Media Release

16 December 2005

Medsafe looks to revise fees for the evaluation and registration of medicines

The agency responsible for regulating medicines is consulting on increasing its fees from 1 July next year for the first time in well over a decade, and in some cases for the first time in 28 years.

The increases reflect the rising costs of regulation as demands on Medsafe to evaluate, audit and monitor the safety of medicines and their manufacture increase.

For instance an application to Medsafe for a new medicine (involving a new chemical entity) typically involves the evaluation of a quarter of a tonne of paperwork.

Under the Medicines Act fees are levied on applications to licence medicine manufacturers and to approve new medicines and clinical trials. Fees are also levied under the Misuse of Drugs Act for applications for licences to, for example, import and export controlled drugs.

Medsafe's Principal Technical Specialist, Dr Stewart Jessamine, says this is the first time since 1977 that fees under the Misuse of Drugs Act have been revised. Fees under the Medicines Act have not been increased since they were first introduced 15 years ago.

"The fees in most cases have been falling well short of covering the actual costs of the complex work related to applications for licences and approval of medicines," Dr Jessamine says.

It is important for New Zealand to meet international best practice standards for the regulation of medicines and also to maintain specialist technical expertise in this area.

The growing gap between the cost of evaluating medicine safety and the amount recovered in fees has meant that approvals for some medicines have been taking as long as three years to process.

Dr Jessamine says it would be tempting to predict that the fee increases will mean shorter times for approving medicines. While that will be true in the long term as capability is strengthened within Medsafe it will be at least a year or 18 months before any improvement can be demonstrated.

"While in most cases the fees for high risk complex activities are going to increase significantly, it is important to note that they still come well under other developed countries, including Britain, the United Sates of America and Australia."

It's important to remember that the work involved in ensuring medicine safety in New Zealand is no less demanding, or important than it is in other overseas jurisdictions, Dr Jessamine says.

Medsafe will begin consultation this week with organisations and individuals affected by the fee increases and feedback from the consultation will be considered before finalising the new fees.

A copy of the discussion document is available on the Medsafe website at www.medsafe.govt.nz


Dr Stewart Jessamine will be available for media interview between 2:30pm and 4pm on Friday 16 December. For further details please contact:

Lucy Taylor
Media Advisor
Ministry of Health
04 496 2067
027 207 1406
email lucy_taylor@moh.govt.nz

What are the proposed fees?

	Current fee ($) ex GST	Proposed fee ($) ex GST
Licences under the MODA
Licence to deal in Controlled Drugs	10	840
Licence to possess Controlled Drugs	10	840
Licence to import Controlled Drugs	10	170
Licence to export Controlled Drugs	10	170
Licences under the MA
Licence to Sell Medicines by Wholesale	266	937
Licence to Sell Medicines by Retail	44	750
Licence to Hawk Medicines	62	750
Licence to Operate a Pharmacy	844	917

	Current fee $ (excl GST)	Proposed fee $ (ex GST)
Licence to Manufacture Medicines	3,377	12,222
Licence to Pack Medicines	266	750

Application type	Current Fee ($) ex GST	Proposed Fee ($) ex GST
Application for consent to supply a new medicine	13,600	109,000
Innovative chemical or biological medicine	13,600	109,000
Generic medicine	6,933	39,000
Non-prescription medicine	6,933	6,800
Application for provisional consent to supply a new medicine	4,444	7,500
Application for approval of a material change to a medicine	1,422	2,844
Major change	1,422	2,844
Minor Change	355	710
Self-assessable change	177	354
Application to approve a clinical trial	2,488	8,750

How do these fees compare with other developed countries?

The revised fee schedule for New Zealand still falls well below the charges of other similar developed countries.

Examples of this include:

The proposed New Zealand fee for an application to approve a new innovative product with a new chemical or biological ingredient is $109,000 (excl GST). The equivalent application fee in Australia costs $205,092 (NZD); in the United Kingdom it costs $424,560 (NZD); and in Canada the application fee is $161,590 (NZD).