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THERAPEUTIC GOODS AMENDMENT REGULATIONS 2005 (NO. 1) (SLI NO 192 OF 2005)
EXPLANATORY STATEMENT
Select Legislative Instrument 2005 No. 192
Issued by the Authority of the Parliamentary Secretary to the Minister for
Health and Ageing
Therapeutic Goods Act 1989
Therapeutic Goods Amendment Regulations 2005 (No. 1)
The object of the Therapeutic Goods Act 1989 (the Act) is to establish and maintain a national system of controls for the quality, safety and efficacy and timely availability of therapeutic goods that are used in Australia or exported from Australia. The Therapeutic Goods Administration (the TGA) is responsible for administering the Act.
Subsection 63(1) of the Act provides that the Governor-General may make regulations, not inconsistent with the Act, prescribing matters required or permitted to be prescribed by the Act, or necessary or convenient to be prescribed for carrying out or giving effect to the Act. Paragraph 63(2)(h) of the Act provides that the regulations may prescribe fees in respect of matters under the Act or the regulations. Part 2 of Schedule 9 to the Therapeutic Goods Regulations 1990 (the Principal Regulations) sets out the table of fees payable under the Act.
Paragraph 63(3)(b) of the Act provides, in part, for the reduction of fees in cases identified in the regulations. Regulation 45 of the Principal Regulations provides that the Secretary of the Department of Health and Ageing may waive or reduce fees specified in Schedule 9, by specified amounts, or to specified amounts, under certain circumstances.
The purpose of the Regulations is to increase most fees payable under the Act by 1.6 per cent, introduce new fees, vary specified fees for certain purposes and correct a numbering anomaly in the Principal Regulations. These fees predominantly relate to the evaluation of new therapeutic goods and the inspection of manufacturing premises.
The Regulations:
· increase the fees prescribed in regulation 45 and the full fees prescribed in Part 2 of Schedule 9 by 1.6 per cent, except as otherwise provided in the Regulations;
· decrease all evaluation fees for most prescription medicines by up to 5 per cent;
· exclude manufacturers of haematopoietic progenitor cells, which are regenerative flood forming cells which can be obtained from peripheral blood, cord blood and bone marrow, from inspection fees payable for licences for the manufacture of human blood and blood components;
· introduce a separate fee for the inspection of premises for the production of haematopoietic progenitor cells;
· increase the threshold for the annual turnover of a business to $66,000 before reduction of annual charges may apply for maintaining a manufacturing licence by a business; and
· make technical amendments to regulations 3A and 6A to correct a numbering anomaly.
The fees prescribed in regulation 45 and Part 2 of Schedule 9 are increased annually, and the proposed increases would enable the TGA to continue to meet the Government’s requirement that the TGA operate on a full cost-recovery basis.
The increase in fees is usually calculated by adding together 50 per cent of the annual Wage Cost Index (WCI) for the preceding year ended December and 50 per cent of the Consumer Price Index (CPI) for the preceding year ended December which would work out to be a 3.1 per cent increase on this occasion. However, given the level of operating reserves of the TGA and the demands on industry in preparing for the new Trans Tasman Joint Agency, this increase in fees is limited to 1.6 per cent.
The level of fees was reviewed in consultation with industry associations, including Medicines Australia, the Generic Medicines Industry of Australia, the Australian
Self-Medication Industry, the Complementary Healthcare Council of Australia and the Medical Industry Association of Australia. Industry associations had previously agreed to the WCI/CPI formula being applied to fees and charges as the basis for a 3.1 per cent increase. Industry associations would not oppose limiting the overall increase to 1.6 per cent.
The Regulations reduce the evaluation fees for most prescription medicines by up to 5 per cent in line with a plan to restructure the fee schedule agreed with industry in July 2003. Regulations that increase the annual charges for the registration of prescription medicines by 19 per cent have also been made. The overall change in total cost recovery for prescription medicines will be around 1.6 per cent.
The Regulations also exclude manufacturers of haematopoietic progenitor cells from inspection fees payable for licences for the manufacture of human blood and blood components, and impose a separate fee for the inspection of premises for the production of haematopoietic progenitor cells. The changes are a result of amendments to the Therapeutic Goods (Charges) Regulations 1990 which overcome an unintended application of annual charges for blood sites to haematopoietic progenitor cells facilities such as those for cord blood.
The Regulations also increase the threshold for the annual turnover of a business before reduction of annual charges may apply for maintaining a manufacturing licence by a business by 1.6 per cent from $65,000 to $66,000. The change ensures that the threshold is increased consistently with the general increases in annual charges for holding a manufacturing licence.
The new fees have been rounded to ten dollar increments (for amounts up to ten thousand dollars) or one hundred dollar increments (for amounts of ten thousand dollars or more).
The Regulations also address an anomaly in the numbering of the Principal Regulations to clarify the intention of previous amendments to regulations 3A and 6A. The changes rectify the combined effect of the two previous amendments that gave rise to the anomaly and remove doubt over the ability of one of the amendment regulations to effectively amend regulation 6A of the Principal Regulations.
Details of the Regulations are set out in the Attachment.
The Act specifies no conditions that need to be met before the power to make the Regulations may be exercised.
The Regulations are a legislative instrument for the purposes of the Legislative Instruments Act 2003.
The Regulations commence on the day after they are registered on the Federal Register of Legislative Instruments.
ATTACHMENT
Details of the Therapeutic Goods Amendment Regulations 2005 (No. 1)
Regulation 1 – Name of Regulations
This regulation provides that the title of the Regulations is the Therapeutic Goods Amendment Regulations 2005 (No. 1)
Regulation 2 – Commencement
This regulation provides for the Regulations to commence on the day after they are registered on the Federal Register of Legislative Instruments.
Regulation 3 – Amendment of the Therapeutic Goods Regulations 1990
This regulation provides that the Therapeutic Goods Regulations 1990 (the Principal Regulations) are amended as set out in the Schedule.
Items [1], [2] and [3] – Regulation 3A and regulation 6A
These items address an anomaly in the numbering of the Principal Regulations to clarify the intention of previous amendments to regulations 3A and 6A. The changes rectify the combined effect of the two previous amendments that gave rise to the anomaly and remove doubt over the ability of one of the amendment regulations to effectively amend
regulation 6A of the Regulations (which deals with unacceptable presentations) as intended.
The Therapeutic Good Amendment Regulations 2003 (No. 4) (the earlier amendment regulations) amended regulation 6A of the Principal Regulations on 9 October 2003. The amendment to regulation 6A was not required to commence until 1 October 2004, to allow for a transition period for sponsors to implement measures (relabelling of goods) to satisfy the new requirement.
Regulation 6A of the Principal Regulations was again amended by the Therapeutic Goods Amendment Regulations 2003 (No.5) (the later amendment regulations) on 4 December 2003. The later amendment regulations commenced on 5 December 2003 and provided for the renumbering of regulation 6A as regulation 3A and inserted a new regulation 6A for the purposes of paragraph 42DF(4)(c) of the Act (dealing with approval of use of restricted representations).
As a result, there is doubt whether the amendments proposed by the earlier amendment regulations are able to have their intended effect.
Item [1] renumbers the current regulation 3A as subregulation 3A(1).
Item [2] inserts new subregulation 3A(2). New subregulation 3A(2) provides that for paragraph 3(5)(3) of the Act, the presentation of therapeutic goods is unacceptable if the name applied to the goods is not distinctive enough to allow for the identification of the goods for the purposes of recovery. This provision is the same as subregulation 6A(2), which was introduced by the earlier amendment regulations.
Item [3] amends regulation 6A to provide that the text of that regulation is the text which was inserted by the later amendment regulations.
Item [4] - Regulation 45 – amendment of fees
This item increases the discounted evaluation fees payable by a sponsor when an application is lodged to register a therapeutic device in certain circumstances, or to vary information in Australian Register of Therapeutic Goods (the Register) about a therapeutic device. The different discounted fees reflect the kinds of evaluation that could be undertaken in relation to an application to register therapeutic devices or vary information contained in the Register about those devices. The new discounted evaluation fees represent an approximate 1.6 per cent increase to the current discounted fees.
Item [5] - Regulation 45A, heading
This item amends the heading of regulation 45A to reflect the changes that will be made to regulation 45A by item [6], below.
Item [6] - Subregulation 45A (1)
Subregulation 45A(1) of the Principal Regulations currently provides that the annual charges for a licence payable by a person who is required to hold a manufacturing licence under Part 3-3 of the Therapeutic Goods Act 1989 (the Act) are reduced if wholesale turnover of therapeutic goods is less than $65,000. This item amends subregulation 45A(1) to increase the low turnover threshold by 1.6 per cent, to $66 000.
Item [7] – Schedule 9, Part 1, subclause 1 (1)
This item inserts a definition of haematopoietic progenitor cells in Part 1 of Schedule 9 to the Principal Regulations. Haematopoietic progenitor cells are defined to mean primitive pluripotent haematopoietic cells capable of self-renewal as well as maturation into any of the haematopoietic lineages, including committed and lineage-restricted progenitor cells. Haematopoietic progenitor cells are regenerative blood forming cells and can be obtained from peripheral blood, cord blood and bone marrow. These regenerative cells are used in procedures where a bone marrow transplant is required to replace bone marrow destroyed by the chemotherapy agents used to combat cancer.
Item [8] – Schedule 9, Part 2, item 9
Item [9] – Schedule 9, Part 2, new items 9AA
This item inserts new fee item 9AA into Part 2 of Schedule 9 to the Principal Regulations. This item covers inspections of manufacturing premises or operations related to licences for the manufacture of haematopoietic progenitor cells. New item 9AA imposes a fee of $440 for each inspector engaged per hour, or part of an hour.
Item [10] – Schedule 9, Part 2, items 9AB and 9AC
This item exempts haematopoietic progenitor cells from the fee for good manufacturing practice audits payable by manufacturers of human blood and blood products. A new fee item for the inspection of manufacturing premises or operations related to licences for the manufacture of haematopoietic progenitor cells will be introduced by item [9], above.
Item [11] – Schedule 9, Part 2
This item increases the fees in Part 2 of Schedule 9 to the Principal Regulations by approximately 1.6 per cent, except for those fees provided for by other items in the Regulations.