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Therapeutic Goods Amendment (Medical Devices and Other Measures) Bill 2008 [2009]

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2008

 

 

 

 

 

THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA

 

 

 

 

 

SENATE

 

 

 

 

 

 

 

THERAPEUTIC GOODS AMENDMENT (MEDICAL DEVICES AND OTHER MEASURES) BILL 2008

 

 

 

 

 

 

 

 

EXPLANATORY MEMORANDUM

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Circulated by authority of Senator the Hon Jan McLucas, Parliamentary Secretary to the Minister for Health and Ageing)

 

 



THERAPEUTIC GOODS AMENDMENT (MEDICAL DEVICES AND OTHER MEASURES) BILL 2008

 

OUTLINE

 

The Therapeutic Goods Amendment (Medical Devices and Other Measures) Bill 2008

(the Bill) makes a series of amendments to the Therapeutic Goods Act 1989 (the Act).  These include:

  • introducing provisions to exempt medical devices from the operation of the Act so that they can be made available for use in a health emergency;
  • reformulating the test of whether  person is a “fit and proper person” to hold a manufacturing licence or a medical device conformity assessment certificate;
  • adopting the European Pharmacopoeia and United States Pharmacopeia as additional default standards under the Act;
  • amending the information release provisions to support public access to an increased range of information held by the Therapeutic Goods Administration (the TGA);
  • clarifying the operation of the advertising provisions to ensure that controls over restricted representations and prohibited representations apply to advertisements in all media; and
  • amending penalty provisions across the Act to align them with current policy on how these are formulated.

 

Exemption from the Act for medical devices for use in emergency

The Act was amended in 2002 to allow the Minister to exempt therapeutic goods from the provisions of the Act so that the goods could be stockpiled for use in a potential public health emergency, or made available quickly in Australia to deal with an actual emergency.  However, the Act has subsequently been amended to regulate medical devices separately to other therapeutic goods, and as a result the exemption provisions no longer apply to medical devices. 

 

The proposed amendments largely mirror the exemption provisions that currently apply to therapeutic goods, other than medical devices.  The Bill also amends the current exemption provisions to remove the requirement that instruments allowing the stockpiling of therapeutic goods be disallowable.  The Government has been advised that the contents of the stockpile should have a national security classification of “Confidential”, as knowledge of the contents of the stockpile could assist potential bio-terrorists to plan attacks using diseases or other agents for which Australia was not well prepared.  Against this background the Government does not believe that exemption instruments should be tabled in Parliament and subject to public scrutiny.

 

Other amendments

Amendments relating to public access to information, default standards for products, and “fit and proper person” testing were to have been adopted as part of the legislation underpinning the proposed Australia New Zealand Therapeutic Products Agency (ANZTPA), to have been established under a treaty between Australia and New Zealand.  However, in July 2007 the New Zealand Government announced that it was not proceeding with the necessary legislation in the New Zealand Parliament as it would not be passed, and further work on ANZTPA was suspended. 

 

The Australian Government has now decided to proceed with these amendments in an Australian-only context. 

 

The Act currently requires the Secretary to apply a very broad test in deciding whether an applicant is a “fit and proper person” to be granted a manufacturing licence or conformity assessment certificate.  The test is effectively unworkable as well as being unduly broad, and the amendments will narrow and clarify its scope in line with similar tests in other legislation.

 

At present the Act effectively establishes the British Pharmacopoeia as the “default standard” to which products must conform unless another standard has been determined by the Minister for Health and Ageing.  Amendments will add the European Pharmacopoeia and United States Pharmacopeia as alternative default standards.

 

The amendments to the information release provisions will give effect to the Government’s commitment to provide public access to a much wider range of information held by the TGA, including details of entries on the Australian Register of Therapeutic Goods, summaries of evaluations of applications to register new therapeutic goods, and the records of advisory committees established under the Act.

 

The Act currently regulates advertisements of therapeutic goods, and requires pre-approval of advertisements in “mainstream” media but not other media, and bans or limits the use of some representations in advertisements for therapeutic goods.  As the application of these provisions to different kinds of advertisements is unclear, the amendments will clarify the operation of these provisions.

 

This Bill also includes amendments to criminal offence provisions to bring them into line with current policy relating to expressing the maximum penalty under an offence provision.

 

FINANCIAL IMPACT STATEMENT

 

As the operations of the TGA are entirely cost-recovered from industry, this Bill will have no financial impact on the government. 



 THERAPEUTIC GOODS AMENDMENT (MEDICAL DEVICES AND OTHER MEASURES) BILL 2008

 

 

NOTES ON CLAUSES

 

Clause 1  Short title

This sets out the title of the Bill, once enacted, as the Therapeutic Goods Amendment (Medical Devices and Other Measures) Act 2008 .

 

Clause 2  Commencement

This clause provides that the Bill commences on Royal Assent, and that the various Schedules commence as set out in the table. 

 

Schedules 1 and 2 commence the day after Royal Assent, as it is important that the Government is able to exempt goods from elements of the Act to allow them to be stockpiled or supplied in a public health emergency.   

 

Schedule 3 is specified to commence on a day to be proclaimed but no later than 6 months after Royal Assent.  This will ensure that systems to ensure compliance with the new arrangements are put in place before the arrangements come into force. 

 

Schedule 4 will commence on 1 July 2009.  This fixed date will provide certainty to sponsors of medicines about the standards medicines have to meet at that time.

 

The remaining Schedules commence the day after Royal Assent, as they do not require changes to existing practices in industry or government,

 

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 relevant Schedule, and any other item in a Schedule to this Bill has effect in the way set out in the provision.  The Bill makes amendments to the Therapeutic Goods Act 1989 (the Act) and includes application and transitional provisions.

 

 

 



SCHEDULE 1 - MEDICAL DEVICES

 

The Act currently imposes various requirements on medical devices, such as inclusion in the Australian Register of Therapeutic Goods (the ARTG).  This Schedule provides for the exemption of therapeutic goods from the requirements of the Act so that the goods could be stockpiled for use in a potential public health emergency, or made available quickly in Australia to deal with an actual emergency. 

 

Item 1

Section 41BB is part of the overview to Chapter 4 on medical devices, and provides a list of administrative processes under the Chapter.  This item amends section 41BB to add

exempting medical devices from the Chapter to deal with emergency situations, as another administrative process.

 

Item 2

This item adds a new Part 4-6A setting out the process for exempting medical devices to deal with emergencies.  New sections 41GR to 41GY are included in this new Part.

 

New section 41GR summarises the Part.

 

New section 41GS empowers the Minister to exempt specified medical devices from various regulatory requirements under Chapter 4 (subsection (1)) if the Minister is satisfied that the exemption should be given to allow devices to be stockpiled to deal with a potential threat to public health arising from a future emergency, or to allow devices to be made available urgently to deal with an actual threat arising from an emergency that has occurred (subsection (2)). 

 

The exemption takes effect on the day it is made or on a specified later day (subsection (3), and ceases to have effect as specified in the exemption, unless revoked earlier (subsection (4)).  Subsection (5) provides that the exemption ceases if the device is included on the ARTG under the usual processes of the Act. 

 

Subsection (6) states for the benefit of readers that an exemption under subsection (1) is not a legislative instrument.  As the exemption is not a legislative instrument within the meaning of the Legislative Instruments Act 2003 , it is not subject to requirements of that Act such as registration on the Federal Register of Legislative Instruments or Parliamentary scrutiny.  This subsection explains rather than creates the exemption.

 

Subsection (7) provides that section 41BE is to be disregarded in working out the kinds of medical devices covered by an exemption under subsection (1).  The effect of this is that the reference to “kinds of devices” in subsection (1) has its ordinary meaning, not the meaning derived by applying subsection 41BE.

 

New section 41GT allows the Minister to specify conditions on the exemption with reference to a wide range of matters, and provides that a breach of a condition does not mean the devices are no longer exempt.  Paragraph 41GT(c) provides that conditions may include the persons or class of persons who may import, manufacture, supply or export devices covered by the exemption.

 

New section 41GU allows the Minister in writing to revoke or vary an exemption or condition of exemption (subsections (1), (2) and (3). Subsection (4) provides that a revocation or variation takes effect as specified by the Minister, but not less than 28 days after it is made, unless the Minister considers that it is necessary to prevent an imminent risk of death, serious illness or serious injury, in which case it takes effect when it is made.

 

New section 41GV requires the Minister to take reasonable steps to give a copy of the exemption, and any variation or revocation, to each person allowed under a condition imposed under paragraph 41GT(c) to import, manufacture, supply or export devices covered by the exemption.

 

New section 41GW requires the Secretary to publish in the Gazette , and the Minister to cause to be tabled in Parliament, any exemption, and variation to or revocation of an exemption, made to allow medical devices to be supplied because of an actual threat to public health caused by an emergency that has occurred.

 

New section 41GX provides that the Commonwealth, the Minister or his or her delegate is not liable to a person in respect of any loss, damage or injury of any kind suffered by the person or anyone else as the result of the use of medical devices covered by an exemption.

 

New section 41GY allows the Secretary to arrange for the disposal of unused exempt devices at the end of an exemption period (subsections (1) and (2)) in accordance with regulations made under subsection (3).  The regulations must not set out a method of disposal that allows a benefit for any person (including the Commonwealth) other than the owner of the device (subsection (4)).

 

Item 3

This item repeals the existing heading to Part 4-7 and substitutes it with a new heading to clarify that there are means of exempting devices from inclusion in the ARTG other than those set out in that Part (item 2 refers).

 

Item 4

This item amends section 41H which summarises Part 4-7, to clarify that new Part 4-6A also exempts devices from inclusion in the ARTG.

 

Item 5

This item amends section 41J which summarises Part 4-8, to make it clear that the Part allows the Secretary to seek information relating to exemptions under new Part 4-6A.

 

Item 6

This item inserts a new section 41JCA.  Subsections (1) and (2) allow the Secretary to give a person subject to a condition of an exemption under new subsection 41GS(1), a notice requiring them to supply a range of information relating to the exempt devices, including information prescribed in the regulations.

 

Subsection (3) provides that the person must be given at least ten days to comply with the notice, and subsection (4) allows the notice to require the information to be provided in accordance with specified software requirements.

 

Items 7 to 10

These items expand the offence provisions in sections 41JG (including the note), 41JH and 41JI to cover failing to give information required under new section 41JCA (item 6 refers), providing false or misleading information, or providing false or misleading documents. 



Item 11

Section 41JJ provides that a person is not excused from giving information or a document under a notice given under section 41JD, 41JE or 41JF on the ground that to do so would tend to incriminate the person or expose the person to a penalty.  This provision is necessary to ensure compliance with the necessary requirements and the monitoring of medical devices that have been supplied to the public and that have not been subjected to the required evaluation or assessment under the Act.  The defence against self-incrimination is restricted under section 41JJ.  Any information or document given under these provisions cannot be used in criminal or civil proceedings except for the purposes of proceedings connected with the offences set out in sections 41JH or 41JI, relating to the provision of false or misleading information or documents.

 

This item amends section 41JJ to include a reference to new section 41JCA (item 6 refers).

 

Items 12 and 13

Subsection 41KA(1) deals with the recall of medical devices.  Item 5 of the table allows the Secretary to impose requirements on a person supplying a device if the device is not on the ARTG or otherwise exempt, and item 12 of the Bill adds reference to an exemption under new subsection 41GS(1).

 

Item 13 of the Bill adds new item 5A to the table.  The new item allows the Secretary to impose requirements on a person supplying a device if the device is exempt under new subsection 41GS(1) and the Secretary is satisfied that it is not fit to be used for its intended purpose.

 

Item 14

This item amends the introduction to Part 4-11, which deals with offence and civil penalty provisions relating to medical devices, to add a reference in section 41M to the new Division 3A (item 34 refers).

 

Items 15 to 21

These items amend the offence and civil penalty provisions in sections 41MA and 41MAA, which currently provide that it is an offence, or a contravention of a civil penalty provision, to import, supply, or export a medical device that does not comply with the essential principles without the consent of the Secretary.  These amendments effectively provide that it is not an offence or a contravention if the device is exempt under new subsection 41GS(1).

 

Items 22 to 26

These items amend the offence and civil penalty provisions in sections 41ME and 41MEA.  These sections currently provide that it is an offence, or a contravention of a civil penalty provision, to manufacture and supply or export a medical device that does not comply with the conformity assessment procedures.  These amendments effectively provide that it is not an offence or a contravention if the device is exempt under new subsection 41GS(1).

 

Items 27 to 30

These items amend the offence provisions in section 41MF, which currently provide that it is an offence to supply or export a medical device that does not comply with the conformity assessment procedures.  These amendments effectively provide that it is not an offence if the device is exempt under new subsection 41GS(1).

 



Items 31to 33

These items amend the offence and civil penalty provisions in sections 41MI and 41MIB.  These sections currently provide that it is an offence, or a contravention of a civil penalty provision, to import, export, supply or manufacture a medical device that is not included on the ARTG or is not otherwise exempt or approved.  Amendments by items 31 and 33 effectively provide that it is not an offence or a contravention if the device is exempt under new subsection 41GS(1).  Item 32 rectifies an incorrect reference in paragraph 41MIB(1) to “paragraphs” by replacing it with a reference to “subparagraphs”.

 

Item 34

This item amends the offence provision in section 41MK, which currently provides that it is an offence to wholesale a medical device that is not included on the ARTG or is not otherwise exempt or approved.  This amendment effectively provides that it is not an offence if the device is exempt under new subsection 41GS(1).

 

Item 35

This item adds a new Division 3A to Part 4-11 setting out criminal offences and civil penalty provisions relating to new Part 4-6A. 

 

New section 41MNB makes it an offence if a person does an act or omits to do an act in relation to a medical device that is covered by an exemption under new section 41GS and that act or omission results in the breach of a condition of the exemption. 

 

This measure corresponds to the sanctions created for medicines that are the subject of an exemption under section 18A of the Act as set out in subsections 22(7AB) to (7AE), and subsections 20(2A) to 2D.  The maximum penalty levels imposed under new section 41MND also reflects the penalty levels imposed under the corresponding offences applying to medicines that are exempt under section 18A of the Act. 

 

The levels of penalties imposed under the Act were increased as a part of the measures introduced by the Therapeutic Goods Amendment Act (No.1) 2006 (the 2006 Amendment Act) which provided additional enforcement options to enhance the Therapeutic Goods Administration’s ability to secure compliance with the Act and ensure the adequate protection of public health and safety.  The 2006 Amendment Act supplemented a number of existing criminal offences with a tiered offence regime, which included offences of strict liability and higher penalties for more culpable conduct resulting in harm or injury.  It also introduced civil penalties as an alternative sanction to offences under the Act.  The civil penalty provisions imposed penalties of between 3,000 to 5,000 penalty units for an individual (currently $330,000 to $550,000) and between 30,000 to 50,000 penalty units for a corporation (currently $3,300,000 to $5,500,000).

 

Medical devices that are to be used for public health emergencies need to be properly secured, stored under appropriate conditions, information accurately recorded and kept, and supplied only under direction by the Commonwealth.  There may be circumstances in which these devices will be stored by a private entity for a particular period and their supply subject to strict directions by the Commonwealth.  That private entity could also be the source and the manufacturer of the exempt medical devices.  It is therefore necessary that the conditions of the exemption relating to the supply, manufacture and storage of these devices be enforceable so that they can be used effectively for the purpose specified by the exemption instrument.

 

Public health emergencies would include acts of bioterrorism and pandemics.  It is important that the conditions of exemption are appropriately enforced to ensure that these devices can be urgently supplied without difficulties during public health emergencies.  Given the importance of having an effective deterrent to action that could adversely affect the supply of these devices during public health emergencies, and the importance of ensuring that persons involved in the supply, storage, importation and manufacture of these devices comply with these conditions, the imposition of high level of penalties in relation to breaches of conditions of these exemptions is warranted.  The high level of penalty is particularly warranted where the act or omission relating to the breach of a condition of the exemption is likely to cause a serious risk to public health. 

 

In new section 41MNB subsection (1) provides that it is an offence to do an act or omit to do an act in relation to a medical device covered by an exemption under new subsection 41GS(1) if the act or omission breaches a condition of exemption and is likely to cause a serious risk to public health.  The penalty is imprisonment for 5 years or 2,000 penalty units (currently $220,000) or both.  

 

Subsection (3) provides that it is an offence to do an act or omit to do an act in relation to a medical device covered by an exemption under new subsection 41GS(1) if the act or omission breaches a condition of exemption.  The penalty is imprisonment for 4 years or 240 penalty units (currently $26,400) or both.

 

Under subsections (2) and (4) respectively, strict liability applies to the physical element of the offences under subsections (1) and (3) that the device is a kind covered by an exemption in force under new section 41GS.  As copies of the exemption, or any variation or revocation of an exemption under new section 41GU, will be provided to relevant persons, it is appropriate that strict liability applies to paragraph (b) of new subsections 41MNB(1) and (3).  The requirement to prove fault in relation to those elements would undermine the deterrent effect of the offence.

 

Subsections (5) and (6) establish a strict liability offence to do an act or omit to do an act in relation to a medical device covered by an exemption under new subsection 41GS(1) if the act or omission breaches a condition of exemption.  The penalty is 60 penalty units (currently $6,600).  The strict liability offence will support the integrity of the exemption mechanism by ensuring that persons involved in the storage and supply of these devices comply with the relevant conditions attached to the exemption.

 

New section 41MNC is the alternative sanction imposing civil penalties for acts or omissions by a person that result in a breach of a condition of exemption.  This provision corresponds to section 22AA applying to acts or omissions in relation to therapeutic goods, other than medical devices, that breach a condition of a section 18A exemption.  Both civil penalty provisions provide for a maximum penalty of 5,000 penalty units for an individual (currently $550,000) and 50,000 penalty units for a body corporate (currently $5,500,000).  The high level of civil penalty is necessary to ensure that persons and bodies corporate involved in the supply, manufacture, export or storage of the medical devices comply with the applicable conditions of the exemption.  This is particularly the case as these medical devices are required to deal with public health emergencies such as during a pandemic or bioterrorism attacks.

 

New section 41MND is a civil penalty provision and provides that a person contravenes this provision if the person makes a representation that medical devices are of a kind covered by an exemption in force under new section 41GS and the representation is false or misleading.  The corresponding provision applying to medicines is set out in subsection 21B(3).  The civil penalty provision provides for a maximum penalty of 5,000 penalty units for an individual (currently $550,000) and 50,000 penalty units for a body corporate (currently $5,500,000).  The high level of civil penalty is necessary to ensure that individuals or body corporate do not advertise or represent medical devices as being the subject of an emergency exemption when they are not, as this could lead to public confusion during a public health emergency.

 

Item 36

Section 46A lists the premises which may be searched by an authorised person to find out whether the Act and regulations have been complied with.  This item adds to that list the premises of a person who is required to comply with a condition of exemption under new

subsection 41GS(1).

 

Item 37

Section 56A lists the matters in respect of which the Secretary may give certificates.  This item adds to that list certification that there was no exemption under new subsection 41GS(1) in relation to a particular medical device.

 

Items 38 and 39

These items amend section 57 to add a new subsection (11), providing that the Minister’s powers to exempt a device for stockpiling under new section 41GS may only be delegated to the Secretary.

 

Item 40

This item amends subsection 61(3A) dealing with the release of information by the Secretary to various State and Territory bodies, to add to the list of information that may be released information obtained under new section 41JCA.

 

 



SCHEDULE 2 - EMERGENCY EXEMPTION FOR THERAPEUTIC GOODS THAT ARE NOT MEDICAL DEVICES

 

The Act currently provides that instruments exempting therapeutic goods from the requirements for listing and registration, allowing for the stockpiling of therapeutic goods, are disallowable instruments.  In effect this means that exemptions are subject to the requirements of the Legislative Instruments Act 2003 and must be registered on the Federal Register of Legislative Instruments and tabled in Parliament.  This Schedule provides that exemptions are no longer disallowable instruments and therefore not subject to public scrutiny.

 

Item 1

This item amends section 18A to remove the requirement in subsection (9A) for exemptions made by the Minister under the section to allow therapeutic goods to be stockpiled for use in a possible future emergency to be subject to disallowance. 

 

As indicated in the Outline to this Explanatory Memorandum, the Government has been advised that the contents of the stockpile should have a national security classification of “Confidential”, as knowledge of the contents of the stockpile could assist potential bio-terrorists to plan attacks using diseases or other agents for which Australia was not well prepared.  Making exemptions disallowable is not consistent with maintaining the security of the contents of the stockpile.

 

The item inserts a new subsection (9A) to explain, for the benefit of readers, that an exemption made under subsection (1) is not a legislative instrument.  As the exemption is not a legislative instrument within the meaning of the Legislative Instruments Act 2003 , it is not subject to requirements of that Act such as registration or Parliamentary scrutiny.  This subsection explains rather than creates the exemption.

 

The item also inserts a new subsection (9B) requiring the Minister to provide a copy of any exemption, and variation or revocation of an exemption, to the persons covered by paragraph 7(d).  These are persons who may, under a condition of an exemption, import, manufacture, supply or export the exempt goods.

 

Item 2

This item amends subsections 18A(10) and (11) to provide that any variation or revocation of an exemption made under the section to allow medical devices to be supplied because of an actual threat to public health caused by an emergency that has occurred, must be published by the Secretary in the Gazette and tabled in Parliament by the Minister.

 

Item 3

This item amends subsection 57(10) to provide that the Minister may only delegate powers under section 18A to the Secretary.  At present the limitation on the delegation only applies to exemptions allowing therapeutic goods to be stockpiled.  As consideration of the national interest is required in making an exemption for both stockpiling and for supply of goods in an emergency, it is appropriate that the Minister’s power can only be delegated to the Secretary.

 

Item 4

This item provides that the amendments made by item 1 apply to exemptions made on or after the commencement of that item (the day after Royal Assent), while the amendments made by item 2 apply to variations or revocations made on or after the commencement of that item, regardless of when the exemption was made.



SCHEDULE 3 - FIT AND PROPER PERSON TEST

 

The Act currently requires the Secretary to apply a test in deciding whether an applicant is a “fit and proper person” to be granted a manufacturing licence or conformity assessment certificate.  This test is effectively unworkable and unduly broad.  This Schedule narrows and clarifies the scope of the test, in line with similar tests applied under other legislation.

 

Item 1

This item inserts a definition of a “major interest holder” of a body corporate into subsection 3(1).

 

Item 2

This item repeals paragraphs 38(1)(g) to (i) and substitutes new paragraphs (g) to (h).  Subsection 38(1) currently requires the Secretary, in deciding whether to grant a licence to a person to carry out steps in the manufacture of therapeutic goods, to grant a licence unless satisfied that the applicant, or a person participating in managing the applicant’s affairs, or a person who has effective control over the applicant, is not a fit and proper person within the meaning of subsection 38(1A).

 

This item replaces this test with one requiring the Secretary to grant the licence unless satisfied that:

  • the applicant (new subparagraph 38(1)(g)(i)),
  • a manager (being a person who makes, or participates in making, decisions that affect the whole, or a substantial part, of the applicant’s affairs) (subparagraph (ii), or
  • a major interest holder (subparagraph (iii)

has, in the past ten years:

  • been convicted of offences against therapeutic goods legislation or offences involving fraud or dishonesty (subparagraphs)(iv) and (v)), or
  • been required to pay a pecuniary penalty for contravention of civil penalty provisions under such laws (subparagraphs (vi) and (vii), or
  • breached a condition of a manufacturing licence or held a licence which was suspended or revoked (subparagraphs (viii) and (ix), or
  • been a manager or a major interest holder in a body corporate which had met the tests in subparagraphs (iv) to (ix) (subparagraph (x)).

 

The provision also allows regulations to be made under new paragraph 38(1)(h) to add other circumstances that the Secretary must take into account in reaching a decision on a manufacturing licence.  The intention of this provision is to allow the Government - subject to Parliamentary scrutiny - to act to address emergent circumstances by expanding the range of matters the Secretary must consider in making a decision to grant a licence.  Such matters may not necessarily be related to the fitness and propriety of an applicant, but could relate to other as yet unknown criteria which might affect the desirability of issuing a licence.

 

Item 3

This item repeals subsection 38(1) which sets out the fit and proper person test, and replaces it with a provision that a reference to a person convicted of an offence in new paragraph 38(1)(g) includes a reference to person who has been discharged without a conviction after an offence has been proved under section 19B of the Crimes Act 1914 , or equivalent State or Territory legislation.

 

It also adds a new subsection 38(1AA) providing that the regulation-making power under new paragraph 38(1)(h) is not limited by the matters set out in new paragraph 38(1)(g).

 

Items 4 to 6

These items make consequential changes to references in subsections 38(1B) and (2) to reflect the changes made by items 2 and 3.

 

Items 7 and 8

These items amend section 40 which deals with conditions on manufacturing licences.  Item 7 adds to the list of conditions in subsection 40(4) a new condition at paragraph (ac) that the licence holder will give the Secretary information required in a notice under new subsection 40(6) to be added under item 8.  This new subsection empowers the Secretary, by notice in writing, to require a licence holder to provide information within a specified period if the information is to be used by the Secretary in deciding whether or not to revoke or suspend a licence under the fit and proper person test in section 41 (item 9 refers).  Item 8 also adds new subsection 40(7) providing that the specified period under new subsection 40(6) must be at least 14 days.

 

Items 9 and 10

These items amends subsection 41(1), which allows the Secretary to revoke or suspend a manufacturing licence in certain circumstances, to incorporate the new fit and proper person test incorporated in new paragraph 38(1)(g) (item 2 refers). 

 

Item 9 amends the subsection to allow the Secretary to revoke or suspend a manufacturing licence if:

  • the licence holder (subparagraph 41(1)(a)(i)),
  • a manager (being a person who makes, or participates in making, decisions that affect the whole, or a substantial part, of the holder’s affairs) (subparagraph (ii)), or
  • a major interest holder in the licence holder (subparagraph (iii))

has, in the past ten years:

  • been convicted of offences against therapeutic goods legislation or offences involving fraud or dishonesty (subparagraphs (iv) and (v)), or
  • been required to pay a pecuniary penalty for contravention of civil penalty provisions under such laws (subparagraphs (vi) and (vii), or
  • breached a condition of a manufacturing licence or held a licence which was suspended or revoked (subparagraphs (viii) and (ix), or
  • been a manager or a major interest holder in a body corporate which had met the tests in subparagraphs (iv) to (ix) (subparagraph (x)).

 

Item 10 allows regulations to be made under new paragraph 41(1)(h) to add other circumstances that the Secretary must take into account in reaching a decision on revoking or suspending a manufacturing licence.  The intention of this provision is to allow the Government - subject to Parliamentary scrutiny - to act to address emergent circumstances by expanding the range of matters the Secretary must consider in making a decision to revoke or suspend a licence.  Such matters may not necessarily be related to the fitness and propriety of a licence holder, but could relate to other as yet unknown criteria which might affect the need to revoke or suspend a licence.

 

Existing paragraphs 41(1)(d) to (g) setting out other grounds for revocation or suspension are not affected by the amendment.



Item 11

This item repeals subsection 41(1A) as a consequence of the new fit and proper person test (item 9 refers), and replaces it with a new subsection (1A) providing that a reference to a person convicted of an offence in new paragraph 41(1)(a) includes a reference to a person who has been discharged without a conviction after an offence has been proved under section 19B of the Crimes Act 1914 , or equivalent State or Territory legislation.

 

The item also adds new subsections 41(1B) and (1C).  New subsection 41(1B) provides that the regulation making power under new paragraph 41(1)(h) is not limited by the matters set out in new paragraph 41(1)(a).  New subsection 41(1C) defines a “manufacturing licence” for the purposes of new paragraph 41(1)(a).

 

Item 12

This item inserts a new section 41AA providing that sections 40 and 41 do not override the operation of the spent conviction scheme set out in Part VIIC of the Crime Act 1914 .

 

Item 13

This item amends section 41EC dealing with consideration of applications for a conformity assessment certificate for a medical device.  Subsection 41EC(3) currently requires the Secretary, in deciding whether to issue a certificate, to consider whether the applicant, or a person participating in managing the applicant’s affairs, or a person who has effective control over the applicant, is a fit and proper person within the meaning of subsection 41EC(4).

 

The item replaces subsection 41EC(3) with a new subsection (3) requiring the Secretary to consider whether:

  • the applicant (subparagraph 41EC(3)(a)(i)),
  • a manager (being a person who makes, or participates in making, decisions that affect the whole, or a substantial part, of the applicant’s affairs) (subparagraph (ii), or
  • a major interest holder (subparagraph (iii))

has, in the past ten years:

  • been convicted of offences against therapeutic goods legislation or offences involving fraud or dishonesty (subparagraphs (iv) and (v)), or
  • been required to pay a pecuniary penalty for contravention of civil penalty provisions under such laws (subparagraphs (vi) and (vii)), or
  • breached a condition of a conformity assessment certificate or held a certificate which was suspended or revoked (subparagraphs (viii) and (ix), or
  • been a manager or a major interest holder in a body corporate which had met the tests in subparagraphs (iv) to (ix) (subparagraph (x)).

 

The provision also allows regulations to be made under new paragraph 41EC(3)(b) to add other circumstances that the Secretary must take into account in reaching a decision on granting a conformity assessment certificate.  The intention of this provision is to allow the Government - subject to Parliamentary scrutiny - to act to address emergent circumstances by expanding the range of matters the Secretary must consider in making a decision to grant a certificate.  Such matters may not necessarily be related to the fitness and propriety of an applicant, but could relate to other as yet unknown criteria which might affect the desirability of issuing a certificate.

 



Item 14

This item repeals subsection 41EC(4) as a consequence of the new fit and proper person test (item 13), and replaces it with a new subsection (4) providing that a reference to a person convicted of an offence in new paragraph 41EC(3)(a) includes a reference to person who has been discharged without a conviction after an offence has been proved under section 19B of the Crimes Act 1914 , or equivalent State or Territory legislation.

 

It also adds a new subsection 41EC(5) providing that the regulation-making power under new paragraph 41EC(3)(b) is not limited by the matters set out in new paragraph 41EC(3)(a).

 

Item 15

This item amends paragraph 41EG(c) to remove the words “relating to a kind of medical device to which the application relates”.  As a result the provision now provides that an application for a conformity assessment certificate for a medical device lapses if the applicant fails to comply with a notice from the Secretary seeking any information under new section 41JA within ten days of the specified day, rather than information relating to a medical device.  (Item 21 amends section 41JA to include an information gathering provision relating to applications for conformity assessment certificates.)

 

Item 16

This item amends section 41EJ to add a new subsection 41EJ(5A) subjecting a conformity assessment certificate to any conditions specified in the regulations.

 

Item 17

This item amends paragraph 41ET(1)(c) to provide that the Secretary may revoke a conformity assessment certificate if the person holding the certificate fails to comply with a notice from the Secretary seeking any information under new section 41JA within ten days of the specified day.

 

Item 18

This item replaces paragraphs 41ET(1)(e) to (g), which currently allow the Secretary to revoke a conformity assessment certificate if the holder, or a person participating in managing the holder’s affairs, or a person who has effective control over the holder, is not a fit and proper person within the meaning of subsection 41EC(4).

 

Under the new paragraph 41ET(1)(e) the Secretary may revoke a conformity assessment certificate if:

  • the holder (subparagraph 41ET(1)(e)(i)),
  • a manager (being a person who makes, or participates in making, decisions that affect the whole, or a substantial part, of the holder’s affairs (subparagraph (ii)), or
  • a major interest holder (subparagraph(iii))

has, in the past ten years:

  • been convicted of offences against therapeutic goods legislation or offences involving fraud or dishonesty (subparagraphs 41ET(1)(e)(iv) and (v)), or
  • been required to pay a pecuniary penalty for contravention of civil penalty provisions under such laws (subparagraphs (vi) and (vii)), or
  • breached a condition of a conformity assessment certificate or held a certificate which was suspended or revoked (subparagraphs (viii) and (ix)), or
  • been a person participating in managing the affairs or a major interest holder in a body corporate which had met the tests in subparagraphs (iv) to (ix) (subparagraph (x)).


The provision also allows regulations to be made under new subparagraph 41ET(1)(f) to add other circumstances that the Secretary may take into account in reaching a decision on revoking a conformity assessment certificate.  The intention of this provision is to allow the Government - subject to Parliamentary scrutiny - to act to address emergent circumstances by expanding the range of matters the Secretary must consider in making a decision to revoke a certificate.  Such matters may not necessarily be related to the fitness and propriety of a certificate holder, but could relate to other as yet unknown criteria which might affect the need to revoke a certificate.

 

Item 19

This item repeals subsection 41ET(1A) as a consequence of the new fit and proper person test (item 18 refers), and replaces it with a new subsection (1A) providing that a reference to a person convicted of an offence in new paragraph 41ET(1)(e) includes a reference to person who has been discharged without a conviction after an offence has been proved under section 19B of the Crimes Act 1914 , or equivalent State or Territory legislation.

 

It also adds a new subsection 41ET(1B) providing that the regulation-making power under new paragraph 41ET(1)(f) is not limited by the matters set out in new paragraph 41ET(1)(e).

 

Item 20

This item inserts a new subsection 41ET(4) providing that nothing in section 41ET overrides the operation of the spent conviction scheme set out in Part VIIC of the Crime Act 1914 .

 

Items 21 and 22

These items amends section 41JA to add five new subsections. 

 

Item 21 adds:

  • new subsection 41JA(1A) empowering the Secretary, by written notice, to seek specified information from a person who is an applicant for a conformity assessment certificate;
  • new subsection 41JA(1B) providing that the same notice may be used for the purposes of subsection (1) and new subsection (1A);
  • new subsection 41JA(1C) empowering the Secretary, by written notice, to seek specified information from a person who holds a conformity assessment certificate if the information is to be used in deciding whether to suspend or revoke a certificate in the circumstances set out in new paragraph 41ET(1)(e) (item 18 refers); and
  • new subsection 41JA(1D) providing that the same notice may be used for the purposes of subsection (1) and new subsection (1C).

 

Item 22 adds new subsection (3) providing that nothing in the section overrides the operation of the spent conviction scheme set out in Part VIIC of the Crime Act 1914 .

 

Item 23

This item sets out the application of the amendments made by this Schedule to sections 38, 40, 41, 41EC, 41EG, 41EJ, 41ET, and 41JA.

 

It provides that the amendments to section 38 apply to licences applied for on or after the commencement of this item (a day to be proclaimed but no later than six months after Royal Assent), and amendments to sections 40 and 41 apply in relation to licences granted at any time.

 

The amendments to sections 41EC and 41EG and subsection 41JA(1A) apply to applications for conformity assessment certificates, notices, and applications for conformity assessment certificates, respectively, made on or after the commencement of this item.

 

The amendments to sections 41EJ, 41ET, and subsection 41JA(1C) apply to conformity assessment certificates issued at any time.

 

 



SCHEDULE 4 - ADDITIONAL DEFAULT STANDARDS

 

The Act currently establishes the British Pharmacopoeia as the “default standard” to which therapeutic products must conform, unless another standard has been determined by the Minister for Health and Ageing.  This Schedule provides that the European Pharmacopoeia and United States Pharmacopeia are included as alternative default standards.

 

Item 1

This item amends the definition of “British Pharmacopoeia” in subsection 3(1).  The amended definition refers to a “publication” rather than a “book”, recognising the move towards electronic publication for many reference texts.  It also changes the date of effect from that notified by the Minister in the Gazette , to the effective date notified in the publication.  This means that manufacturers of therapeutic goods will be able to adopt the British Pharmacopoeia for products intended for the Australian market from the time it comes into effect in the United Kingdom, without having to wait for determination and gazettal by the Minister.

 

Item 2

This item removes the definition of “British Pharmacopoeia (Veterinary)” from subsection 3(1).  As the Act does not regulate therapeutic goods for veterinary use the definition is redundant.

 

Item 3

This item adds a definition of “default standard” to subsection 3(1), effectively providing that the British Pharmacopoeia, European Pharmacopoeia and United States Pharmacopeia - National Formulary are default standards.

 

Item 4

This item adds a definition of “European Pharmacopoeia” to subsection 3(1).  The date of effect is stated to be the effective date notified in the publication.  This means that manufacturers of therapeutic goods will be able to adopt the European Pharmacopoeia for products intended for the Australian market at the time it will be adopted by some European countries.

 

Item 5

This item amends the definition of “medicine” in subsection 3(1) to remove a reference to animal use.  As the Act does not regulate therapeutic goods for veterinary use the reference is redundant.

 

Items 6

This item replaces the current definition of a “standard” in subsection 3(1). 

 

The new definition states that a “standard” is constituted by matters specified by the Minister in an order under section 10, and, if the goods are the subject of a monograph in the British Pharmacopoeia, the European Pharmacopoeia or the United States Pharmacopeia - National Formulary, is constituted by the statements in those monographs, as interpreted by the general notices section in those pharmacopoeias.  However, so much of those monographs or statements as are exempted by the Minister under proposed new section 3C (item 12 refers) are not part of a standard.

 

The definition is followed by a note referring to section 13, which also deals with standards.



Items 7 to 9

These items remove references to animals in the definitions of “supply” and “therapeutic use” in subsection 3(1).  As the Act does not regulate therapeutic goods for veterinary use the references are redundant.

 

Item 10

This item adds a definition of “United States Pharmacopeia - National Formulary” to subsection 3(1).  The date of effect is stated to be the effective date notified in the publication.  This means that manufacturers of therapeutic goods will be able to adopt the United States Pharmacopeia for products intended for the Australian market from the time it comes into effect in the United States.

 

Item 11

This item repeals subsection 3(2) which dealt with deciding if therapeutic goods are for use in animals or humans, and replaces it with a new subsection (2) providing that therapeutic goods are to be taken to be for use in humans if they are not solely for use in animals.  As the Act does not regulate therapeutic goods for veterinary use the current provision is redundant.

 

Item 12

This item adds a new section 3C to empower the Minister, by legislative instrument, to determine that monographs or parts of monographs in the British Pharmacopoeia, European Pharmacopoeia or the United States Pharmacopeia - National Formulary are exempt monographs or statements and do not form a “standard” as defined in subsection 3(1) (item 6 refers).

 

Items 13 and 14

These items amend section 10 dealing with the determination of standards by the Minister to add references to the European Pharmacopoeia and the United States Pharmacopeia - National Formulary to provisions referring to the British Pharmacopoeia, and remove references to the British Pharmacopoeia (Veterinary).

 

Item 15

This item repeals section 13 and replaces it with a new section 13 dealing with the application of standards.

 

Subsection (1)) provides that if a statement in a monograph in a pharmacopoeia refers to a statement in a monograph in another publication, that second statement is incorporated into the statement in the pharmacopoeia.

 

Subsection (2) provides that if a standard determined by the Minister under section 10 and a default standard both apply to therapeutic goods and are inconsistent, the section 10 standard prevails to the extent of the inconsistency.

 

Subsections (3) and (4) deal with cases where two or more default standards (as defined in subsection 3(1) (item 3 refers)) apply to therapeutic goods.  Subsection (3) provides that a default standard applying to some of the goods within a class of goods applies to the exclusion of a standard applying to the class of goods, where those standards are inconsistent.  Subsection (4) provides that a default standard applying to goods that are a mixture of ingredients or a combination of component parts applies to the exclusion of a standard applying to the individual ingredients or component parts.

 

Subsection (5) is equivalent to existing subsection (7).  It provides that if:

  • therapeutic goods are a mixture of ingredients or a combination of component parts; and
  • there is not a standard that applies to the mixture of combination but there is a standard applying to some of the individual ingredients or component parts

the Minister may make an order published in the Gazette determining that the standard does not apply to the goods.  

 

Subsection (6) states for the benefit of readers that the order under subsection (5) is not a legislative instrument.  As the exemption is not a legislative instrument within the meaning of the Legislative Instruments Act 2003 , it is not subject to requirements of that Act such as registration or Parliamentary scrutiny.  This subsection explains rather than creates the exemption.

 

Subsection (7) provides that if (after applying subsections (2) to (5)) more than one default standards applies to therapeutic goods, and the goods conform to one of those standards, then the standards to which the goods do not conform are taken not to apply.  This provision ensures that persons cannot be prosecuted under section 14 or be subject to civil proceedings for a contravention of section 14A for importing, supplying or exporting goods that do not conform to a standard if they conform to one of those standards.

 

Items 16 and 18

These items amend subsections 30F(2) and 42V(3) to remove redundant references to animals.

 

Item 17

This item amends section 41CC to change a reference to the “United States Pharmacopoeia” to the “United States Pharmacopeia - National Formulary” to reflect the full name of the publication. 

 

Item 19

This item amends section 56 dealing with judicial notice of pharmacopoeias to add references to the European Pharmacopoeia and the United States Pharmacopeia - National Formulary, and remove a reference to the British Pharmacopoeia (Veterinary).

 

Item 20

This item provides that if therapeutic goods were registered or listed before the commencement of this item (1 July 2009), and as a result of amendments made by this Schedule would be required within twelve months of commencement to conform to the European Pharmacopoeia or the United States Pharmacopeia - National Formulary, those standards are taken not to apply to those goods during that period.

 

For the avoidance of doubt, it provides that paragraph (a) of the new definition of “standard” (item 6 refers) applies to orders made by the Minister under section 10 before or after the commencement of this item.

 

It also provides that an order made under the repealed subsection 13(7) (item 15 refers) continues in force after commencement as if it were made under the new subsection 13(5).

 



SCHEDULE 5 - INFORMATION DISCLOSURE PROVISIONS

 

The Act prescribes types of information that can be released and the persons to whom such information can be released.  This Schedule gives effect to the Government’s commitment to provide public access to a much wider range of information held by the Therapeutic Goods Administration.

 

Item 1

This item amends subsection 9C(1) to remove any implication that entries on the ARTG cannot be made available to the public.  While neither this amendment, nor anything else in the Act, confers a right to public inspection of the ARTG, the Government intends that much greater access to the ARTG be made available through the new subsections 61(5C) and (5D) (item 14 refers).

 

Item 2

This item amends the definition of “therapeutic goods information” in subsection 61(1) to refer to information “held by the Department” rather than information that “came into the possession of the Department”.  This is to ensure that the definition includes information generated by the Department in performing its function under the Act as well as material provided to it.

 

Item 3

This item provides that the amended definition of “therapeutic goods information” (item 2 refers) applies to all information held by the Department on or after the commencement of this item (the day after Royal Assent), regardless of when it was created.

 

Items 4 to 8 and 12

These items remove various references to the “Director-General” or the “head” of various bodies.  As a result the Secretary will now be able to release information to those bodies, rather than to the individual person occupying the position of Director-General or head.  The current formulation has led to administrative difficulties in supplying information to other regulatory agencies if the head of those agencies has been hard to contact.

 

Items 9 to 11

Subsection 61(4A) lists information the Secretary can release to various agencies with a therapeutic goods, health or law enforcement function.  Item 9 adds to that list recall action taken under section 30EA, and items 10 and 11 add to the list contraventions of Part 5-2 involving counterfeiting and information about cases or possible cases of counterfeit goods.

 

Item 13

This item inserts new subsections 61(5AA) and (5AB).  New subsection (5AA) allows the Secretary to release to a person, body or authority therapeutic goods information of a kind specified by the Minister under new subsection (5AB) for a purpose specified by the Minister.

 

New subsection (5AB) empowers the Minister, by legislative instrument, to specify persons, bodies or authorities (or classes of persons, bodies or authorities), kinds of information and purposes for the purpose of new subsection (5AA).

 

These provisions will allow greater flexibility in the release of a wider range of information to a wider range of bodies than is permitted under the current section 61. 

 

Item 14

This item amends section 61 to add new subsections (5C) and (5D).  Under new subsection (5C), the Secretary may release to the public therapeutic goods information of a kind specified by the Minister under new subsection (5D).  

 

New subsection (5D) empowers the Minister, by legislative instrument, to specify kinds of information for the purpose of new subsection (5AC).

 

These provisions will support the public release of information such as details of entries on the ARTG, summaries of evaluations of applications to register new therapeutic goods and the records of advisory committees established under the Act.

 

Items 15 and 16

These items amend subsection 61(6A) to correct an inconsistency with subsection (6), which refers to the release of information to a person on application, of therapeutic goods information identified in regulations.  Paragraph 61(6A)(c) which provides that the regulations may authorise the release of information “on application or otherwise” is repealed.

 

Item 17

This item adds a new subsection 61(12), clarifying that the provisions of section 61 authorising the release of information operate independently of each other.

 

 



SCHEDULE 6 - ADVERTISING

 

The Act currently regulates advertisements of therapeutic goods.  It requires pre-approval of advertisements in “mainstream” media but not other media, and bans or limits the use of some representations in advertisements for therapeutic goods.  This Schedule clarifies the different kinds of advertisements to which these provisions apply.

 

Item 1

This item amends 42AC(2) by replacing the reference to section 42DC with a reference to new section 42DKB (item 9 refers).

 

Item 2

This item amends the definition of “restricted representation” in section 42B as a consequence of the amendment to section 42DD (items 5 and 6 refer).

 

Item 3

This item replaces section 42DA which describes the application of Division 3 of Part 5-1.  New section 42DA explains that Part 2 of the regulations deals with the approval of advertisements and refers to Division 3, and that offences in Division 3A refer to provisions in Division 3.

 

Item 4

This item repeals section 42DC, which will be replaced by new section 42DKB added by item 9 of this Schedule.

 

Items 5 to 8

Items 5, 6 and 8 operate to repeal subsection 42DD(2).  The subsection is redundant as the conduct it forbids is an offence under subsection 42DL(1). 

 

Item 7 adds a note at the foot of the section to explain that it is an offence under subsection 42DL(1) to use restricted representations that have not been approved or permitted under various provisions of Division 3.

 

Item 9

This item creates a new Division 3A in Part 5-1.  The new Division will contain the existing sections 42DL and 42DM, which create general offences for publishing or broadcasting advertisements that contravene the Act and advertisements that do not comply with the Therapeutic Goods Advertising Code. 

 

The item adds a new section 42DKA which explains that the Division applies to advertisements for therapeutic goods other than those which are required to be approved under the regulations. 

 

It also adds a new section 42DKB replacing the former section 42DC (item 4 refers). 

 

Subsection (1) empowers the Secretary to give a notice to a person apparently responsible for publishing or broadcasting an advertisement containing a false or misleading advertisement about therapeutic goods.  The notice will prevent that person from publishing or broadcasting an advertisement containing that representation about those goods. 

 

Subsection (2) states for the benefit of readers that the notice in subsection (1) is not a legislative instrument.  As the notice is not a legislative instrument within the meaning of the Legislative Instruments Act 2003 , it is not subject to requirements of that Act such as registration or Parliamentary scrutiny.  The subsection explains rather than creates the exemption.

 

Items 10 and 11

These items amend section 42DL to replace references to section 42DC with references to the new section 42DKB (item 9 refers).  They also remove the offence of publishing or broadcasting an advertisement in contravention of a notice under section 42DK.  This is because such a notice permits certain publications, but does not impose an obligation on any person.

 

Item 12

This item provides that notices in force under section 42DC before the commencement of the item (the date after Royal Assent) continue to have effect as if they were issued under new section 42DKB (item 9 refers), and regulations made under subsection 42DD(1) continue as if they were made under section 42DD (items 5 to 8 refer).

 

 



SCHEDULE 7 - OTHER AMENDMENTS

 

The amendments in this Schedule remove the reference to maximum penalty at the foot of offence sections under the Act as they are redundant in view of the operation of subsection 4B(3A) of the Crimes Act 1914 .

 

Item 1

This item repeals subsection 3(8), which presently provides that where the words “maximum penalty” appear at the bottom of an offence provision, a person convicted of the offence is punishable by a penalty up to the maximum.

 

Items 2 to 11

These items amend offence provisions in sections 8, 14, 15, 19B, 20, 21, 21A, 22, 22A and 26B to replace the words “maximum penalty” with the word “penalty”.

 

Items 12 and 13

These items remove the penalty provision from the foot of subsection 26C(5), and insert a new subsection (5A) providing that the maximum pecuniary penalty that can be ordered by a court under subsection 26C(5) is $10 million.

 

Items 14 to 37

These items amend offence provisions in sections 29A, 29B, 30EC, 30F, 30H, 31, 31C, 31D, 31E, 35, 35B, 41EI, 41FE, 41JB, 41JG, 41JH, 41JI, 41KC, 41MA, 41MC, 41ME, 41MF, 41MH, 41MI and 41MK to replace the words “maximum penalty” with the word “penalty”.

 

Item 38

This item extirpates a stray subsection number at the front of section 41ML.

 

Items 39 to 53

These items amend offence provisions in sections  41ML, 41MM, 41MN, 41MO, 41MP, 41MQ, 42E, 42T, 42V, 42W, 42YE, 48, 51B, 52 and 54AB to replace the words “maximum penalty” with the word “penalty”.