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Proposal to change the current Good Manufacturing Practice (GMP) fees and charges

9 February 2018

This TGA behind-the-news article was published on 9 February 2018. Behind-the-news articles are published in response to issues that are of interest to the community at a point in time, for example, subjects that have been in the media.

In response to the recent article from Pharma in Focus, the Therapeutic Goods Administration (TGA) provides the following clarification.

The TGA operates on a fully cost-recovery basis. It is important to maintain fees and charges current and reflecting the larger number of applications received each year and their complexity.

The TGA engaged Deloitte to undertake a review of its current Good Manufacturing Practice (GMP) fees and charges for medicines and Active Pharmaceutical Ingredients (APIs).

The purpose of the review was to improve the accuracy and transparency of the cost recovery arrangements for that regulatory function and address a significant under recovery over the past four financial years.

The review has been discussed in face to face meetings with peak industry bodies in late 2017.

As part of the review, the TGA provided comprehensive activity-based cost data on its regulatory activities as well as de-identified data on the fees and charges currently levied on medicines manufacturers and sponsors.

Deloitte analysed data across four financial years and built costing models to help identify key issues. The review of Medicines GMP cost recovery was conducted in accordance with relevant requirements of the Therapeutic Goods Act 1989 (the Act) and Cost Recovery Guidelines (RMG 302).

Deloitte has also examined the fees and charges levied by the TGA's international counterparts for comparable functions.

The selection of one option as preferred has been made by Deloitte on the grounds that this option encourages a higher level of compliance by manufacturers and sponsors in order to reduce regulatory fees and charges and addresses all major areas of under recovery.

The TGA is conducting a consultation to seek feedback from the potentially impacted stakeholders (ie: companies within the medicinal product pharmaceutical industry).

The TGA is also consulting on transitional arrangements.