Regulation of Pharmaceuticals and Other Drugs - PDF

Regulation of Pharmaceuticals and Other Drugs
Student name
Health Law
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Executive Summary
Pharmaceutical consumption is increasing all over the world. This trend has caused some
pressure on governments and consumers as both are the parties that that deal with costs of
purchasing these pharmaceutical products. In Australia, pharmaceutical products are regulated by
the Therapeutic Goods Act 1989 (Cth). The regulation of pharmaceutical products requires their
classification in to either listed (low risk) or registered (higher risk). The Therapeutic Goods
Administration together with a number of committees are the Government’s main agencies for
the enforcement of regulatory rules in pharmaceuticals. In addition, there is the Pharmaceutical
Benefits Scheme (PBS) which subsidizes the much of the prices of the drugs for Australian
patients. The PBS also has its rules that every drug product has to go through so that it can be
awarded a subsidy in the market. Nevertheless, despite the strong regulations, the Australian
government and the public are spending much on medicines causing public uproar. The PBS has
on its part enacted a series of policies for normalizing the prices. However, some of these
policies seems ineffective in drug price regulations. Therefore, in this paper, I will discuss about
the general outline of pharma sector in Australia and in which way Drugs get permitted and some
escapes in PBS and its possible policy resolutions in Australia. and describe policy solution
separately.

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Introduction
Governments in the world are arising to enact and enforce regulation to the
pharmaceutical industries. It is also a necessity for Australian to have the same strong regulations
of pharmaceutical products. The Therapeutic Goods Act 1989 (Cth) establishes both the
Australian Register of Therapeutic Goods (ARTG) and the Therapeutic Goods Administration
(TGA) which are the main bodies for the regulation of pharmaceutical products.1 The TGA scope
of regulation includes medicines that are prescribed by the specialists, medicines in the general
pharmacy (behind and over-the-counter), medicines sold in the supermarkets, supplements,
herbal medicines, medical devices, laboratory products for testing diseases, vaccines, etc.2 The
work of ARTG is the registration of all pharmaceutical products before their export, import or
supply within the state.3 Pharmaceutical Benefits Scheme (PBS) works as the public insurance
driver by subsidizing much of the costs that Australian residences have to pay to gain access to
the drugs. Australia has been spending much on drugs than in any other public service. In the last
report, the Australian government spent about 14% on PBS which is equivalent to $ 3.5 million
per day or $1.3 billion per year.4
1. Regulation of Pharmaceutical Products
The primary legislation that governs medicines and other pharmaceutical products in
Australia is the Therapeutic Goods Act 1989.5 This act also works together with the regulations
1 Ken Harvey, “Transparency and the Therapeutic Goods Administration,” Australian Prescriber
36, no. 4 (August 1, 2013): 110–11, https://doi.org/10.18773/austprescr.2013.043.
2 Ken Harvey, “Regulation of Complementary Medicines,” Internal Medicine Journal 47, no. 9
(September 2017): 983–85, https://doi.org/10.1111/imj.13548.
3 Dennis Campbell, International Consumer Protection, vol. 1 (Springer Science & Business
Media, 2013), 22.
4 Peter Breadon et al., “Australia’s Bad Drug Deal: High Pharmaceutical Prices,” SSRN Scholarly
Paper (Rochester, NY: Social Science Research Network, March 1, 2013),
https://papers.ssrn.com/abstract=2275103.
5 “Therapeutic Goods Act” (1989).

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set under the Therapeutic Goods Regulations.6 Both instruments complement each other to offer
safety to Australian citizens. The Therapeutic Goods Act aims to regulate matters that deals with
quality of medicines, their saftey safety, efficaciency and timely accessibility of therapeutic
goods.7 The act also provides for the requirements that need to met before a drug is listed or
registered in the Therapeutic Goods register. The Therapeutic Goods Regulations gives effect to
Therapeutic Goods Act by providing the conditions for manufacturing, suppliance, registering,
listing, and advertising of drugs in Australia.8 The authorities that forms part of the regulations
are the Therapeutic Goods Administration (TGA) and various committees. The TGA governs all
activities of distribution of medicines which include pre-market evaluations and approval,
manufactures’ licensing monitoring of post-market, development, the assessment of
pharmaceutical products for exportation. The committees make recommendations regarding the
drugs monitoring and regulations.
2. Procedure for the Approval of Drugs:
A new drug must first pass through the Australian Drug Evaluation Committee (ADEC)
for assessment of public safety. After which it would be listed for Therapeutic Goods
Administration (TGA).9 The product sponsors is then required to make application for their new
drug to be subsidized through the Pharmaceutical Benefits Scheme (PBS). An application for
PBS listing is evaluated by the Pharmaceutical Benefits Advisory Committee (PBAC). The
PBAC assess the drug to guarantee whether it is effective and whether its price is worth
6 “Therapeutic Goods Regulations” (1990).
7 Janice Hirshorn and Deborah Monk, “The Regulation of Therapeutic Products in Australia,” in
The Textbook of Pharmaceutical Medicine, ed. John P. Griffin (Oxford, UK: Wiley-Blackwell, 2009),
613–40, https://doi.org/10.1002/9781444317800.ch26.
8 Nicola K. Gale and Jean V. McHale, Routledge Handbook of Complementary and Alternative
Medicine: Perspectives from Social Science and Law (Routledge, 2015), 212.
9 Valérie Paris and Annalisa Belloni, “Value in Pharmaceutical Pricing,” OECD Health Working
Papers, July 11, 2013, https://doi.org/10.1787/5k43jc9v6knx-en.