Bills Digest no. 47 2005–06
Therapeutic Goods Amendment Bill (No. 2)
2005
WARNING:
This Digest was prepared for debate. It reflects the legislation as
introduced and does not canvass subsequent amendments. This Digest
does not have any official legal status. Other sources should be
consulted to determine the subsequent official status of the
Bill.
CONTENTS
Passage History
Purpose
Background
Main Provisions
Concluding Comments
Endnotes
Contact Officer & Copyright Details
Passage History
Therapeutic Goods
Amendment Bill (No. 2)
2005
Date
Introduced: 14 September 2005
House: House of
Representatives
Portfolio: Health and Ageing
Commencement: Sections 1 to 3, the day on which
this Act receives the Royal Assent; Schedule 1, a day to be fixed
by Proclamation. If any of the provisions do not commence within 6
months after Royal Assent, the first day after the end of that
period.
The Therapeutic Goods Amendment Bill (No. 2) 2005 (the Bill)
amends the Therapeutic Goods Act 1989 (the Act) by
creating an exemption to the current certification requirements for
registering or listing therapeutic goods in the Australian Register
of Therapeutic Goods (ARTG).
As of 1 January 2005, all applicants seeking to register or list
a product in the ARTG,(1) have been required to provide
section 26B(1) certificates. A 26B(1) certificate declares that
applicants will:
- not enter the market in a manner that would infringe a patent
on the product; or,
- if they intend to enter the market before the expiry of any
applicable patent, that they have notified the patent owner of
their intention to do so.
This requirement was introduced in order to comply with Article
17.10.4 of the Australia-United States Free Trade Agreement (FTA)
which relevantly provides:
Where a Party permits, as a condition of approving
the marketing of a pharmaceutical product, persons, other than the
person originally submitting the safety or efficacy information, to
rely on evidence or information concerning the safety or efficacy
of a product that was previously approved, such as evidence of
prior marketing approval by the Party or in another territory:
(a) that Party shall provide measures in its
marketing approval process to prevent those other persons from:
(i) marketing a product, where that product is
claimed in a patent; or
(ii) marketing a product for an approved use,
where that approved use is claimed in a patent,
during the term of that patent, unless by consent
or acquiescence of the patent owner; and
(b) if the Party permits a third person to request
marketing approval to enter the market with:
(i) a product during the term of a patent
identified as claiming the product; or
(ii) a product for an approved use, during the
term of a patent identified as claiming that approved use,
the Party shall provide for the patent owner to be
notified of such request and the identity of any such other
person.(2)
The main purpose of this Article was to prevent manufacturers of
a generic version of a patented product from entering the market
before the expiry of the patent covering that product. However, the
Australian section 26B(1) certification requirement applies to
all applicants, not only those wanting to market a generic
product; and, as applicants may have to undertake expensive global
patent searches and obtain legal advice in relation to the results
of any search, this is considered unnecessarily bureaucratic and
burdensome on industry.
To address this criticism, the Bill restricts the certification
requirement to only certain applicants:
- those required to submit safety and efficacy data when making
their application, and
- who, when making their application, rely on data previously
submitted to the Therapeutic Goods Administration by another person
in relation to an approved product.
All other applicants may provide a notice to the Secretary of
the Department of Health and Ageing (Secretary) that a section
26B(1) certificate is not required.
The effect of the amendment is that the sponsors of generic
medicines will still have to provide a certificate but the majority
of complementary medicines, which rely on readily accessible data,
and most originator medicines, which submit their own safety and
efficacy data, will no longer be subject to the certification
requirements and a notice will be sufficient.(3)
The exemption will also cover the majority of over-the-counter
medicines such as sunscreens and throat lozenges(4) as
these contain active ingredients of which there is adequate
knowledge available in the public domain. As low risk therapeutic
goods, the Act does not require the sponsors of such goods to
submit safety or efficacy data on the product.(5)
Therefore a notice will be sufficient for these products.
For prescription medicines which are considered high risk
registrable therapeutic goods, sponsors are required to submit both
safety and efficacy data. As a result of the amendment, a
certificate would only need to be provided if relying on safety or
efficacy data previously submitted by another person.
The Bill and the FTA
Parliamentary Secretary for Health, Christopher Pyne MP, has
described the Bill as simply correcting an unintended drafting
error (6) that adds considerable cost to the
registration and listing process. However, as the change is related
to a provision of the FTA, it may have wider repercussions.
For example, while some companies welcome the Government s
initiative because it will reduce their costs, it has been reported
that industry sources are critical of the Government s quiet
approach to introducing the amendments for fear that other industry
groups would lobby the government to make changes to the FTA.
(7)
Also, potential exists for the United States to challenge the
legislation if it believes the amendments breach the FTA. It may do
so under the Chapter 21 provisions which provide for dispute
settlement by consultation (Article 21.5) or panel review (Article
21.7).
Mr Pyne reportedly disputed that this would occur because the
Australian legislation at present covered a far broader group of
products than United States legislation and the amendments, in
rectifying this anomaly, would not warrant United States
approval.(8)
A reading of the relevant provisions in the United States
Federal Food, Drug and Cosmetic Act does suggest
that the U.S. legislation is more narrowly focused than its
Australian equivalent. It requires similar certification but only
in those circumstances where an applicant relies on safety and
efficacy investigations which were not conducted by or for the
applicant and for which the applicant has not obtained a right of
reference or use from the person by or for whom the investigations
were conducted.(9) It is therefore unlikely that the
United States would challenge the proposed amendments as they
essentially mirrors the U.S. legislation.
More importantly, the Bill also appears to be consistent with
the FTA as the measures proposed in Article 17.10.4 are directed at
the marketing approval process for pharmaceutical products that
rely on evidence or information concerning the safety or efficacy
of a product that was previously approved .
Schedule 1, Item 1 repeals the current
paragraph 25(4)(d) and replaces it with a provision allowing
applicants seeking to register therapeutic goods to provide
either:
- a notification that a subsection 26B(1) certificate is not
required for the purposes of registration; or
- a subsection 26B(1) certificate.
After the Secretary has notified the applicant
that the therapeutic goods are eligible for registration and the
goods will be included in the ARTG, either of these (a notice or
certificate) must be provided to the Secretary.
Item 2 clarifies that once a
notice or certificate is provided to the Secretary by an applicant,
the Secretary must include the goods in the Register without
inquiring into the correctness of the certificate or the
notice.
Items 3 and 7 provide that civil
proceedings cannot be bought against the Secretary where the
Secretary includes or lists respectively, therapeutic goods in the
ARTG in reliance upon a notice (as is the case with a
certificate).
Items 8, 9, and
10 make similar amendments to the above to effect
the introduction of 26B(1) notices with respect to the approval
process for including listable medicines in the ARTG.
Item 11 provides that civil
proceedings cannot be bought against the Secretary where the
Secretary lists a medicine in the ARTG in reliance upon a
notice.
Item 12 inserts the new
subsection 26B(1A). Under this new provision, a certificate is
required under 26B(1) only if the applicant is required:
- to submit evidence or information to establish the safety or
efficacy of the goods as part of the registration process or
listing; and
- in order to satisfy that requirement, the applicant relies to
any extent, on evidence or information that another person
submitted to the Secretary to establish the safety or efficacy of
other therapeutic goods that have already been registered or
listed, and this was done as part of the process of applying for
registration or listing of those goods.
Item 14 inserts a new section
26BA as to the approved form for notices.
Item 15 provides that the
amendments in the Bill apply to applications for registration or
listing of therapeutic goods that are made on or after the day on
which Schedule 1 commences.
The Bill, in narrowing the category of applicants to whom the
certification requirements apply, should achieve its purpose of
making the registration process less onerous for the majority of
applicants.
It is unlikely, especially in light of the comparable U.S.
legislation, that the amendments breach the FTA.
- Except those seeking to register or list therapeutic and
medical devices.
- http://www.dfat.gov.au/trade/negotiations/us_fta/final-text/index.html
- Explanatory Memorandum, p.
1.
- The Hon. Chris Pyne, MP, House of Representatives,
Debates, 14 September 2005, p. 2.
- The ARTG is divided into two parts: registered goods which are
evaluated for quality, safety and efficacy; and listed goods, such
as vitamins and herbal medicines, which are not evaluated for
efficacy and assumed to be safe. See Therapeutic Goods Act
1989 (Cth) Pt 3, and Therapeutic Goods Regulations (Cth), regs
10-12, 15.
- Quoted by Lisa Allen,
Free-trade drafting error fixed , Australian Financial
Review, 20 September 2005, p. 5.
- Ibid.
- Ibid.
- See Federal Food, Drug and Cosmetic Act (US) [21
U.S.C. 321], Sec. 201 for the definition of the term drug available
at: http://www.fda.gov/opacom/laws/fdcact/fdcact1.htm.
See Sec. 505 [21 U.S.C. 355] for the application approval
process for new drugs, specifically subsection (2)(A) which
provides that applications relying on safety and efficacy
investigations which were not conducted by or for the applicant and
for which the applicant has not obtained a right of reference or
use from those who did conduct the investigations, must include
certification that, in the opinion of the applicant and to the best
of his knowledge, that a patent to which those investigations
relate, if not filed or expired, is invalid or will not be
infringed. The applicant must give notice to the patent owner whose
patent is allegedly not infringed or not valid, and in that notice
provide details of the patent application sought and the factual
and legal basis for alleging invalidity or non-infringement.
Available at: http://www.fda.gov/opacom/laws/fdcact/fdcact5a.htm
Katrina Gunn
7 October 2005
Bills Digest Service
Information and Research Services
This paper has been prepared to support the work of the
Australian Parliament using information available at the time of
production. The views expressed do not reflect an official position
of the Information and Research Service, nor do they constitute
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ISSN 1328-8091
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