Stephen Parry (Tasmania, Liberal Party) Share this | Link to this | Hansard source

The Therapeutic Goods Amendment (Medical Devices and Other Measures) Bill 2008 [2009] amends the Therapeutic Goods Act 1989 in a number of functional ways, introducing a number of clarifications and refinements that have long been foreshadowed. The coalition supports these amendments although we do have some questions of the government to provide some points of clarification. In considering this relatively straightforward legislation we have to remain focused on the need for ongoing reform of the Therapeutic Goods Administration’s processes. The TGA works on a cost recovery basis in order for therapeutic products to be sold in Australia and the goods must be on the Australian Register of Therapeutic Goods. This process is 100 per cent funded through the collection of evaluation fees. The risk of that approach is that the government can be too tempted to impose additional regulatory burdens as it is the applicants intending to bring new products into the Australian market and not the government who have to fund the additional costs incurred.

We are making decisions in this parliament about additional layers but we are not committing additional government resources. We are spending other people’s money; that is why we must be ever vigilant to ensure that the balance is right. That is, the balance between the costs we impose on business and our core objective to maintain high standards in the registration of therapeutic goods. Not to get that balance right could mean that Australia could miss out on potentially beneficial products if relevant businesses decide not to pursue a listing due to excessive costs or long delays. So as we focus on ongoing and future reforms of the Therapeutic Goods Administration processes we must seek to maintain high standards while lowering the cost of compliance.

Feedback from industry stakeholders is that they support the current bill. However, the industry also pointed out that the current reforms are relatively minor and that further reform, including a recommitment to negotiations towards an Australian-New Zealand regulatory regime, is required. For example, the Australian Self Medication Industry described the current legislation as ‘a bit of tidying up at the margins’ and called for a renewed push to world’s best practice reform of the TGA. We certainly urge the Australian government to pick up where the Howard government left off in working with the new government in New Zealand to take up this reform.

Following a memorandum of understanding between the two governments in December 2003, negotiations to create the Australia New Zealand Therapeutic Products Authority commenced. I know Senator McLucas, the then responsible shadow, is on the record supporting the revival of negotiations on ANZTPA and I would hope that, regardless of the current legislation, the joint regulatory process will be revived as soon as possible. Industry is particularly keen to have the reform agenda restarted. In the process of reviewing this legislation with a range of industry bodies it was clear that whilst the current reforms are welcomed—in fact seen as overdue—more reform is required. So in speaking on this legislation I ask that the government gets on with the job to ensure that the stalled reform process is restarted as soon as possible.

As I have already advised the Senate, the coalition supports these amendments. These amendments, in brief, seek to achieve the following: exempt medical devices from the operation of the act to allow for stockpiling and rapid availability in emergency situations and to declare these exemptions as not legislative instruments and therefore not disallowable, tighten the fit and proper person test for manufacturing licences and medical device conformity assessment certificates, adopt the European and United States pharmacopoeias in addition to the British Pharmacopoeia as default standards under the act, improve access to information from the TGA, clarify the regulation of advertising of therapeutic goods, and align criminal penalty provisions with current policy. These are largely technical amendments designed to enhance the operation of the TGA.

The one area where the coalition would like some further information from the government is that of exemptions for medical devices that are required in an emergency, or that need to be stockpiled for a potential emergency, which can be granted by the minister. Clearly, this is an important provision and is required only because previous amendments to the Therapeutic Goods Act distinguish between medical devices and other therapeutic goods without giving medical devices access to the exemption provisions already in the act.

However, in seeking to clean up this anomaly, the government is proposing to go further. We would simply like to more clearly understand why. Unlike the current exemption, the government appears to be intent on making those exemptions not disallowable—that is, removing all oversight from the process of this parliament. When the government seeks to create an instrument that cannot be disallowed, it has an obligation to clearly set out the reasons why this is necessary. To date, the best we have got from the government is a reference to national security. We would like that explanation to be expanded upon. We will be looking for more adequate explanation from the government at the conclusion of the second reading debate. We understand from our discussions with the government that such an explanation will be forthcoming, and we appreciate that. The opposition shares the view of the Senate Standing Committee for the Scrutiny of Bills that there is a need for a more full explanation of what the intent is and why it is required. As I have said, the TGA is a fundamental part of Australia’s health regulation. It will need continual refinement to operate most effectively. I again urge the government to act and have a joint regulatory initiative with New Zealand, which was commenced under the Howard government. I again place on record that we do support the bill.

Carol Brown (Tasmania, Australian Labor Party) Share this | Link to this | Hansard source

I rise to speak briefly on the Therapeutic Goods Amendment (Medical Devices and Other Measures) Bill 2008 [2009]. By way of context, the Therapeutic Goods Act 1989 requires that therapeutic goods be registered, listed or included in the Australian Register of Therapeutic Goods before they can be lawfully imported into, manufactured in, supplied in or exported from Australia. The act also requires a person to obtain a manufacturing licence in order to manufacture therapeutic goods in Australia. The Therapeutic Goods Administration, the TGA, is responsible for administering the provisions of the legislation as the TGA’s objective is to provide a national framework for the regulation of therapeutic goods in Australia to ensure the quality, safety, and performance of medical devices.

The bill before us proposes a range of amendments to the Therapeutic Goods Act. The majority of these proposals were to be implemented with the proposed joint regulatory scheme in New Zealand, which was postponed in July 2007 due to the New Zealand government’s decision to not proceed with enabling legislation due to insufficient parliamentary support. The Rudd government has decided to pursue these long-overdue regulatory reforms in an Australia-only context while negotiations on the Australia New Zealand Therapeutic Products Authority remain postponed. These reforms will strengthen the existing regulatory framework for therapeutic goods and improve protections for consumers. Public consultation outlining the government’s plans for reforms to the therapeutic goods regulatory framework was undertaken in late July and early August last year.

The industry strongly supported progress in these areas, especially as changes were delayed for several years in anticipation of the Australia-New Zealand therapeutic goods authority legislation. Therefore, this bill amends the Therapeutic Goods Act 1989 in a number of ways. First, as has already been pointed out, it incorporates into the act provisions allowing the stockpiling and supply of medical devices to deal with emergency situations without the requirement for such devices to comply with the act. These provisions are based on similar provisions added to the act in 2002 allowing medicines to be stockpiled and supplied in emergency situations. These emergencies could include an act of bioterrorism or the emergence of a new highly contagious disease in Australia. In 2002 the then parliamentary secretary, in introducing the bill, explained that the amendments were necessary to strengthen the ability of the Commonwealth to plan for and respond to national emergencies in which there was the potential for large numbers of people to require emergency treatment. She gave us examples of such acts of bioterrorism or the emergence of a new highly contagious disease in Australia. Exactly the same rationale applies to the amendments contained in this bill.

The act presently operates very effectively to ensure that medical devices supplied in Australia to meet our daily healthcare needs meet very high standards of manufacture and quality control in general. It is an offence to supply devices that have not been approved by the Therapeutic Goods Administration. However, in the event of a national emergency there may be a need for the government to supply large volumes of goods and, as such, it may need to source these volumes from manufacturers who do not regularly supply goods to the Australian market and who have not sought to have their products approved by the TGA. The amendments in schedule 1 to the bill allow the minister to exempt devices from the requirements of the act so they can lawfully be stockpiled and made available in an emergency. The minister can only make such an exemption if she or he is satisfied that it is in the national interest to do so. The minister’s power may only be delegated to the Secretary of the Department of Health and Ageing. The minister may impose conditions on the exemption, including limiting the people allowed to import, manufacture or supply devices, and must notify those people of any other conditions on the exemption. Breaching a condition of exemption is a criminal offence.

Second, the bill gives effect to a range of amendments which have been in contemplation for a number of years and which were to have been adopted as part of the proposed Australia New Zealand Therapeutic Products Authority. It replaces an unduly subjective and harsh test of who is a fit and proper person to hold a manufacturing licence with a much narrower and more objective test requiring the secretary to have regard to breaches of the act or offences against it together with offences involving fraud or dishonesty over the previous 10 years. Again, just by way of background, the act was amended in 2003 to introduce a ‘fit and proper persons’ test. The aim of the test was to mitigate the risk posed by those who have already breached or may be coerced or tempted to breach manufacturing standards. However, the test has proven difficult to administer and has been criticised by some in industry as elaborate, complex and intrusive.

The main problems identified with the existing legislation are that it requires the fitness and propriety of a very broad range of people—the applicant, a senior manager or any other person who controls the applicant—to be assessed. It requires a very broad range of conduct to be considered, including the conduct of additional third parties and irrelevant conduct, such as convictions for minor traffic offences. It requires a decision maker to exercise a significant amount of discretion and to determine what matters are relevant.

The legislation does not set out an exclusive list of factors that can be considered, nor balance all relevant factors to determine whether a particular person is a fit and proper person. It does not contain sufficient powers to enable the TGA to monitor the ongoing suitability of a person to hold a manufacturing licence or a conformity assessment certificate. The new test, requisite amendments of which are contained in this bill, will require the secretary to have regard to past breaches of manufacturing licences or conformity assessment certificates, offences against the act or corresponding state law, and offences involving fraud or dishonesty over the previous 10 years. The persons covered by the test are the applicant, senior managers of the applicant’s affairs, and shareholders with more than one-fifth of the shares or votes.

The bill also establishes the United States Pharmacopoeia and the European Pharmacopoeia as alternative default standards to the British Pharmacopoeia—I really want Senator Back here to help me with the pronunciation—which standard goods must comply with if the minister has not determined other standards. As I have noted, this will give manufacturers greater flexibility in choosing what standard to comply with when providing goods to the Australian market.

The provisions will allow the TGA to release a wider range of information to inform members of the public about the therapeutic goods and devices that are available in Australia and to further assist them to make better informed choices and decisions about their use of therapeutic products. They will also allow the TGA to publish the minutes and deliberation of expert advisory committees as well as the summaries of the evaluation of applicants for the registration of prescription medicines.

The existing provisions governing release of information to other regulators has also proven to be unduly restrictive and operationally difficult, and the amendments also address these issues. In this regard the bill also seeks to widen the provisions of the Therapeutic Goods Act, allowing the secretary to release information obtained under the act to other regulatory agencies or to the public.

Finally, the bill makes technical amendments to clarify the operation of the provisions limiting the claims that can be made in advertisements for therapeutic goods and to bring the criminal offences provisions in line with the latest criminal law policy. Therefore, the amendments to the Therapeutic Goods Act contained in this bill represent logical, good public policy. As I noted earlier, the majority of these proposals were to be implemented in a joint regulatory scheme with New Zealand, which was postponed in July 2007. However, the government has decided to pursue these long-overdue regulatory reforms in Australia.

These reforms will strengthen the existing regulatory framework for therapeutic goods and improve protection of consumers. Public consultation outlining the government’s plan for reforms to the therapeutic goods regulatory framework was undertaken in late July and early August last year, and the industry strongly supported progress in these areas. I commend the bill to the chamber.

Jan McLucas (Queensland, Australian Labor Party, Parliamentary Secretary to the Minister for Health and Ageing) Share this | Link to this | Hansard source

I thank those who have contributed to the debate on the Therapeutic Goods Amendment (Medical Devices and Other Measures) Bill 2008 [2009]. As we have heard, the bill amends the Therapeutic Goods Act 1989 in a number of ways. Firstly, it incorporates into the act provisions allowing the stockpiling and supply of medical devices to deal with emergency situations. These provisions are based on similar provisions allowing medicines to be stockpiled and supplied in emergency situations which were added to the act in 2002. The amendments in schedule 1 to this bill allow the minister to exempt devices from the requirement of the act so they can lawfully be stockpiled and made available in an emergency. These exemptions are not subject to parliamentary scrutiny. This follows from advice received by the then government in 2007 which recommended that the contents of the stockpile should be classified as ‘confidential’ to ensure that would-be bioterrorists were not able to find out what preparations Australia had made for dealing with possible bioterrorist acts. For this reason the bill also amends the act so that similar exemptions applying to medicines are not to be subject to disallowance.

This bill also gives effect to a range of amendments which have been in contemplation for a number of years and which were to have been adopted as part of the Australia New Zealand Therapeutic Products Authority, or ANZTPA. Following the decision by the New Zealand government, in July of last year, not to proceed with legislation enabling ANZTPA, the Rudd government decided to pursue these amendments in an Australia-only context. These post-ANZTPA reforms include a range of amendments that I think have been fully canvassed in the second reading debate.

In response to Senator Parry’s questions around exemptions, I would like to emphasise that a decision made by the minister to exempt a good for emergency stockpiling is not a legislative instrument as it would not alter or determine the legislation but, rather, would simply apply the legislation to particular goods needing to be stockpiled, much like the issuing of a permit. Instruments of this kind are, by definition, not legislative under the Legislative Instruments Act 2003. I should also point out that the minister will only be able to make such an exemption if she or he is satisfied that it is in the national interest to do so, and the minister’s powers may only be delegated to the Secretary of the Department of Health and Ageing. Further to this, the minister would only make such a decision based on advice from an expert group, including the Chief Medical Officer and members of the Office of Health Protection, the Office of Chemical Safety and the Australian Radiation Protection and Nuclear Safety Agency, with access to advice from security and intelligence services. It is not the sort of decision that could be made without such expert advice. Subjecting such a decision to disallowance would allow the Senate to substitute its judgment, that the potential risk of the remedy outweighed the risk of a threat, for the judgment of a minister acting on the best advice in the country.

I will go to the question that was raised by the Senate Standing Committee for the Scrutiny of Bills about strict liability. The committee made comments regarding strict liability offence provisions for those who breach the conditions of a medical device emergency stockpile exemption. I should point out that this is based on the current strict liability offence provision, under section 22 of the act, for those who breach a condition of emergency exemption for the stockpiling and supply of medicines. It is important that conditions imposed on an exemption for medical devices be adhered to as they are the mechanism by which we can ensure that these devices are stored appropriately, that there is good record-keeping for them and that access to and supply of them to the Australian community will happen in the event they are called upon. The requirements imposed by the new section on the minister are that all reasonable steps must be taken to inform the person or people who import, manufacture or supply these devices of the exemption and advise them of any change to or revocation of the exemption.

It is highly unlikely that any other person will have access to devices covered by the exemption and therefore they could not be in a position to breach any of the conditions. Imposing strict liability on the subsection 4MNB(5) offence of breaching a condition of an emergency exemption for medical devices obviates the need for the prosecution to prove intent in the breach. The reason for this is to provide an effective deterrent to breaches of the conditions and ensure compliance with the conditions, which, as I have explained, are crucial to the effectiveness and readiness of the emergency stockpile.

If an importer, manufacturer or supplier mistakenly breaches the conditions, the Criminal Code provides a defence of an honest and reasonable mistake of fact. Therefore, the strict liability offence is squarely targeted to those who have been entrusted under an exemption to make available medical devices for the emergency stockpile and who would have been informed of the conditions and their obligations in this important role.

The bill also deals with the fit and proper person test, default standards for medicines, information disclosure and the use of restricted representations in advertising. It also makes technical amendments to all offence provisions to bring them into line with the latest policy on how these should be expressed. The current test in deciding who is a fit and proper person is subjective in that there is no limit on the matters the secretary may consider and there is no guidance as to who is a person ‘likely to have effective control’, and it is unduly harsh in that the secretary must have regard to any conviction against any law of the Commonwealth or a state or territory, no matter what the crime or when it took place. Not only has the test been criticised by industry for this reason, but it is also administratively problematic. The amendments in schedule 3 of the bill replace this test with a much narrower test requiring the secretary to have regard to breaches of the act or offences against it, together with offences involving fraud or dishonesty over the previous 10 years.

Another amendment that will assist industry and thus consumers involves increasing the default standard and medicines. This will make it easier for some overseas manufacturers to access the Australian market. The act currently provides that, unless the minister determined standards for therapeutic goods, they had to comply with the requirements of the British Pharmacopoeia. Many manufacturers based in the United States or Europe supply the Australian market and, as part of the ANZTPA consultation process, industry pressed for the inclusion of the United States Pharmacopoeia and the European pharmacopoeia as alternative default standards.

Schedule 4 of the bill contains a series of amendments to include these pharmacopoeias as default standards with the same standing as the British Pharmacopoeia. That has been strongly welcomed by industry. I am interested in Senator Parry’s comments about how these amendments are a little bit around the edge; they were very strongly welcomed by participants in a workshop conducted by the TGA as part of its formal consultations in the middle of last year and were warmly welcomed by industry. This government is committed to improving access to regulatory information gathered or generated by the TGA. At present, the act provisions setting out when the secretary can release information obtained in the act to other regulatory agencies or to the public are unduly restrictive and have proved operationally difficult. The government has therefore decided to broaden the public access to information under the act. In particular, the TGA will publish a greater range of information about goods included on the Australian Register of Therapeutic Goods on its website to inform members of the public about the therapeutic goods and devices available in Australia and assist them to make better informed choices and decisions about their use of therapeutic products.

Senator Parry spoke of the need for further work on the therapeutic goods regulatory regime. The government will be pursuing further reforms. We have made that very clear to industry. We have made it clear that this piece of work is the first tranche of reform that is clearly needed to the Therapeutic Goods Act and its regulations and operations. They were delayed—and I do not blame the former government for that. There was a desire by the former government to pursue a trans-Tasman arrangement. That was not able to be delivered. My view is that we need to progress the work that was undertaken by the TGA, by the department and, most importantly, by industry over many years at great expense. We need to progress those reforms in an Australia-only context.

The reforms will include adding to the act a power for the secretary to suspend the registration or listing on the Australian Register of Therapeutic Goods of a medicine if the secretary is concerned about its safety. Under the act, as it currently stands, medical devices can be suspended from the ARTG for up to six months if there are concerns about the safety of the device that could be addressed by corrective action during the period of suspension. However, such action is not possible with medicines. If serious concerns emerge about the safety of a medicine, the secretary’s only option is to cancel the registration or listing even if the problems are such that they could quickly be addressed by the manufacturer. This is a real problem that I think we need to address. The situation at the moment is that if even a very minor mistake or error has been made—a mistake on a label, for example—the only option the TGA has is to remove the medicine or therapeutic good from the register in total. That means that that therapeutic good, medicine or device cannot be accessed by the Australian community. This is a sensible amendment—an amendment that provides continuity of access providing that the safety of the Australian public is protected. I look forward to this amendment occurring.

If the registration or listing is cancelled, once the problem has been addressed the sponsor of the medicine must apply to have the medicine reregistered or relisted and pay the relevant application fees. Senator Parry, I understand the point you made about cost to industry and I say our government is very committed to reducing cost to industry. Therefore, this amendment is not only more efficient but also a saving to industry, and therefore consumers, and will retain access to safe and efficacious medicines for the Australian community.

We will also be amending the law relating to manufacturing licences. At present, a number of licences cover more than one site and licences do not clearly indicate the steps in manufacture or the range of goods that may be produced under the licence. There is no ability for manufacturers to apply to vary their licences and no ability to transfer licences from one manufacturer to another. We intend to address these issues by amending the act to provide that a licence may only cover one site and must specify the manufacturing process and the range of goods it covers. Once again, this is a sensible and practical amendment that will deliver effective regulation—in fact, even safer regulation.

At the moment, a licence is provided to a sponsor or a manufacturer for a range of licensed sites. This can mean that if there is a problem at one site the response is to respond to all manufacturing sites. In this way, we license every site. The only condition on that is if there are two physical sites that are co-located we may be able to put that manufacturing under one licence, but it means we will be able to regulate more effectively each manufacturing site and be able to monitor the production line, especially when they move from one site to another.

We will also be moving to put in place a regulatory framework for homoeopathic and anthroposophic medicines. Under current arrangements, the regulations exempt many of these medicines from the need to be listed on the Australian Register of Therapeutic Goods and from the manufacturing quality requirements of the act. The Expert Committee on Complementary Medicine in the Health System recommended in 2003:

Homoeopathic medicines and related remedies that make therapeutic claims should be regulated to ensure they meet appropriate standards of safety, quality and efficacy.

The government consulted extensively with homoeopathic and anthroposophic practitioners and suppliers on an appropriate level of regulation for these substances, and we will take industry responses into account in framing amendments.

A further range of amendments that we intend to pursue relates to the TGA’s electronic listing facility. It has a list of permitted ingredients based on schedules included in the regulations to the act, but it includes many substances that were grandparented into the scheme when the act came into effect in 1991 and are not identified in the regulations. The list is published on the TGA website. Persons wishing to add substances to the list of permitted ingredients currently apply to the TGA and if the application is accepted the new ingredient is notified in the gazette. As a result, there is no single legal source for the ingredients which may be included in medicines. We propose to address this by empowering the minister to make a legislative instrument setting out lists of permitted ingredients and prohibited ingredients for different classes of medicines. Persons wishing to list a medicine for domestic use must certify that it contains only permitted ingredients and no prohibited ones. The secretary, in considering an application to list a medicine for export purposes, must have regard to whether it complies with the list. A person may apply to list a new ingredient on the permitted ingredients list, and the minister must consider this application.

We also propose other amendments. Since 2003 the TGA has operated an electronic system to permit sponsors to list low-risk medicines containing pre-approved ingredients on the Australian Register of Therapeutic Goods without prior scrutiny by the TGA. As part of the listing process, sponsors must certify a range of matters relating to the safety and the quality of medicines and are subject to prosecution under section 21A of the act for providing incorrect certifications. A similar system has recently been introduced for including low-risk medical devices on the TGA. We propose to regularise this process to provide for computer programs to be used to facilitate that decision making.

The amendments to this bill are the first instalment of an ongoing program of reform to the act. Australia has been served well by the TGA in the past. It is important that the regulatory regime that the TGA implements is kept up to date so that the TGA and the industry it regulates can operate as efficiently as possible and, as a result, Australian consumers can continue to have timely access to safe and effective therapeutic goods. I commend the bill to the Senate.

Question agreed to.

Bill read a second time.

Ordered that consideration of this bill in Committee of the Whole be made an order of the day for a later hour.