Powerpoint from the TGA sponsor information sessions outlining the changes from the Low Value Turnover (LVT) scheme to the new Annual Charge Exemption (ACE) scheme.

1. Information session
Ms Nicole McLay
Assistant Secretary, Regulatory Business Services Branch
Regulatory Support Division, TGA
June 2015
Annual Charge Exemption Scheme

2. 1
Representatives from the TGA
• Ms Nicole McLay
– Assistant Secretary, Regulatory Business Services Branch
• Mr Vinod Mahajan
– Director, Regulatory Decision Review
• Ms Jo Flynn
– Regulatory Education Section
Annual Charge Exemption Scheme

3. • Background
• Key features
• New ACE scheme components
• Waivers
• New rates of annual charges
• Compliance program
• Sponsor actions
• Key dates
Annual Charge Exemption Scheme
Annual Charge Exemption Scheme 2

4. Background
• Low value turnover exemption scheme introduced 1990
– No longer meets objectives
– Complex and burdened with red tape
– High number of complaints
– Inconsistent with government’s cost recovery policy
– Unsustainable and inequitable
• Consultation paper released in 2014
• New scheme commences 1 July 2015
1990
2015
Annual Charge Exemption Scheme 3

5. Key features
• Rates of annual charges will reduce for some product categories
– from 5% to 23%
• Self declaration - online system to make notifications and declarations
• Significant reduction in administration - $3m p.a. in savings to industry
• A new waiver option for annual charges
Annual Charge Exemption Scheme 4

6. New ACE scheme - components
Annual Charge
Exemption (ACE)
Scheme
Begins 1 July 2015
New entries from
1 July 2015 will
automatically
qualify and be
granted
exemption
ACE applies
until
commencement
of turnover
No application
fee
Existing entries at 1 July
2015 pre-qualify if LVT
exempt in last 2 years
on basis of $0 turnover
Annual self-
declaration
through client
portal or by mail
No TGA
delegate
decision
Annual Charge Exemption Scheme 5
Sponsors will
not be invoiced
for ACE entries

7. Benefits of ACE
• No application fee – additional saving of $2.4m p.a. to industry
• A high number of current exemptions continue (74%)
• No third party accountant certification
• Only need to declare no turnover rather than the value of turnover
• Annual charges are reducing for:
– non-biological (chemical) prescription medicines, and
– medical devices class IIa and above
• Annual charge invoices only issued for non-exempt entries
• Waivers available on public health/financial viability grounds
Annual Charge Exemption Scheme 6

8. Waivers new waiver option under ACE
Available for
registered medicines,
biologicals, devices
class IIa or higher and
IVD class 2 or higher
Decision by a
TGA delegate
Waiver refused,
annual charge
payable
Decision
appealable
Waiver criteria
• public health risk if product
is removed from the ARTG
• product becomes financially
unviable if annual charge
applies
Annual
application
Annual Charge Exemption Scheme 7

9. Chemical prescription medicines - 2 levels of annual charges
• Two levels of annual charges for chemical prescription medicines based on
pharmacovigilance activities/costs:
– Higher amount – relevant goods until 8th anniversary*
– Lower amount – most generic medicines*, relevant goods past 8th anniversary
• Relevant goods = new chemical entity, extension of indications, or change to
intended patient group
• Other major variations such as new formulation, change of strength, dosage
forms – higher or lower amount depending on parent good
• *goods containing certain active ingredients will always attract the higher
amount – thalidomide, leflunomide, lenalidomide, mifepristone, clozapine and
isotretinoin
Annual Charge Exemption Scheme 8

10. Fees and charges 2015-16
• Non-biological prescription medicines
– 23% reduction in annual charge for lower amount
– 5% reduction in annual charge for higher amount
• Medical devices
– 5% reduction in annual charges for class IIa and above
• All fees and charges
– 2.12% increase in fees and charges (CPI/WPI 2.5%)
• Revised fees and charges schedule - TGA website 1 July 2015
Annual Charge Exemption Scheme 9

11. Audit and compliance program
• Audit and compliance assurance program will commence
• Uses existing information collecting provisions in the legislation
• Failure to provide information in response could result in
suspension/cancellation of entry
• Providing incorrect declaration results in cancellation of the
exemption – from year of turnover (multiple annual charges
could become payable)
• Criminal Code applies
• Exempt and waived entries published on the website
Annual Charge Exemption Scheme 10

12. Sponsor actions
• Letter sent to sponsors with pre-qualified entries 3 June
– please check your list of exempt entries
– new entries will be automatically exempted
• Notify commencement of turnover for exempt entries at any time
• Declaration of $0 turnover between 1 - 22 July each year for prior year
to maintain exemption
first declaration July 2016
• Payment of annual charges by 15 September each year
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13. Key dates
June 2015
Advice to sponsors on existing entries, information sessions, website material
1 July 2015
ACE scheme commences
Between 1 July and 22 July (annually starting 2016)
Sponsor self-declares that entry had $0 turnover in the previous financial year
Sponsor may notify commencement of turnover at any time
July (annually)
Annual charge invoices issued for non-exempt entries
15 September (annually)
Due date for the payment of annual charges
Annual Charge Exemption Scheme 12

14. More information
TGA website - https://www.tga.gov.au/annual-charge-exemption-scheme
email: ace.scheme@tga.gov.au
13Annual Charge Exemption Scheme