Notes accompanying summary of fees and charges at 1 July 2008
Explanation for increases in fees and charges
The TGA recovers the full cost of its regulatory activities through fees and charges from industry. Each year, the level of fees and charges is reviewed in consultation with industry associations, whilst significant changes to regulatory arrangements for new regulatory proposals involve additional consultation with affected sectors and result in the preparation of cost recovery impact statements.
For the 2008-2009, the TGA consulted with Medicines Australia, the Generic Medicines Industry Association, the Australian Self-Medication Industry, the Complementary Healthcare Council, the Medical Industry Association of Australia, the Australian Dental Industry Association, and AusBiotech Ltd.
General fee increase
The TGA consulted with industry associations in February 2008 seeking consideration for a general increase to fees and charges in line with wage and price movements for the regulation of therapeutic goods and medical devices, the maintenance of manufacturing licences, and the low turnover threshold for a reduction of the annual charge for a licence to manufacture therapeutic goods.
An indexation model previously agreed with industry forms the basis for proposals for annual fee adjustments, and comprises a 50/50 composite of the Australian Bureau of Statistics' Wage Cost Index (WCI) and Consumer Price Index (CPI).
The composite index for 2008-2009 is 3.6 per cent.
Exceptions - Non prescription (registered) medicines
In developing the 2008-09 TGA operating budget, it was identified that fees and charges in the non-prescription (registered) medicines sector would not achieve full cost recovery, consequently:
- Non prescription (registered) medicines application and evaluation fees, and annual charges will increase by to move the sector towards full cost recovery.
- As the increases exceed the agreed index they represent a material amendment of an existing cost recovery arrangement. Accordingly, a cost recovery impact statement (CRIS) has been prepared and approved. The CRIS is available on the TGA Internet. <http://www.tga.gov.au/fees/cris-npfees0809.htm> refers.
Note. Non-prescription (registered) medicines, together with other fees and charges currently imposed by the TGA, will be subject to a further comprehensive review in 2009, with a full cost recovery impact statement to be prepared.
Rounding
In applying the 3.6 per cent composite increase, fees and charges have been rounded to the nearest ten dollar (for amounts up to ten thousand dollars) and one hundred dollar (for amounts of ten thousand dollars or more).
For some lower value fees and charges (those which are currently less than $140), the current fee will remain unchanged because when the 3.6 per cent index, then rounding rules are applied, those fees or charges do not increase, specifically:
- The fee for export certificates remains unchanged at $120;
- The fees for approval of certain advertisements remains unchanged at $90;
- The application fee for low volume low value (LVLV) exemptions remains unchanged at $120; and
- The annual charge for Class I 'Other' medical devices remains unchanged at $60.
Low volume and low value products
Annual charges are not payable for therapeutic goods with a 'low volume, low value' turnover. To be eligible for an exemption from payment of annual charges in 2008/09, a sponsor must apply for a declaration that the turnover of a therapeutic good is low volume and low value, together with evidence of the product's turnover. Application forms are available on the TGA's Website <http://www.tga.gov.au/fees/forms/lowvolume.htm>.
To make this declaration, the Secretary must be satisfied that the charge for registration/listing is:
- greater than 6.8 per cent of the wholesale turnover of the good for the 2007/08 financial year or;
- if there was no turnover in 2007/08 greater than 6.8 per cent of the value of the estimated wholesale turnover in the 2009/10 financial year.
A non-refundable application fee of $120 per entry on the ARTG is payable and must be forwarded with the application form. If the amount of the application fees incurred by the sponsor in a year reaches $12,800, no further low volume low value application fees are payable in that year.
Goods and Services Tax
Fees and charges listed on the 'Summary of Fees and Charges' <http://www.tga.gov.au/fees/fees08.htm> are exempt from GST under Division 81 of A New Tax System (Goods and Services Tax) Act 1999.
An exception is the Pharmaceutical Benefits Advisory Committee listing fee, which has not been included on the Treasurer's Division 81 Determination for Exemption from the Goods and Services Tax (GST). Product sponsors will be able to claim the GST input tax credit for this fee.
Sponsors should note that 'No ABN Withholding' does not apply to the TGA as our ABN is quoted on the fee schedule and various other documents. The TGA is also exempt from paying income tax.
Refund policy
Application fees are non-refundable following receipt by the TGA. At the TGA's discretion, application fees may be transferred where a product was submitted incorrectly for assessment. Sponsors are asked to take care prior to submitting applications and submissions to avoid the loss of application fees.
Evaluation fees are non-refundable following acceptance by the TGA. Evaluations withdrawn prior to acceptance by the TGA may be subject to a screening fee as prescribed in the Regulations and detailed in the Summary of Fees and Charges <http://www.tga.gov.au/fees/fees08.htm>. Any residual payments due to the TGA in relation to an evaluation or assessment must be paid prior to entering a product in the Australian Register of Therapeutic Goods.
Annual charges are payable in respect of a financial year in which a therapeutic good is entered on the ARTG and are imposed as a levy (cost recovery tax) under the Therapeutic Goods (Charges) Regulations 1990.
As such, the charges are payable in full and are non-refundable. Apart from exemptions provided in the Regulations, the TGA has no power or authority to make reductions or impose pro-rata payment of charges. Products and licences cancelled during the year, and new products and licences issued, will attract full annual charges.
Correct fee
It is the sponsor's responsibility to submit the correct application, processing or evaluation fee to the TGA.
Due to the significant cost incurred in processing small refunds on fees, the TGA does not process refunds for overpayments where the amount is less than $100.