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Cost recovery impact statement: Good manufacturing practice, 1 July 2014 - 30 June 2015

Version 1.0, June 2014

26 June 2014

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1. Introduction

1.1. Purpose of the Cost Recovery Impact Statement (CRIS)

The CRIS provides key information on how the TGA implements cost recovery of activities associated with the manufacture of medicines. TGA regulates manufacturers through application of Good Manufacturing Practice (GMP) principles. It also reports on financial and non-financial performance of GMP activities and contains up-to-date financial forecasts. The TGA will maintain the CRIS until the activity or its cost recovery has been discontinued.

This CRIS will apply from July 2014 to June 2015.

1.2. Description of the activity

The TGA forms a part of the Department of Health, responsible for evaluating the safety, quality and efficacy of medicines, medical devices and biologicals available for supply in, or export from Australia. The TGA recovers the full costs of its regulatory activities through fees and charges imposed on sponsors and manufacturers of therapeutic products.

The Australian community has an expectation that therapeutic products in the marketplace are safe and of high quality, to a level equal to that of countries with comparable standards.

In Australia, manufacturers of therapeutic goods are required to hold a licence. To obtain the licence, a manufacturer must demonstrate that they have the ability to comply with manufacturing principles, which include relevant Codes of GMP and Quality Systems, and have appropriate facilities to manufacture safely. Overseas manufacturers of therapeutic goods suppled to Australia must provide evidence of compliance with equivalent GMP standards or otherwise undergo on-site inspections in the same manner as manufacturers based in Australia.

GMP is a generally accepted term internationally to describe a set of principles and procedures that, when followed by manufacturers of medicines, helps insure that the products manufactured will possess the required quality.

1.3. Australian Government cost recovery framework

Cost recovery involves the government entities charging individuals or non-government organisations some or all of the efficient costs of a specific government activity. This may include goods, services or regulation, or a combination of these. The Australian Government Cost Recovery Guidelines (CRG) set out the overarching framework under which government entities design, implement and review cost recovered activities.

1.4. Policy and statutory authority to cost recover

1.4.1. Government policy approval to cost recover the activity

In the 1997-98 Budget1, the Government decided to cost recover 100 percent of all TGA's activities by 1998-99. This policy authority encompasses recovering expenses incurred by the TGA in the regulation of therapeutic medicines manufacture.

1.4.2. Statutory authority to impose cost recovery charges

The Therapeutic Goods Act 1989 (the Act) provides a legal authority for the TGA to charge for its regulatory activities within the scope of the Act on a cost recovery basis. Applicable fees and charges are prescribed in regulations made under the Act and the Therapeutic Goods (Charges) Act 1989 (the Charges Act). These regulations are included in the Therapeutic Goods (Charges) Regulations 1990 and the Therapeutic Goods Regulations 1990.

Footnote

  1. 1997-98 Budget Paper 2, Revenue Measures, Other Measures p 203.

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