have a serious impact on the
operations at the end of 2019. After physical or mental health of patients, the
urgently contacting other manufacturers, discontinuation of the medicine would be
the sponsor decides on 11 March 2019 to of critical impact. As the sponsor is
discontinue the medicine, with the unable to notify the Secretary of the
discontinuation likely to take effect from discontinuation at least 12 months before
1 January 2020. Although the medicine is the discontinuation would occur, the
not included in the Medicines Watch List, sponsor must notify the Secretary of the
it is the only medicine in the Register for decision to discontinue as soon as
its particular therapeutic use and there are practicable after making that decision on
no reasonable substitutes for it. This is 11 March 2019.
likely to have a very serious impact on
persons who need to take the medicine.
A civil penalty would apply where sponsors do not notify the Secretary of a shortage
or permanent discontinuation of a reportable medicine within the applicable
timeframes mentioned above, with a maximum civil penalty in either instance of 100
penalty units for an individual and 1,000 penalty units for a body corporate.
An exception to these civil penalties would apply where, for a medicine that is not in
the Medicines Watch List, a sponsor reasonably considered that their shortage or
permanent discontinuation was not of critical impact and reported it in accordance
with the non-critical requirements, but the shortage or discontinuation was later
identified to be of critical impact.
3
It is important to note that compliance measures for the new scheme would, in most
cases, be based on a graduated approach to give sponsors the opportunity to comply;
civil penalty proceedings are more likely to be pursued where there is a history of
repeated non-compliance. The TGA would also engage in an education programme
targeted at sponsors of likely reportable medicines including those on the Medicines
Watch List, to raise awareness of the new scheme and to help prevent non-
compliance.
The Bill also extends the Secretary's power to request information from a sponsor
about a reportable medicine to information about a shortage or permanent
discontinuation.
Miscellaneous amendments
The Bill also includes the following minor amendments, mainly to support measures
introduced in 2017 by the Therapeutic Goods Amendment (2016 Measures No. 1) Act
2017 (the 2017 Amendment Act) as part of the Government's Response to the Expert
Panel Review of Medicines and Medical Devices Regulation, which was undertaken
to identify unnecessary or ineffective regulation and propose opportunities to enhance
the regulatory framework:
Allowing standards to adopt other documents as in force from time to time
Standards for therapeutic goods set out important requirements relating to safety
and quality that both sponsors and manufacturers must comply with. To align with
key international benchmarks, it is sometimes necessary to adopt international or
Australian standards. Under the Legislation Act 2003, this can currently only be
done by reference to such documents as at a particular time, limiting the currency
of these standards. The Bill provides the capacity for therapeutic goods standards
to adopt such documents as in force from time to time, allowing them to be more
current and better aligned with international best practice. It is important to note
that any amendment to such standards would be carefully consulted on with
affected parties before being implemented.
Allowing the Secretary to request information from priority pathway applicants
The Therapeutic Goods Amendment (2016 Measures No.1) Act 2017 included
amendments to the Act to allow priority applicant pathways to be set out in
regulations, to facilitate quicker access by patients to new medicines and medical
devices that provide a significant advantage over existing treatments. The Bill
makes a minor amendment to clarify that regulations may also allow the Secretary
to require persons who apply under one of these new pathways to provide
supporting information about their application.
Streamlining health practitioner notifications under the Special Access Scheme
The Therapeutic Goods Amendment (2016 Measures No.1) Act 2017 included
amendments to the Act to allow health practitioners to supply a greater range of
unapproved therapeutic goods to their patients by notification to the Secretary,
without the need for pre-approval (mainly for products with a history of safe use).
Those measures, however, currently require the treating practitioner themselves to
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submit the notification, which may be a burden - particularly in a busy hospital
setting. The Bill would amend the Act to allow other health practitioners (including
for example hospital pharmacists) to submit the notification on the treating
practitioner's behalf.
Streamlining certain advertising requirements
Under the Act, a person may apply to the Secretary for approval to use a restricted
representation in an advertisement for therapeutic goods - these are claims about
serious diseases or conditions generally accepted to require a health practitioner's
diagnosis and treatment. The Bill would remove the current requirement for such
applications to be signed, and allow them to be submitted online.
The Bill would also allow the Therapeutic Goods Advertising Code to adopt other
instruments and documents as in force from time to time - similar to the approach
for standards outlined above. This would principally allow the Code to incorporate
by reference the Poisons Standard (which recommends levels of access controls for
medicines and chemicals), for example to identify medicines covered by Schedule
3 of the Poisons Standard, for which an advertisement must include certain
statements about requiring the advice of a pharmacist.
Variations to registered medicines through notification
The Therapeutic Goods Amendment (2016 Measures No.1) Act 2017 included
amendments to the Act to allow regulations to prescribe kinds of variations to an
entry in the Register that the Secretary must make in accordance with a sponsor's
request, without the need for pre-approval. A range of such variations is currently
prescribed for registered medicines - these are minor, low-risk variations that do
not impact on a product's safety, quality or efficacy.
Under the Act, however, some variations although minor in nature, would result in
the creation of a separate and distinct good, and would therefore not presently take
advantage of this innovation; a new application for marketing approval would be
required. An example of such a change is the addition or removal of an ingredient
that is a flavour or colour. The Bill would address this limitation by allowing such
variations to be made, without triggering this mechanism.
Minor technical amendment
The Bill would make a very minor technical amendment to section 41FN of the
Act (which sets out conditions applying to the inclusion of kinds of medical
devices in the Register), to include the word "will" in the chapeau of that
provision.
Financial Impact Statement
There are no financial implications for the Government's budget. Implementation of
measures will be funded through the TGA's current cost recovery mechanisms, under
which the costs of administering the Act are fully recovered from industry.
5
Statement of Compatibility with Human Rights
Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny)
Act 2011
THERAPEUTIC GOODS AMENDMENT (2018 MEASURES NO. 1) BILL 2018
The Therapeutic Goods Amendment (2018 Measures No.1) Bill 2018 (the 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
Mandatory reporting of medicine shortages and permanent discontinuations
The Bill would amend the Therapeutic Goods Act 1989 (Act), principally to introduce
a mandatory reporting scheme for shortages and permanent discontinuations of mostly
prescription medicines.
The introduction of a mandatory reporting scheme for medicine shortages is in
response to a number of recent shortages of critical patient impact which were not
reported by sponsors. The current voluntary reporting scheme (the Medicine
Shortages Information Initiative, which has been in place since 2014) encourages
sponsors to notify the Therapeutic Goods Administration (TGA) of shortages of their
products, however it has not been effective in managing medicine shortages due to a
lack of reporting and difficulties in subsequently confirming the details of shortages
with affected sponsors. As such, the current voluntary arrangements do not provide a
sufficient incentive for sponsors to report when their products will be in shortage.
The Bill, therefore, would make the timely reporting of all medicine shortages in
Australia mandatory, in order to enable public communication to those impacted,
alternative supplies to be accessed and timely discussion by the TGA with the affected
sponsor and, separately, other potential suppliers, regarding suitable therapeutic
alternatives. A medicine would be in 'shortage' if its supply in Australia will not, or
will not likely, meet the demand for it at any time in the next 6 months, for all the
patients in Australia who take it or who may need to take it. Instances of
unavailability or short supply that only occur at particular locations would not be
shortages under the Bill.
The new measures would require sponsors of 'reportable medicines' (principally these
would be prescription medicines, and other medicines that are registered in the
Australian Register of Therapeutic Goods for which the Minister determines, in a
legislative instrument, that they should be covered by the scheme in the interests of
public health), to report a shortage of, or a decision to permanently discontinue the
supply of, their medicine to the Secretary within specified timeframes. These would
be either within 2 or 10 working days of when the sponsor knew, or ought to have
known, of the shortage, and at least 12 or 6 months before a permanent
discontinuation is to take effect (or, as soon as practicable after the decision to
discontinue), depending on the circumstances.
6
The shorter of these timeframes would apply for a shortage or discontinuation that is
of 'critical impact', as defined in the Bill. Principally, this would be where the
medicine is included in a legislative instrument made by the Minister, to be known as
the Medicines Watch List (on the basis that the Minister is satisfied that any shortage
or permanent discontinuation of the medicine could potentially result in significant
morbidity or death in relation to patients in Australia), or where there are no other
registered medicines that could reasonably act as a substitute for the medicine or, if
there are, it is not likely that there would be enough of such substitutes to meet the
demand for those products that would likely occur as a result of the shortage or
discontinuation.
A civil penalty would apply where sponsors do not notify the Secretary of a shortage
or a decision to permanently discontinue the supply of a reportable medicine, the
maximum civil penalty in either instance being 100 penalty units for an individual and
1,000 penalty units for a body corporate. The Bill also extends the Secretary's power
to request information from a sponsor about a medicine to information about a
shortage or permanent discontinuation.
Miscellaneous amendments
In addition, the Bill would also make a number of miscellaneous amendments to the
Act principally to eliminate inefficiencies in the regulation of therapeutic goods.
These include:
allowing standards for therapeutic goods, and the Therapeutic Goods Advertising
Code to refer to other instruments and documents as in force from time to time, to
enable them to better align with international benchmarks;
enabling regulations to empower the Secretary to require a person applying to use a
priority applicant pathway designed to support quicker access to new therapeutic
goods to provide information or documents about their application;
permitting a health practitioner, such as for example a hospital pharmacist, to
notify the Secretary about the supply of certain unapproved therapeutic goods, on
the treating practitioner's behalf rather than the treating practitioner themselves;
streamlining certain advertising requirements, and supporting the use of electronic
forms, by allowing persons who apply to the Secretary for approval for the use of a
restricted representation in a therapeutic goods advertisement (these are claims
about serious diseases or conditions) to do so without the need to sign the
application, and to do so electronically;
enabling sponsors to make certain, minor changes to their goods by notification to
the Secretary, without the need for pre-approval, and without triggering the need
for a new application for registration in the Register (an example of such a change
is the addition or removal of an ingredient that is a flavour or colour); and
a minor technical amendment to section 41FN of the Act (which sets out
conditions applying to the inclusion of kinds of medical devices in the Register), to
add the word "will" to the chapeau of that provision.
Human rights implications
Article 14 of the International Covenant on Civil and Political Rights (the ICCPR)
guarantees equality before courts and tribunals, and, in the determination of criminal
charges, or any suit at law, the right to a fair and public hearing before a competent,
7
independent and impartial court or tribunal established by law. Those charged with a
criminal offence have the rights set out in Article 14 of the ICCPR, including the
presumption of innocence and the guarantees set out in Article 14(2).
Under certain circumstances, a civil penalty can be characterised as 'criminal' for the
purposes of the application of Article 14.
This would not appear, however, to be the case for the civil penalties introduced by
the Bill for sponsors who do not report a shortage of, or a decision to permanently
discontinue, a reportable medicine within the required timeframe (new subsections
30EF(6) and 3OEG(6) refer).
In particular, these civil penalties are clearly identified as being civil measures rather
than criminal, and would be distinct in that regard from the range of clearly identified
criminal offence provisions elsewhere in the Act. In addition, they do not apply to the
public in general, but only to medicines sponsors, and do not carry any element of
imprisonment for non-payment.
The maximum level of the civil penalties involved - 100 penalty units for an
individual and 1,000 penalty units for a body corporate - are also not as high as the
maximum levels for many civil penalty provisions in the Act, which often have
maximums of 5,000 penalty units for an individual and 50,000 for a body corporate.
The civil penalty provisions in the Bill are principally intended to provide an effective
deterrent to non-compliance by corporations (who would comprise the bulk of
affected sponsors), and to also reflect the serious potential impact on public health of
non-reporting of medicine shortages and discontinuations. As the proposed
introduction of a new scheme for the mandatory reporting of medicine shortages and
discontinuations has been consulted on in detail with industry sponsors, and as the
TGA will continue with educational activities to raise awareness of the new
arrangements, it is expected that sponsors would be well aware of their obligations
under the new scheme.
As such, the civil penalties in the Bill would not appear to amount to criminal
sanctions for the purposes of international human rights law, and the Bill does not
contain any measures that would engage any other aspect of article 14.
In addition, by introducing measures designed to ensure that patients in Australia, and
their health practitioners, are able to be better informed about medicine shortages and
permanent discontinuations, and to better enable health practitioners to work with
their patients on options to minimize the effects of such events, the Bill would also
appear to support and promote the right to health in article 12(1) of the International
Covenant on Economic, Social and Cultural Rights.
Conclusion
As such, the Bill is compatible with human rights because it promotes the right to
health and does not raise any human rights issues.
The Hon Greg Hunt MP, the Minister for Health
8
THERAPEUTIC GOODS AMENDMENT (2018 MEASURES No. 1) BILL 2018
NOTES ON CLAUSES
Clause 1 - Short Title
This clause provides that the Bill, once enacted, may be cited as the Therapeutic
Goods Amendment (2018 Measures No. 1) Act 2018.
Clause 2 - Commencement
This clause provides the timetable for the commencement of various provisions
contained in the Bill:
sections 1 to 3 commence on the day that the Bill receives Royal Assent;
Schedule 1 commences the later of 1 January 2019 and the 28th day after this
Act receives the Royal Assent (this will allow time for the making of two
legislative instruments provided for in Schedule 1);
Part 1 of Schedule 2 commences the day after the Bill receives Royal Assent;
and
Part 2 of Schedule 2 commences on the 28th day after the day the Bill receives
Royal Assent (this will allow time for the making of a new form as mentioned
in Part 2 of Schedule 2).
Clause 3 - Schedule(s)
This clause provides that each Act that is specified in a Schedule to this Bill is
amended or repealed as set out in the applicable items in the Schedule concerned, and
any other item has effect according to its terms. Schedules 1 and 2 amend the
Therapeutic Goods Act 1989.
9
SCHEDULE 1 -- AMENDMENT OF THE THERAPEUTIC GOODS ACT 1989
Reporting medicine shortages and discontinuation of supply of medicine
Item 1 - Subsection 3(1)
This item amends subsection 3(1) of the Act to introduce the following key
definitions:
reportable medicine, which has the meaning given by new section 30EH (see
item 2 below); and
shortage of a medicine in Australia, which has the meaning given by new
section 30EI (see item 2 below).
Item 2 - After Division 2A of Part 3-2
This item adds new Division 2B to Part 3-2 of the Act. This Division sets out
requirements in relation to the reporting of medicine shortages and decisions by
sponsors to permanently discontinue the supply of a reportable medicine. Only
medicines included in the Australian Register of Therapeutic Goods (the Register) are
subject to the new reporting requirements. Unapproved medicines that may be
accessed via one of the unapproved goods schemes (e.g. the Special Access Scheme)
are not covered by the new requirements.
The reporting obligations introduced by this Division are in addition to, and do not
affect, other reporting obligations that are separately contained in the Act, for
example, the requirement to notify the Secretary of adverse events and other matters
in relation to registered therapeutic goods under sections 29A and 29AA of the Act.
Section 30EF Reporting medicine shortages
New section 30EF specifies the requirements that apply to a person in relation to
whom a reportable medicine is included in the Register (referred to below as 'a
sponsor') in relation to notifying the Secretary of a medicine shortage.
Reporting requirement
Under new subsection 30EF(1), where a shortage is of 'critical impact', the shortage
must be notified to the Secretary as soon as possible, but no more than 2 working days
after the first day the person knows, or ought reasonably to have known, of the
shortage. Other shortages must be notified within 10 working days of the first day
when the person knows, or ought reasonably to have known, of the shortage. A
'reportable medicine' is defined in new section 30EH, and new section 30EI defines
when a shortage occurs for the purposes of these new requirements.
Critical impact
New subsections 30EF(2) and (3) set out the circumstances in which a medicine
shortage will be of 'critical impact'.
Under subsection 30EF(2), a shortage will have a critical impact if, at the time of the
shortage, the medicine is specified in the 'Medicines Watch List', a legislative
instrument made by the Minister under new section 30EJ (see below).
In addition, subsection 30EF(3) provides that a medicine shortage will also be of
critical impact if:
10
the shortage has the potential to have:
at that time, there are no registered goods in the Register that could reasonably be
used as a substitute for the medicine or, if there are, they would not be likely to be
available in sufficient quantities to meet the demand for that would be likely to
arise as a result of the shortage; and
the shortage has the potential to have a life-threatening impact on, or a serious
impact on the physical or mental health or functioning of persons who take, or who
may need to take, the medicine.
The term 'registered goods' is defined in section 3 of the Act as therapeutic goods
included in:
the part of the Register for goods known as registered goods or
the part of the Register for goods known as provisionally registered goods.
Examples of a shortage of critical impact would include:
an unexpected shortage of heparin-based products - this product has no therapeutic
alternative and the post-surgical population group would potentially experience
life-threatening impacts if this medicine was not available;
a new oncology drug becomes unavailable, which may lead to changes in treatment
protocols or the rationing of stock for patients who have already commenced
taking the medicine.
Notification requirements
New subsection 30EF(4) requires that a notification of a shortage be made using the
form approved in writing by the Secretary, and contain the information required by
that form (noting the effect of section 25C of the Acts Interpretation Act 1901 in
relation to substantial compliance with approved forms).
New subsection 30EF(5) allows an approval of a form to require or permit
information to be given in accordance with specified software requirements, on a
specified kind of data processing device or by way of a specified kind of electronic
transmission.
Enforcement
New subsection 30EF(6) adds a new civil penalty provision which applies where a
person contravenes the reporting requirements in subsection 30EF(1). Contravention
of this provision will attract a maximum penalty of 100 penalty units for an
individual, and 1,000 penalty units for a body corporate. A penalty unit is currently
$210.
Compliance measures in relation to these new reporting obligations will be in
accordance with the TGA's Regulatory Compliance Framework. The TGA takes a
graduated, risk-management approach to compliance that attempts to identify persons
at risk of unintentional or deliberate non-compliance and enable the development of
appropriate strategies to prevent non-compliance. A graduated approach in this
regard, including activities to raise awareness and understanding of the new scheme,
will allow the TGA to respond appropriately to the full range of non-compliant
behaviours.
11
Regulatory measures available to the TGA for breach of these reporting obligations
will range from the publishing of the names of sponsors who do not comply with the
new requirements (in accordance with section 61 of the Act), to the issuing of
infringement notices and, in the most serious cases or where there is repeated non-
compliance, the initiation of civil penalty proceedings.
These maximum levels of the civil penalties introduced by the Bill have been subject
to public consultation. While the level of these penalties is substantially lower than
the maximum penalty levels for other conduct prohibited by the Act (for example,
non-reporting that a medicine has caused adverse effects for patients under section
29AA carries maximums of 3,000 penalty units for an individual, and 30,000 for a
body corporate), it is principally designed to provide an effective incentive for the
major pharmaceutical companies that comprise the market for prescription medicines.
Section 42YCA of the Act provides for daily penalties for continuing contraventions
of civil penalty provisions and will apply to subsection 30EF(6). This will have the
effect that the obligation of the sponsor to report a medicine shortage will continue
until a report has been made, and is not discharged upon expiration of the deadline. A
separate contravention of the civil penalty provision will be incurred for every day the
obligation is not met.
Section 42YK empowers the Secretary to issue an infringement notice where the
Secretary has reasonable grounds to believe a person has contravened a provision of
the Act or the regulations that is an offence of strict liability or a civil penalty
provision. Where an infringement notice is issued by the Secretary for breach of the
reporting obligation in subsection 30EF(1), a sponsor would be able to choose to pay
an infringement notice amount as an alternative to having court proceedings brought
against them for the contravention.
Subsection 42YKA(2) limits the amount payable under an infringement notice that
relates to a single alleged contravention to the lesser of:
one-fifth of the penalty that a court could impose on the person for that
contravention; and
12 penalty units where the person is an individual, or 60 penalty units where the
person is a body corporate.
Section 42YKA(3) provides an equivalent limit on the amount payable under an
infringement notice that relates to multiple contraventions.
Exception to civil penalty
New subsection 30EF(7) provides for an exception to the civil penalty contravention
in relation to the reporting of a shortage of critical impact. This exception applies
where, as a result of steps taken by the sponsor, it was reasonable to assume that the
shortage was not of a critical impact, and the sponsor reported the shortage in
accordance with paragraph (1)(b).
This exception is limited to the requirement to report a medicine shortage that is
determined to be of critical impact under subsection 30EJ(3), which may involve
some judgement on the part of the sponsor. It will not apply where the shortage relates
to a medicine that is specified in the Medicines Watch List (see subsection 30EF(2)
and section 30EJ), as this is a more objective standard, that a sponsor would be able to
12
identify by checking that instrument (a link to which will be available on the TGA's
website, www.tga.gov.au).
Section 30EG Reporting discontinuation of supply of medicine
New section 30EG specifies the requirements that apply to a sponsor in relation to
notifying the Secretary of discontinuations of the supply of reportable medicines.
Reporting obligations and timeframes
New subsection 30EG(1) requires a sponsor to notify the Secretary of any decision of
the person to permanently discontinue the supply of a reportable medicine in Australia
('the discontinuation decision').
Where the discontinuation is likely to be of 'critical impact', the sponsor must report
the discontinuation at least 12 months before the discontinuation is proposed to occur.
If the sponsor is unable to comply with this timeframe, then it must be reported as
soon as practicable after the decision to discontinue is made.
Where the discontinuation is not likely to be of 'critical impact', the sponsor must
report the discontinuation at least 6 months before the discontinuation is proposed to
occur. If the sponsor is unable to comply with this timeframe, it must be reported as
soon as practicable after the decision is made.
The long lead time for reporting a permanent discontinuation which is of critical
impact is needed because in many cases the sponsor may be the sole supplier of the
medicine in Australia. The long lead time is designed to enable the TGA to identify an
alternative supplier of the product for the Australian market, which may include
seeking or reviewing an application for registration of the alternative medicine on the
Register.
Critical impact
New subsections 30EG(2) and (3) set out the circumstances in which a
discontinuation is likely to be of critical impact. The circumstances mirror those set
out in subsections 30EF(2) and (3) in relation to medicine shortages. That is, a
discontinuation will be of critical impact if:
at the time the discontinuation decision is made, the medicine is specified in the
Medicines Watch List made by the Minister under section 30EJ; or
the discontinuation has the potential to have a life-threatening impact on, or a
serious impact on the physical or mental health or functioning of, persons who
take, or may need to take, the medicine and one of the following also applies at the
time of the discontinuation decision:
o there are no registered goods that could reasonably be used as a
substitute; or
o there are other registered goods that could reasonably be used as a
substitute, but these are not likely to be available in sufficient
quantities to meet demand.
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Notification requirements
New subsection 30EG(4) requires that a notification of a discontinuation decision be
made using the particular form approved in writing by the Secretary, and must contain
the information required by that form.
New subsection 30EG(5) allows an approval of a form to require or permit
information to be given in accordance with specified software requirements, on a
specified kind of data processing device or by way of a specified kind of electronic
transmission.
Enforcement
New subsection 30EG(6) inserts a civil penalty provision for contravention of the
requirement to report a discontinuation decision under subsection 30EG(1), and
mirrors new subsection 30EF(6). Contravention of this provision attracts a maximum
penalty of 100 penalty units for an individual, and 1,000 penalty units for a body
corporate. As noted above, a penalty unit is currently $210.
As discussed above in relation to new subsection 30EF(6):
section 42YCA of the Act provides for daily penalties for continuing
contraventions of civil penalty provisions and will apply to subsection 30EG(6);
the Secretary would have power to issue an infringement notice under section
42YK of the Act, which would enable a sponsor to choose to pay an infringement
notice amount as an alternative to having court proceedings brought against them
for the contravention;
subsection 42YKA(2) limits the amount payable under an infringement notice.
Exception to civil penalty
New subsection 30EG(7) provides for an exception to the civil penalty contravention
which is in the same terms as new subsection 30EF(7). The exception applies where,
as a result of steps taken by the person, it was reasonable for that person to assume
that the discontinuation was not of a critical impact, and that person reported the
discontinuation in accordance with paragraph (1)(b). However, this exception is
limited to the requirement to report a discontinuation decision that is determined to be
of critical impact under subsection 30EG(3), and will not apply where it relates to a
medicine that is specified in the Medicines Watch List (see subsection 30EG(2) and
section 30EJ), for the same reasons as noted above in relation to new subsection
30EF(7).
Section 30EH What is a reportable medicine?
New section 30EH provides that a 'reportable medicine' is:
a medicine that contains one or more substances included in Schedule 4 or 8
to the current Poisons Standard (these are, respectively, prescription
medicines, and prescription medicines containing controlled drugs for which
restrictions on their supply and use are recommended under the Poisons
Standard in order to avoid misuse or dependence (e.g. methadone,
morphine)); and
other medicines determined under a legislative instrument by the Minister,
provided that the Minister is satisfied the medicine is critical to the health of
patients in Australia or that the reporting of any shortage, or permanent
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discontinuation of supply, of the medicine would be in the interests of public
health (examples may include EpiPens, and Ventolin inhalers).
A 'medicine' is defined in section 3 of the Act as meaning:
therapeutic goods (other than biologicals) that are represented to achieve, or are
likely to achieve, their principal intended action by pharmacological, chemical,
immunological or metabolic means in or on the body of a human; and
any other therapeutic goods declared by the Secretary, for the purpose of the
definition of therapeutic device, not to be therapeutic devices.
Section 30EI When is there a medicine shortage?
New section 30EI has the effect that there is a shortage of a medicine in Australia at a
particular time if the supply of that medicine in Australia will not, or will not be likely
to, meet the demand for the medicine at any time in the next 6 months for all of the
patients in Australia who take, or who may need to take, the medicine.
A shortage is determined at a national level, and instances of unavailability or short
supply that only occur at a particular location would not be a shortage for the purposes
of the Bill. Accordingly, shortages that are limited to a particular geographic location,
a particular pharmacy or a particular wholesaler will not fall within this definition.
It is important to note that this definition includes both shortages that have
commenced, as well as those that are anticipated to commence at a date within the
next 6 months.
Section 30EJ Medicines Watch List
The reporting obligations of sponsors under subsections 30EF(1) and 30EG(1) depend
on whether or not the shortage or discontinuation is of critical impact. Under
subsections 30EF(2) and 30EG(2), a shortage or discontinuation will be of critical
impact if, at the time of the shortage or the discontinuation decision, the relevant
medicine is included in an instrument made under section 30EJ.
New section 30EJ empowers the Minister to make a legislative instrument for the
purposes of subsections 30EF(2) and 30EG(2), which will be known as the Medicines
Watch List. The Minister may only determine a medicine for the purposes of this
instrument if satisfied that any shortage of, or permanent discontinuation of the supply
of, the medicine in Australia has the potential to result in:
significant morbidity in relation to patients in Australia or
the death of one or more patients in Australia.
Such medicines may include, for example, brown snake antivenom, and adrenaline.
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The making of the Medicines Watch List as a legislative instrument is designed to
provide certainty for sponsors and the public in relation to the reporting obligations
for shortages and discontinuations of medicines included on the list, while also
providing the appropriate level of flexibility to ensure that the instrument continues to
reflect medicines for which a shortage or permanent discontinuation is appropriately
deemed to be critical. The list may be amended or revoked by the Minister in the same
way as it is made (see subsection 33(3) of the Acts Interpretation Act 1901).
As a legislative instrument, the Medicines Watch List will be subject to the
requirements of the Legislation Act 2003, including requirements in relation to
consultation and parliamentary scrutiny. The TGA will undertake appropriate
consultation with stakeholders before adding medicines to, or removing medicines
from, the Medicines Watch List. The Medicines Watch List will be publicly available
on the Federal Register of Legislation which can be accessed at
https://www.legislation.gov.au/.
Item 3 - After paragraph 31(1)(j)
Subsection 31(1) of the Act enables the Secretary to require a range of persons to
provide information or documents about specified matters relating to registered
therapeutic goods. This item adds new paragraph 31(1)(k) that applies where the
goods are a reportable medicine registered in relation to the person, and expands the
matters to include information or documents, relating to the following:
whether or not there is a shortage of the medicine in Australia;
if there is a shortage of the medicine in Australia - the shortage, or
any decision of the person to permanently discontinue the supply of the
medicine in Australia.
Item 4 - Application provision
This item provides for an application measure to ensure that the requirements set out
in sections 30EF and 30EG will apply in relation to medicines included in the
Register before, on or after commencement of this item.
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SCHEDULE 2 -- OTHER AMENDMENTS
Part 1 - Amendments commencing the day after Royal Assent
Item 1 - After subsection 9D(2C)
The Therapeutic Goods Amendment (2016 Measures No.1) Act 2017 included
amendments to the Act to allow regulations to prescribe kinds of variations to an entry
in the Register that the Secretary must make in accordance with a sponsor's request,
without the need for pre-approval. A range of such variations is currently prescribed
for registered medicines - these are minor, low-risk variations that do not impact on a
product's safety, quality or efficacy.
Under the Act, however, some variations although minor in nature, would result in the
creation of a separate and distinct good, and would therefore not presently take
advantage of this innovation; a new application for marketing approval would be
required (subsection 16(1) of the Act refers). An example of such a change is the
addition or removal of an ingredient that is a flavour or colour. This item would
address this limitation by allowing such variations to be made, without triggering this
mechanism.
Items 2, 11 and 12 - At the end of section 10, and Section 42BAA
Subsection 10(1) of the Act allows the Minister to, by legislative instrument, make
standards for therapeutic goods other than medical devices. Under subsection 10(2)
of the Act, standards may relate to such matters as the quality of the goods and their
quantity when packaged in particular kinds of containers, the procedures to be
followed in their manufacture and their labelling and packaging. As such, standards
play a vital role in ensuring the safety, quality and efficacy of therapeutic goods. It is
a ground of cancellation from the Register if a product does not comply with an
applicable standard, and the Act also contains offences and civil penalties for not
complying with an applicable standard. It is also a statutory condition of
manufacturing licences issued under Part 3-3 of the Act that licence holders must
ensure that the goods they manufacture comply with applicable standards.
In aligning the regulation of therapeutic goods with international best practice in
relation to product safety and quality, it is sometimes important for therapeutic goods
standards to require compliance with, or refer to matters by reference to, other
documents such as standards issued by the International Organization for Standards
(ISO), European Union documents or Australian Standards. Some examples include:
Therapeutic Goods Order 81 - 'Standards for Blood and Blood Components' -
which requires blood and blood components to comply with the document
published by the European Directorate for the Quality of Medicines and
Healthcare of the Council of Europe titled 'Guide to the preparation, use and
quality assurance of blood components', 14th edition, 2008;
TGO 95 - 'Child-Resistant Packaging Requirements for Medicines 2017' -
which requires the packaging for medicines that are supplied in a reclosable
package to comply with at least one of a number of specified international or
Australian documents including for example the International Organization for
Standards (ISO) Standard ISO 8317:2015 'Child resistant packaging -
Requirements and testing procedures for reclosable packages', as published by
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the International Organization for Standards on 5 November 2015, the Canadian
Standards Association Standard CSA Z76.1-16 'Reclosable Child-Resistant
Packages', as published by the Canadian Standards Association on 1 December
2016 and to certain parts of Title 16 of the United States Code of Federal
Regulations; and
TGO 94 - 'Standard for Haematopoietic Progenitor Cells derived from Cord
Blood' - which requires such cells to comply with the document titled
'NetCord-FACT International Standards for Cord Blood Collection, Banking
and Release for Administration', sixth edition, July 2016, published by NetCord
and the Foundation for the Accreditation of Cellular Therapy.
These documents are available online from the websites of the bodies responsible for
their publication, in some instances accessible for free (e.g. the United States Code of
Federal Regulations, as mentioned in TGO 95, and European Union regulations) and
in some instances an access fee applies (e.g. standards published by the ISO). In either
event, it is expected that sponsors and manufacturers, who would be the persons most
affected by the adoption of such documents, would be familiar with, and have access
to, them. It would not be feasible from a regulatory perspective to not adopt such
benchmarks because they are not always available for free.
The TGA also undertakes considerable consultation for major changes to therapeutic
goods standards, and an instrument such as an ISO standard would only be adopted as
in force from time to time after an appropriately careful and detailed consultation
process. In some instances sponsors may already be complying with more current
versions of such documents in other jurisdictions, and the proposed amendment would
allow for a reduction in duplication for those sponsors.
Under subsection 14(2) of the Legislation Act 2003, however, provision for a matter
may only be made in a legislative instrument by reference to such documents as at a
particular time, and not as in force from time to time, unless a contrary intention
appears in the Act under which the instrument is made - and there is no such contrary
intention in the Act in relation to orders made under subsection 10(1) at present.
This can mean that therapeutic goods standards often refer to out-dated documents
that no longer align with international best practice, or that these standards may
become out of synch with international best practice over time. This can result in a
lack of consistency with international benchmarks, requiring the amendment of
standards each time the international standard is updated. It can also hinder the ability
of therapeutic goods standards to adapt to new and emerging technologies.
Accordingly, item 2 amends section 10 of the Act to include a contrary intention for
the purposes of subsection 14(2) of the Legislation Act 2003 - i.e. to allow an order
made under subsection 10(1), or a variation of such an order, to apply, adopt or
incorporate, with or without modification, any matter contained in an instrument or
other writing as in force or existing from time to time. This will address the concerns
outlined above, and allow therapeutic goods standards to more closely align with
international benchmarks, and to be more responsive to new and emerging
technologies.
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Item 12 amends section 42BAA of the Act to make an equivalent amendment in
respect of the Therapeutic Goods Advertising Code (the Code), to also allow that
instrument to make provision for a matter by applying, adopting or incorporating,
with or without modification, any matter contained in an instrument or other writing
as in force or existing from time to time. This will address similar concerns for this
instrument, particularly in relation to referring to the Poisons Standard (made under
section 52D of the Act). Although a legislative instrument, the Poisons Standard is
not disallowable (subsection 52D(4A) of the Act refers), meaning that its adoption by
another legislative instrument would (in the absence of a contrary intention), be
subject to the limitation in subsection 14(2) of the Legislation Act 2003.
It is very important that the Code is able to refer to the most current version of the
Poisons Standard, principally for the purposes of identifying medicines that an
advertisement for which must contain words to the effect that a pharmacist's advice is
required in association with their use. These are certain medicines that are listed in
both Schedule 3 and Appendix H of the Poisons Standard, to signify that they are
recommended by the Poisons Standard to be 'pharmacist only medicine', i.e. available
to the public without a prescription, but which require a pharmacist's advice for safe
use, and that may be advertised to the public (e.g. Vitamin D).
Item 11 makes a minor, editorial amendment to section 42BAA of the Act, to
accommodate the change to that provision to be made by item 12.
Items 3, 5 and 10 - After subsection 19(7G), subsection 32CM(7G) and 41HC(6F)
The Therapeutic Goods Amendment (2016 Measures No.1) 2017 (the 2017
Amendment Act) amended the Act to, among other things, enable the Minister to
make a legislative instrument identifying unapproved medicines (i.e. medicines not
included in the Register) that specified kinds of health practitioners may supply to
their patients without the Secretary's prior approval. Equivalent changes were made in
respect of biologicals and medical devices (subsections 19(7A), 32CM(7A) and
42HC(6) of the Act refer). This pathway for accessing unapproved therapeutic goods
requires the treating health practitioner supplying the product to notify the Secretary
within 28 days of having done so, providing the information prescribed in the
regulations for that purpose (e.g. the medical condition for which the product was
supplied).
However, the requirement that the notification must always be provided by the
treating health practitioner is not consistent with the other main notification pathway
for accessing unapproved therapeutic goods - for Category A patients under the
relevant Special Access Scheme. Under the provisions that set out those
arrangements, the notification may also be provided to the Secretary by another health
practitioner, on the treating practitioner's behalf (paragraph 12A(2)(a)(iii) of the
Therapeutic Goods Regulations 1990, and paragraph 7.2(1A)(a) of the Therapeutic
Goods (Medical Devices) Regulations 2002 refer).
Allowing another health practitioner to also submit the notification on the treating
practitioner's behalf is designed to reduce the regulatory burden for practitioners,
particularly in busy hospital settings where hospital pharmacists may be better able to
undertake this role.
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These items therefore introduce new subsections 19(7GA), 32CM(7GA) and
41HC(6FA) to achieve the same outcome for the arrangements added by the 2017
Amendment Act. The new provisions do this by ensuring that the offence in
subsections 19(7F), 32CM(7F) and 41HC(6E) for not submitting the notification will
not apply to a treating practitioner if another health practitioner has submitted the
notification on the treating practitioner's behalf.
A note under each of the new provisions explains that, under section 13.3 of the
Criminal Code, the defendant (in this instance, the treating practitioner) would bear an
evidential burden to point to some evidence that suggests a reasonable possibility that
another health practitioner submitted the notification on their behalf.
As such arrangements between health practitioners, for example in a hospital setting,
would be expected to be well known by both sets of practitioners, it is considered to
be appropriate for the treating practitioner to bear an evidential burden in this respect.
It is also noted that this is an evidential burden only, and not a legal burden, consistent
with the Guide to Framing Commonwealth Offences, Infringement Notices and
Enforcement Powers, dated September 2011.
Items 4, 6, 7, 8 - At the end of each of subsections 25AAA(3), 32DEA(3),
41ECA(3) and 41FKA(3)
The 2017 Amendment Act also amended the Act to allow regulations to be made
establishing priority pathways for the expedited assessment of, principally, promising
new medicines, biologicals and medical devices. The Act was amended to allow
regulations to be made for and in relation to empowering the Secretary to make
priority applicant determinations, which then allow sponsors to apply to access the
relevant priority pathway for their product. The Act also allows regulations to
provide for how to apply for such a determination, the approval of a form for such an
application and the application fee for such an application.
However, the Act does not appear to clearly allow the making of regulations
authorising the Secretary to require an applicant for a priority applicant determination
to provide further information about their application, where this is required for the
Secretary to complete the assessment of the application. This is quite important,
particularly in the context of promising new products for which an expedited
evaluation is sought, as without such information the Secretary may not be able to
complete the assessment. As such, these amendments would make minor
amendments to each of sections 25AAA, 32DEA, 41ECA and 41FKA of the Act to
allow the making of regulations to specify such a power for the Secretary.
Item 9 - Subsection 41FN(1)
This item makes a minor amendment to correct a typographical error in the chapeau
of subsection 41FN(1) of the Act.
Item 13 - Application and transitional provisions
This item would set out the following application and transitional arrangements in
relation to the above amendments:
the amendment of section 19 of the Act by item 2 above applies in relation to
the supply of therapeutic goods on or after the commencement of this item (i.e.
the day after this Bill receives Royal Assent);
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the amendment of section 32CM of the Act by item 4 above applies in relation
to the supply of a biological on or after the commencement of this item (i.e. the
day after this Bill receives Royal Assent);
the amendment of section 41HC of the Act by item 8 above applies in relation
to the supply of a medical device on or after the commencement of this item
(i.e. the day after this Bill receives Royal Assent); and
an instrument in force under section 42BAA of the Act immediately before the
commencement of this item (i.e. the day after this Bill receives Royal Assent)
continues in force on and after that commencement as if it were an instrument in
force under subsection 42BAA(1) of the Act.
Part 2 - Amendments commencing 28th day after Royal Assent
Item 14 - Section 42DE Applications for approval of use of restricted
representation
Section 42DE of the Act allows a person to apply to the Secretary for approval to use
a 'restricted representation' in a therapeutic goods advertisement. A restricted
representation is defined in section 42DD of the Act as a representation that refers to a
form of a disease, condition, ailment or defect identified in part of the Code as a
serious form of a disease, condition, ailment or defect. Appendix 6 of the Code then
provides further references to serious forms of diseases, conditions ailments or defects
for this purpose - e.g. cardiovascular diseases.
Currently under section 42DE of the Act, an application to the Secretary for approval
to use a restricted representation must be signed by or on behalf of the applicant, and
no mention is included in section 42DE of electronic submission of such applications
(unlike other application provisions in the Act, e.g. section 23).
As it is not considered necessary for an applicant to sign such an application form,
and in order to allow for more efficient and user-friendly options for submitting such
applications, this item would replace the current section 42DE of the Act with a new
section 42DE that would omit the requirement for signature. The new section would
also allow an approval of a form for the purposes of such applications to require or
permit an application to be given in accordance with specified software requirements,
on a specified kind of data processing device or by way of a specified kind of
electronic transmission.
Item 15 - Application provision
This item would make it clear that the repeal and substitution of section 42DE of the
Act by item 14 above applies in relation to applications for the use of a restricted
representation in a therapeutic goods advertisement made on or after the
commencement of this item.
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