Cost Recovery Framework: International Comparison of Fees and Service Standards for Human Drugs

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August 2007

Contents

• Introduction
• Overview of Methodology
• Selection of Comparable Jurisdictions
• International Cost Recovery and Service Standards
  • United States Food and Drug Administration (FDA)
    • Fees and Cost Recovery
    • Service Standards and Reporting
  • European Medicines Agency (EMEA)
    • Fees and Cost Recovery
    • Service Standards and Reporting
  • United Kingdom, Medicines and Healthcare Products Regulatory Agency (MHRA)
    • Fees and Cost Recovery
    • Service Standards and Reporting
  • Australia, Department of Health and Ageing, Therapeutic Goods Administration (TGA)
    • Fees and Cost Recovery
    • Service Standards and Reporting
• Comparison of Fees
  • Submission Review Fees
  • Facility-Related Fees
  • Annual Product Fees
  • Scope
  • Processes
• Comparison of Service Standards
  • Submission Evaluation
  • Post-Market Activities
  • Penalties and Structure
• Conclusion
• Source Notes
• Annex 1 - Additional Jurisdiction Information

Introduction

The User Fees Act requires a regulating authority to establish standards which are comparable to those established by other countries with which a comparison is relevant and against which the performance of the regulating authority can be measured and to give reasons for the difference if the amount of user fee being proposed is higher than that existing in a country with which a comparison is relevant.

This document is a companion piece to the Cost Recovery Framework: Official Notice of Fee Proposal for Human Drugs and Medical Devices, and provides a more fulsome analysis of cost recovery and service standards internationally.

Overview of Methodology

Health Canada has devised an international comparison methodology which provides the basis for a consistent and objective comparison of health regulatory programs across international jurisdictions based on the following components:

Regulatory Context

the reasons underlying the regulations and the activities/services that are related to those regulations;

Regulatory service or product

what activities/services are associated with health related regulations being examined;

Performance standards

how the regulatory activities/services are delivered;

Type of clients / stakeholders

who is charged user fees for regulatory activities and services; and

User fees

identifies and explains similarities or differences between levels of fees charged.

Selection of Comparable Jurisdictions

Various countries with advanced regulatory systems collect user fees for drug and medical device regulatory activities. An initial analysis was conducted to identify relevant comparator jurisdictions. Based on that analysis, the countries for which a comparison has been deemed to be relevant are:

• the United States (U.S.);
• Australia;
• the European Union (EU); and
• the United Kingdom (UK) (as a specific example of the application of EU legislation in a member country).

The four jurisdictions have been chosen for international comparison with Canada because of the similarity of their regulatory frameworks for therapeutic products to that in Canada, and are thus considered to be "comparable". Nonetheless, there are a number of comparison challenges and caveats regarding this international comparison of fees and service standards.

Although the "regulatory contexts" including the legislative basis and regulatory objectives are similar, there are differences in the health product lines and product groupings, as well as differences in the fee structure for regulatory services.

Table 1 - Comparison of product lines subject to fees

Jurisdiction	Human Drugs
Canada	- biologics - prescription drugs - OTC (over-the-counter drug products) - generics
USA (FDA)	- biologics - prescription drugs - generics (2008)
European Union (EMEA)	- biologics - prescription drugs - OTC - generics
United Kingdom (MHRA)	- biologics - prescription drugs - OTC - generics
Australia (TGA)	- biologics - prescription drugs - OTC - generics

Europe and the United States are members (and Canada is an Official Observer) of the International Conference on Harmonization which makes recommendations on harmonizing scientific and technical aspects of pharmaceutical product registration. There is exchange of information among the member countries with respect to both pre and post-approval information. In addition, Canada has formal Mutual Recognition Agreements (MRAs) with the European Community and Australia, and a Trilateral Cooperation agreement including the United States, as well as Memorandums of Understanding.

Each jurisdiction has a similar fee-paying clientele. Many of the clients are multinational companies that market/manufacture in all five jurisdictions. The remaining balance of clients tends to be small to medium sized enterprises that have developed a niche product to fill an identified need in the market.

Although the four jurisdictions that were reviewed make information regarding their fee structures readily accessible to the public, including via the Internet, there was some difficulty in obtaining information regarding performance standards, particularly to the level specified in Canada.

Table 2 - Comparison of Cost Recovery for Human Drugs

Jurisdiction	Cost Recovery		Revisions to fees
	2005	2008 (estimated)
Canada1	25% ($32.1M)	60% ($92M)*	None to date
USA (FDA)2	56% ($US 269.4M)	$US 437.8M	Annually, legislation to be updated September 2007
European Union (EMEA)3	67%	67%	last updated Jan. 2006
UK (MHRA)4	100% (£63.9)	100%	Annually, last updated April 2007
Australia (TGA)5	100%		Annually; last updated August 2006

There are clearly differences in the rationale for charging user fees, and differences in the financial and business context within the jurisdictions. This also translates into a difference in the level of cost recovery that has been implemented. Additionally, there are varying market sizes, price modulation processes and market access issues between the jurisdictions.

A significant challenge is the ongoing changes to the regulatory and policy environments that result in continually changing levels for fees and service standards internationally. Canada is not alone in renewing the drug fee structure. Australia is moving towards the Trans Tasman Therapeutic Products Agency with New Zealand, which will result in a revised regulatory framework and fees for drugs (and medical devices). The United States is in the process of renewing the Prescription Drug User Fees Act (PDUFA) this fall. In the EU, the European Medicines Agency (EMEA) implemented new fees on January 13, 2006. In the UK, the Medicines and Healthcare products Regulatory Agency (MHRA) implemented new fees for licensing medicines on April 1, 2007.

International Cost Recovery and Service Standards

For the human drug international comparison, the activities and fee structure for each jurisdiction will be described, followed by a comparison to the activities and fees proposed in the (Canadian) Cost Recovery Framework.

United States Food and Drug Administration (FDA)

The FDA is a part of the Department of Health and Human Services, responsible for the regulation of therapeutic products, including human and veterinary drugs, biological products, medical devices, and products that emit radiation.

The US is considered the market of choice for first submission by the top 10 pharmaceutical companies¹, but this was not always the case. Prior to the introduction of the PDUFA in 1992, the FDA faced severe challenges with a backlogged review workload and increasing public dissent demanding timely access to experimental drugs to treat public health crises, particularly treatments for HIV. Timely drug review became a public health issue and PDUFA was created. The legislation was designed to integrate drug review performance with fee collection from industry. Since its inception, PDUFA has been the driving force behind improving the FDA's regulatory performance.

Fees and Cost Recovery

The FDA has legislative authority to charge fees for human prescription drugs under the Prescription Drug User Fee Act of 1992 (PDUFA). Fee cycles are five years long and PDUFA has been renewed twice: PDUFA II in 1997; and PDUFA III in 2002. Public discussions are currently underway for PDUFA IV in 2007. While the enabling legislation PDUFA is revised and renewed every five years, the individual fees payable by industry are revised and published every year.

There are three legal conditions that FDA must satisfy each year before the Agency can collect and spend user fees:

• overall FDA salary and expense appropriations cannot be reduced below 1992 levels for drugs (adjusted for inflation);
• the amount of user fees collected in each year must be specified in Appropriation Acts; and
• FDA must maintain review appropriations at or above 1992 levels for drugs (adjusted for inflation).

FDA establishes fees in an effort to assure that the total revenue collected approximates the adjusted total fee amount required by legislation, taking into account projected fee waivers and reductions. Carryover balances are permitted; fees collected and appropriated, but not spent by the end of a fiscal year, continue to remain available for FDA to spend in future fiscal years. A change in the PDUFA model is being discussed during the current renewal process, of redirecting revenue into the general accounts of the US government, rather than directly funding the FDA.

Through PDUFA, the FDA is authorized to fees from companies that produce human prescription drugs (including biologics), but not other types of products, including nonprescription drugs. Any time a company wants to market a new human prescription drug or biological product it must submit a submission along with a fee to support the review process. Companies also pay annual fees for each manufacturing establishment and for each product marketed in support of post-market surveillance and risk management activities. Statutory revenue levels for each of the three fee types are equal, establishing a balanced program. Therefore, revenue collected for product fees is approximately the same as revenue collected for establishment fees and application fees, and overall this revenue represents approximately 66% of the funding for these activities.

The statute establishes revenue targets, adjusting for inflation and workload. Each fiscal year (FY), the FDA establishes user fee rates and payment procedures so that rates match revenue targets. Inflation adjustments reflect the greater of: the Consumer Price Index increase during a 12 month period; or the increase in pay for a FY for federal employees stationed in Washington, DC. Workload adjustments are calculated as an average over a three to five year period of submissions received, to target approaching FY workload volumes (and project revenue collected in the upcoming FY).

Under separate legislation proposed for the 2008 Budget (under changes to the Federal Food, Drug and Cosmetic Act), the FDA is planning on establishing fees for each new generic drug product application and annually for all approved generic drug products.

Service Standards and Reporting

Performance commitments are clearly designed and specific, entrenched in the legislative authority of PDUFA, and available to the public, making performance reporting requirements over the five year period consistent and transparent from the first year onwards. The commitments include both qualitative and quantitative performance measures as well as procedures (listed in Table 4). Examples include reviewing 90% of standard New Drug Applications within 10 months of receipt; scheduling meetings within 14 days of receipt of request; contracting with an outside consultant to evaluate the pilot programs related to continuous marketing applications; and developing a guidance on Good Review Management Principles. In total, over 23 specific performance goals were included in PDUFA III, as well as numerous procedures, activities and proposals. There are no directly financial implications for missing any of these performance goals, however Congress may chose not to renew the PDUFA program when it comes up for renewal if these goals have not been met.

All PDUFA financial and performance commitments are reported annually in Performance Reports to the President and the Congress. There is also an annual "Report to the Nation", highlighting progress on strategic initiatives, pre-market review, drug approvals, post-market initiatives, new guidance documents and other broader topics.

European Medicines Agency (EMEA)

The EMEA was formed in 1995 as the European Union's coordinating agency for the regulation of medicinal products. The centralized procedure for authorization of medicinal products in the European system is compulsory for all biotechnology products, as well as certain other medicines (HIV/AIDS, cancer, diabetes, neurodegenerative disorders) including orphan products. The decentralized procedure and mutual recognition procedure apply to the majority of conventional medicinal products. There are 42 National Competent Authorities (NCAs) that comprise the European Economic Area, including Germany, Italy, France and the United Kingdom.

The EMEA mobilizes vast scientific resources - a network of over 3,000 scientific experts throughout the EU to address its regulatory responsibilities. These experts underpin the scientific work of the EMEA and its committees. An ongoing priority of the EU is to work with accession countries to comply with basic principles of medicinal products regulation within a single market in order to protect public health. Community legislation (coordinated by the EMEA) provides a network among all national regulatory bodies.

Fees and Cost Recovery

Through Regulation (EC) No 1905/2005, the EMEA collects fees from companies that produce human medicines, including biologics. Companies pay fees for the marketing application authorisation review process, inspections of manufacturing establishments and annual fees for each product marketed in support of post-market surveillance and risk management activities. The EMEA also charges fees for the provision of Scientific Advice.

On March 31, 2004, pharmaceutical legislation was revised, outlining procedures for the authorization, supervision and surveillance of medicinal products for human use. New and increasing responsibilities concerning post-market surveillance requirements resulted in a corresponding 10% increase in annual fees. Significant reductions in fees for generic medicinal products were also applied (a decrease of 22%), better reflecting the actual cost of evaluating such applications. New fees were introduced in various areas pertaining to the provision of scientific services, including traditional herbal medicinal products.

The EMEA pays national authorities for the provision of scientific services provided under contract to the EMEA. Half of the fees received by the Agency for submission evaluation, establishment licensing and scientific advice for human medicines and up to 30% of annual fees are redistributed to the national competent authorities.

Service Standards and Reporting

Procedural targets for scientific assessment are outlined in the pharmaceutical legislation. For example, the Committee for Medicinal Products for Human Use has 210 days to adopt an opinion on a new medicine and by day 300 issues a final decision, taking into account legal and public health issues.

Annual performance (including financial information on fee revenues and expenditures) is reported in the "Annual Report of the European Medicines Agency". This comprehensive report covers all of the major activities undertaken by the EMEA, and outlines several performance metrics throughout the report, including: timelines taken to issue (Centralized Procedure) market authorisation opinions, post authorisation opinions (the number of opinions issued and the overall process time), adverse drug reaction reports, and arbitration and community referrals.

United Kingdom, Medicines and Healthcare Products Regulatory Agency (MHRA)

The Medicines and Healthcare Products Regulatory Agency (MHRA) is an agency of the Department of Health in the UK, established in April 2003 from a merger of the Medicines Control Agency and the Medical Devices Agency. The MHRA is responsible for overseeing that human medicines and medical devices work and are acceptably safe.

Fees and Cost Recovery

The MHRA is a Government Trading Fund and is fully funded (i.e. 100% cost-recovered) for its medicines regulatory function by fees in association with the manufacturing, sale and supply of medicines. Through various regulations, including The Medicines (Products for Human Use-Fees) Regulations and The Medicines (Homeopathic Medicinal Products for Human Use) Regulations, the MHRA collects fees from companies that produce human medicines including homeopathic medicines and biologics. Companies pay fees for the marketing application authorisation and clinical trials review process, inspections of manufacturing establishments and annual fees for each product marketed in support of post-market surveillance and risk management activities. The MHRA also charges fees for the provision of scientific advice and blood-related activities.

In addition to the range of fees collected for running the medicines regulatory program, the MHRA collects income from running conferences, education programmes (e.g. targeted programmes with groups of healthcare professionals and Royal Colleges), and twinning² activities with other EU Member States. The MHRA strives to continuously develop additional income-generating services and refers to itself as a "business" with a commitment to protecting public health.

As part of its costing forecast, the MHRA projects business volumes for the upcoming fiscal year, including expected applications for new medicines; number of inspections; number of enforcement activities; number of adverse drug reaction reports; number of signals investigated; Periodic Safety Update Reports and other vigilance activities. Additionally, the MHRA is able to retain and carry forward its surplus to pay for cost increases in future years, and has a legal duty to earn at least a 3.5% average rate of return on its assets.

Service Standards and Reporting

Performance targets and budget are outlined in the annual Medicines and Healthcare Products Regulatory Agency Business Plan. For 2007/08, there were 10 key targets and 15 high level targets related to their business activities. For example, key targets include addressing and eliminating backlogs and developing and implementing risk assessments for all inspection types. High level targets include for example, completing 97% of the assessment reports Licensing Authority Determination for abridged applications in 125 calendar days.

Performance, including financial performance, is reported in the MHRA Annual Report and Accounts, which includes the number of safety warnings issued, number of adverse reaction reports received, progress of expert working groups, number of clinical trial applications received and assessment times, and the number of reactive and proactive compliance investigations conducted.

Australia, Department of Health and Ageing, Therapeutic Goods Administration (TGA)

The TGA, as part of the Australian Government Department of Health and Ageing, has responsibility for administering the Therapeutic Goods Act of 1989 which came into effect on 15 February 1991. The objective of the Act, is to provide a national framework for the regulation of therapeutic goods in Australia to ensure the quality, safety and efficacy of medicines and ensure the quality, safety and performance of medical devices. Most products for which therapeutic claims are made must be either listed or registered in the Australian Register of Therapeutic Goods (ARTG) before they can be supplied in Australia.

Fees and Cost Recovery

From 1 July 1998, the TGA has been required by the Government to fully recover its operating costs for all activities that fall within the scope of the Act, including regulation of industry and the TGA's public health responsibilities.

The TGA recovers the full cost of its regulatory responsibilities under the Act, including regulatory development, public accountability, and international activities related to the regulation of pharmaceuticals. This includes product vigilance, labelling and advertising controls and recalls, and other post-market activities such as enforcement activities and investigations. The annual licensing charge is imposed on all registered medicines to recoup these post-market costs; they are not part of the pre-market fee. Over the five-year period from 2003-04 to 2007-08, the TGA undertook a transition of the fee structure to provide a better balance between costs for registering medicines (pre-market costs) and costs of performing post-market activities and maintaining the regulatory framework. Therefore the costs recovered from pre-market evaluation activities have decreased over this five-year period, while the annual charge has increased. The annual license charge is considered to be an annual levy or cost recovery tax, and is not subject to service standards.

Additionally, in 2003 the TGA introduced a new simplified fee structure for the registration of prescription medicines, moving away from fees based on page counts. However, page count fees have been retained for other submission fees.

The TGA uses an activity based costing (ABC) methodology for the assignment and allocation of all direct, indirect and overhead costs to activities undertaken. The cost model is used in budgeting by substituting the actual costs with the budgeted figures TGA has developed based on its business plans and forecasts of activity volumes. Specific fees and charges are determined by dividing the cost pool for each product group by the number of applications expected to be received.

Service Standards and Reporting

The Act sets out performance standards for evaluation of some therapeutic goods, primarily prescription medicines.

When a sponsor applies for the registration of a new prescription medicine, the TGA must decide within 40 working days whether it will accept the application for evaluation. Following acceptance of the application, the TGA must complete the evaluation and make a decision on registration of the product within a further 255 working days. If the TGA fails to complete the evaluation within 255 working days, it forfeits 25% of the evaluation fee otherwise payable by the sponsor; these requirements are laid down in the Act.

If, during the evaluation, the TGA has to ask the sponsor for additional information to complete the review, the evaluation "clock" stops while the TGA is waiting for the sponsor to reply. Time spent waiting for response from the sponsor is not included in the 255 working days, but is referred to as "sponsor time."

If a sponsor is modifying an existing product and the evaluation does not require clinical, preclinical or bioavailability data, the TGA must complete the evaluation within 45 working days.

The TGA reports its performance on a quarterly basis, and includes this information in Annual Reports at an overview level. There is also more detailed information regarding service standards for the evaluation of therapeutic products on their Web site under "How long does it take to evaluate a prescription medicine?".

Comparison of Fees

In general, the proposed fees are comparable with those of the international comparators, with a few exceptions, which are discussed below. A detailed list of fees in the comparable jurisdictions is provided at the end of this Section in Table 3.

Submission Review Fees

The proposed Canadian fees for the evaluation of a New Active Substance Drug Submission ($303,480 for pharmaceuticals and $391,770 for biologics) are lower than in the US ($958,934) and comparable to the EU ($351,332 for single strength, dosage form, presentation; the lowest component combination). However the proposed fees are higher than the fees in the UK ($198,620) and Australia ($160,830). The higher Canadian fee is a result of different costing bases compared to the UK and Australia. For example, some components of policy and regulatory developments work are not included in the other jurisdictions. Additionally, the UK charges separately for scientific advice meetings, reclassifications and label assessments. All of these costs are included in the submission review fees for Canada.

For generic products, the Australian review fee ($58,730) is higher than in Canada (comparative/chemistry and manufacturing, pharmaceuticals at $43,360), as is the $132,292 generic submission review fee in the EU. The US is in the process of establishing fees for generic products, but the individual fees amounts are not yet published.

For submissions consisting solely of published scientific literature, the UK charges the full complex application fee of $54,911, compared to the proposed Canadian fee of $17,000. Neither the US nor Australia have a specific fee for these types of submissions.

The Canadian fee model for submission review has been simplified, moving away from the existing component approach to a flat fee determined by the type of submission. This revised structure aligns more closely with those of the comparable jurisdictions. Australia also recently revised their fees for prescription products, moving away from a page-count-based fee structure (although fees for nonprescription products are still established by that model).

Facility-Related Fees

Establishment licensing fees are more complicated to compare given the varied fee structures and amounts. The US charges a flat fee of $335,017 as does the EMEA of $26,350 while the UK charges from $8,737 up to $50,809 for manufacturers, depending on the number of employees at the site. Importers/wholesalers in the UK pay up to $3,493. Australia charges an initial application fee of $632, as well as flat annual fee of $4,021 plus an hourly audit rate. Canadian rates are based on a variety of components that are not easily comparable with those foreign fees. The fee for a wholesaler in Canada will be $3,870, the fee for an importer/distributor will start at $6,440 and the fee for a fabricator will start at $15,450; overall, drug establishment licensing fees are expected to average $21,500 with a median fee of $14,000 (excluding the narcotic fee component).

Direct comparisons are not possible for facility-related fees, as each jurisdiction has a different fee structure and variables, such as number of employees, facility activity, product scope, length of audit/inspection. Information related to how many hours the average audit takes in Australia or the average size of affected companies in the UK is not available.

The UK is the only other jurisdiction which charges a fee for Good Clinical Practice inspections, with fees ranging from $10,950 to $54,725 based on the activities conducted at a particular site. These fees are considerably higher than the $650 proposed in Canada.

Annual Product Fees

For annual product licensing, Canada's proposed fees of $1,020 are significantly lower than the majority of international fees. The annual fee to market a prescription product in the US is $53,233. Canada and the US are also the only jurisdictions to charge a flat fee for all qualifying products, although the US fee is limited to prescription products (and will soon introduce a separate annual product fee for generic products). Other jurisdictions have various annual product fees based on the type of product or licence. For example, in the EU, there is a standard fee of $125,995, but also fees for generic products ($31,499) and biosimilar products ($62,816). In the UK, a new active substance pays $39,560 for each of the first five fee periods following the year of approval and the standard annual fee ranges from $905 to $4,075. Canada has proposed a flat fee for all drug products rather than specific fees for types of products based on level of risk, as it is very difficult to determine the level of risk for products for post-market surveillance and compliance or enforcement activities.

Although Australia's annual fees for OTC and complementary medicines ($621 - $795) are lower than that proposed in Canada, their fee for a prescription biologic product ($3,903) is three times higher and for a prescription non-biologic ($2,340) more than twice as high. In Australia , there are also separate charges for activities related to advertising review (also under consideration in the US), while in Canada the costs associated with those activities have been incorporated into the annual product fee.

Scope

Nonprescription products are handled differently in the various jurisdictions. For example, the US does not charge fees for Over-the-counter (OTC) products as their fee legislation is currently limited to prescription drugs. While the UK charges fees for OTC products, Australia is the only jurisdiction that has specific fees for nonprescription products, and their fees are lower than those proposed for Canada. The Canadian fees for these products are higher than in Australia due to the fee structure of a flat fee based on median costs of different groups of products, rather than setting fees for specific groups of products. The proposed fees mirror the regulatory approach for nonprescription products in general. These products share the same regulatory requirements as prescription products and thus also the same fees as prescription products; review fees are based on submission type and level of effort and associated costs, annual and establishment fees are based on cost of program delivery for all products. Annual fees are not differentiated by product type, so the Canadian fees may be higher for these products than in some jurisdictions, but lower for others. For example, the proposed Canadian annual product fee of $1,020 is payable for all drugs, resulting in a higher annual fee for OTC products than compared in Australia ($621), but lower than the Australian annual product fee for biologic products ($3,903).

For cosmetic-like drugs, the Canadian proposal is higher than any other jurisdiction. In the US, drug/cosmetic combination products are subject to regulation as a drug (i.e. deodorants that are also antiperspirants, moisturizers and makeup marketed with sub-protection claims, shampoos that also treat dandruff), but would generally be nonprescription and therefore have no associated fees; this is also the case in the UK and EU. Australia charges fees for certain of these products (i.e. sunscreen of over SPF 15), but at a much lower level than those proposed in Canada. Fees in Canada are higher than elsewhere in part due to the different regulatory classification of products as well as a different approach to risk management and fee structure (as described earlier for nonprescription products in general).

In Canada , homeopathic products are currently regulated as drugs and pay the associated fees, but are transitioning to the Natural Health Products regulatory framework by 2009. As long as these products continue to be regulated as drugs, there are fees payable for the review and annual product licensing. Therefore, some of the proposed fees will be payable for homeopathic products. However, once fully transitioned, these products will no longer be required to pay the drug fees, but will be included in discussions for natural health product fees. The MHRA and Australia have specific fees for homeopathic products. The MHRA regulates and charges a review fee for homeopathic medicines and some herbal remedies ($330 - $14,906), as well as annual fees ranging from $41 to $202. Australia has specific fees for complementary medicine review ($468 - $858) and annual fees of $795. In the US there is currently no provision for charging for complementary and alternative medicine products by the FDA except for those that are covered under the existing statutory definitions as a prescription drug or biological product. Although fees for homeopathic products may be higher in this proposal than elsewhere, this will change once the natural health product regulatory framework has been fully implemented.

In general, all jurisdictions charge fees for biological products, but some have specific fees targeted for those products. For example, the annual submission fee in Australia is significantly higher for a biologic prescription product compared to a non-biologic product, but they do not differentiate for evaluation fees.

Processes

The US, Australia and UK all have annual adjustments to their fees, to reflect changing costs and workloads. The US adjusts based on inflation and workload; while Australia and the UK adjust annually to ensure their fees reflect their complete costs. Canada is proposing an annual adjustment based on a blended index be included as part of the fee regulations, but is anticipating a lower rate of adjustment than currently used in the other jurisdictions.

All jurisdictions have some form of fee mitigation to reduce the impact that fees have on fee payers. In the US, it is based on a regulated definition of a small business or orphan product or paediatric designation; qualifying companies are allowed to pay a reduced fee and qualifying products are exempted from fees. In the UK there are fee delays to provide small businesses with additional time to pay the fee or exemptions for paediatric indications. The UK also has reduced fees for annual product licensing based on certain thresholds of product sales, and a lower fee if the product is not intended to be manufactured or imported for that year. In the EU, there is a dedicated Small and Medium-sized Enterprises (SME) Office which provides administrative and procedural support as well as fee reduction provisions and exemptions. In Australia, it is based on low volume of sales or definition of small business, and those qualifying are either exempted or allowed to pay a reduced fee. Canada is proposing fee caps for products and companies with low volumes of sales, and exemptions or delays for organizations that meet certain criteria such as supporting national defence or humanitarian purposes.

In the UK and US, full payment of submission review fees is required at the time of application, or else the submission is not considered complete. Canada and Australia have a staggered payment schedule for submission fees, with 75% payable at the beginning of the process, and the remaining 25% payable upon issuance of the first review decision. The EMEA changed its method of collecting fee income from an upfront payment scheme to an invoicing system in December 2005.

In the UK, if a periodic fee is not paid within a reasonable time, the product licence may be suspended until payment is received. In the US, an application will not be considered for review if the company is in arrears for any user fees owed the federal government. Canada does not have, nor is proposing a similar authority based on our different regulatory and business models.

All fees are shown in Canadian dollars, using exchanges of $1.07 for US, $1.51 for EU, $2.13 for UK and $0.90 for Australia.

Table 3 - International Fees

Fee Type	Canada (proposed)	Australia (TGA) as of Aug.11/06	UK (MHRA) as of Apr.1/07	EU (EMEA) as of Jan.13/06	USA (FDA) as of Aug.2/06
Submission Evaluation	new active substance: pharmaceuticals: $303,480 biologics: $391,770 Clinical/ chemistry & manufacturing: pharmaceuticals: $153,710 biologics: $157,650 Clincal only pharmaceuticals: $71,740 bioliogics: $99,320 Chemistry & manufacturing/labelling pharmaceuticals: $20,500 biologics: $76,000	prescription new chemical entity $160,830 [AUD 178,000] OTCs, no clinical data $5,710 [AUD 6,320] plus fee based on type of submission and page count $5,710 - $39,780 [AUD 6,320 - 44,200]	licence applications marketing authorizations major $198,620 [GBP 93,249] abridged: simple $5,489 [GBP 2,577]	application for market authorization (single drug strength, dosage form, presentation) $351,332 [EUR 232,000] variations to or extension of a market authorization major $105,399 [EUR 69,600] no clinical data $52,700 [EUR 34,800]	new drug application with clinical data $958,934 [USD 896,200] new drug application with no clinical data or supplement with clinical data $479,467 [USD 448,100]
	comparative/ chemistry & manufacturing pharmaceuticals $43,360 biologics $50,000 Prescription to OTC Switch with same condition(s) of use $41,280	generic prescription product $58,730 [AUD 65,000]	abridged: complex: $54,911 [GBP 25,780] abridged: standard: $20,135 [GBP 9,453]	application for market authorization no clinical data (single drug strength, dosage form, presentation) $136,292 - $227,154 [EUR 90,000 - 150,000]	generic - TBD in 2008
	DIN A, DIN D, DIN F (Labelling standard) $1,530 DIN D (review of disinfectant application) $3,820	registration of complementary medicines application $858 [AUD 950] listed medicine application (including cosmetic-like drugs) $468 [AUD 520]	homeopathic registration $330 - $14,906 [GBP 155 - 6,998]
	notifiable changes pharmaceuticals: $4,180 biologics: $4,730 labelling only pharmaceuticals: $2,760 biologics: $2,760 administrative submission $285	changes to prescription product (chem & mfg, clinical) $3,668 - $3,822 [AUD 4,060 - 4,230] variation of an OTC, no clinical data $2,060 [AUD 2,280]	variations to marketing authorization $379 - $76,757 [GBP 178 - 36,036]
AnnualLicencing	$1,020	biologic prescription medicine $3,903 [AUD 4,320] non-biologic prescription medicine $2,340 [AUD 2,590] registered OTC medicines $795 [AUD 880] Listed OTC medicines $621 [AUD 690] complementary medicines $795 [AUD 880]	human drugs periodic fees $160 - $39,560 [GBP 75-18,573] homeopathics periodic fees $40 - $145 [GBP 19 - 68]	human medicines marketing authorization maintenance $125,995 [EUR 83,200] generic $31,499 [EUR 20,800] biosimilar $62,816 [EUR 41,600]	prescription drug $53,233 [USD 49,750] generic - TBD in 2008
Establishment Licensing	1) GMP (basic fee range) $6,440 - $15,450 with additional classes $1,550 - $27,040 (component based, multiple combinations possible) 2) drug analysis $3,870 - $25,750 3) controlled substance inspection $4,510 per location	GMP licence application $632 [AUD 700] GMP annual licence $4,021 [AUD 4450] Manufacturers of blood, tissues: $93,426 [AUD 103,400] plus hourly rate for GMP audit $416/hr - $569/hr [AUD 460/hr - 630/hr]	pharmaceutical inspection $537 - $50,809 [GBP 252 - 23,854] establishment license homeopathic $1,591 - $17,896 [GBP 747 - 8,402]	human drug facility inspection $26,350 [EUR 17,400] plus travel expenses	prescription drug establishment $335,017 [USD 313,100]

Comparison of Service Standards

A detailed list of service standards in the comparable jurisdictions is provided at the end of this Section in Table 4.

The other international jurisdictions do not provide published service standards for all of their cost-recovered regulatory activities; where possible, standards have been identified for comparison.

Submission Evaluation

Service standards for the review of various types of drug submissions are generally comparable among the jurisdictions.

Review of New Active Substance submissions

Review of priority supplemental drug submissions

Review of generic new drug submissions

Review of administrative submissions

The Canadian standards are for the review function, initiated once the submission is considered complete as per a screening process. This is consistent internationally. For example, in the US, the drug submission is not considered complete until it has been deemed to address all requirements in an appropriate manner. Therefore although the service standard in the US is time to review and act on a submission within 10 months of receipt, the definition of receipt includes a complete submission so the clock does not start until the submission is deemed complete.

Post-Market Activities

The US and EMEA have a commitment to report on activities related to post-market surveillance but no specific service standards or timeframes for related activities. The UK commits to 3 - 7 days to process adverse drug reaction reports, while Australia targets initial professional review of adverse drug reaction reports within 3 days. The UK also has additional qualitative commitments under the key target of pro-active surveillance and enforcement programs, such as an anti-counterfeiting strategy.

Regarding compliance and enforcement activities, only the UK and Australia have specific service commitments. Under the key target to 'maintain rigorous inspection programmes', the UK has several general commitments, including publication of performance information, and to develop risk assessments for all inspection types. Their only quantitative standard is to inspect 95% of sites identified in the risk-based Good Practice inspections plan. Australia has timeframes for conducting on-site audits (within 3 months for new licence application and 6 months for routine audits), and sending audit reports to manufacturers (within 20 days from on-site audit).

Canada is the only jurisdiction to propose service standards related to the issuance of a licence related to post-market activities. Development of quantitative service standards for post-market surveillance activities or compliance and enforcement activities is difficult given the unpredictability and volatility of the activities involved, and this difficulty is reflected in the absence of significant service standards internationally.

Penalties and Structure

INo other jurisdiction has a penalty for not meeting performance as detailed in the UFA. The closest comparison is Australia; if the TGA fails to complete the evaluation of the new prescription medicine (or generic submission) within the service standard of 255 working days (357 calendar days), it forfeits 25% of the evaluation fee otherwise payable by the sponsor. The US has a global penalty clause, in that if its performance standards are not generally met, Congress will not renew the entire cost recovery program upon expiry (for the next five years).

The US has a very extensive list of performance goals and procedures in PDUFA related to submission review and pre-market activities, including review performance, major dispute resolution performance, meeting management and guidance development. Australia also has many performance measures and major projects identified in their Business Plan for both pre- and post-market activities and reported against (including workflow process improvements and the development of joint regulatory schemes), but not related or linked to fees. Canada has many similar procedures, commitments and performance goals; however they are also not directly linked to fees nor published in regulations.

The FDA phased in progressive performance goals over the first five-year life of the statute (e.g. 60% of submissions reviewed on time in first year, 75% in second year; and 90% by the third year onwards) (PDUFA I). As goals are met and new targets established, the FDA is under constant scrutiny to continuously raise the bar in various facets of regulatory performance.

Table 4 - International Service Standards

A: Human Drugs - Submission Evaluation
Jurisdiction	Service Standard / Commitment
Canada	Type of Submission	Calendar days for first review (to first decision)
	New Active Substance	300 days
	Clinical/ chemistry & manufacturing	300 days
	Clinical only	300 days
	Chemistry & manufacturing/labelling	180 days
	Comparative/ chemistry & manufacturing	180 days
	Notifiable changes	90 days
	Labelling only	60 days
	Administrative submission	45 days
	DIN D ( review of disinfectant application)	180 days
	DIN A, DIN D, DIN F (Labelling standard)	45 days
Australia (TGA)	When a sponsor applies for the registration of a new prescription medicine, the TGA must decide within 40 working days whether it will accept the application for evaluation. Following acceptance of the application, the TGA must complete the evaluation and make a decision on registration of the product within a further 255 working days (357 calendar days). If the TGA fails to complete the evaluation within 255 working days, it forfeits 25% of the evaluation fee otherwise payable by the sponsor. If, during the evaluation, the TGA has to ask the sponsor for additional information to complete the review, the evaluation "clock" stops while the TGA is waiting for the sponsor to reply. Time spent waiting for response from the sponsor is not included in the 255 working days, but is referred to as "sponsor time." If a sponsor is modifying an existing product and the evaluation does not require clinical, preclinical or bioavailability data, the TGA must complete the evaluation within 45 working days.
United Kingdom (MHRA)	Maintain rigorous authorisation programmes Medicines licensing timescale targets, to be achieved by the final quarter of 2007/8 or earlier: Abridged Applications, Registrations for Traditional Herbal Medicines, Registration of Homoeopathic remedies and National Rules Scheme: time to complete the assessment report from receipt of a valid application for National applications (or procedure start date for European procedures): Assessments for Licensing Authority Determination: 99% in 150 calendar days, 97% in 125 calendar days, 80% in 100 calendar days Assessments Requiring Advisory Committee/Commission Advice: 98% in 185 calendar days, 80% in 160 calendar days Variations to Product Licences (time to complete assessment from receipt of valid application for national variations, or EC start date for mutual recognition variations) Type IA notifications: Type IB notifications: 98% within 14 calendar days 98% within 30 calendar days, 85% within 20 calendar days Type II variations: Type II reduced or extended timescale variations: 98% within 90 calendar days 98% in 30/120 calendar days respectively, 85% within 60 calendar days Report annually, including: Number of new medicines (new active substances) assessed and average number of days to complete assessment report Number of applications received and processed within European targets Number of device products evaluated and number of evaluation reports produced Number of clinical trial authorization applications received and average assessment time Number of abridged applications determined Throughput (applications received and determined) of parallel import Applications Number of Mutual Recognition assessment reports produced and average time to completion of the report (Target time is 90 days) Improve performance across the Agency's medicines licensing operations by targeting areas where there are backlogs. Ensure that, over the year as a whole, the number of determinations exceeds the predicted numbers received by at least 10% in each of the following areas of activity: New Product Licences granted in National, Mutual Recognition or Parallel Import procedures; and Variations to National (Type II, non-safety) or Parallel Import licences. Continue to improve the transparency of decision making within the Agency and accountability to the public by: publishing UK Public Assessment Reports for medicinal products licensed within 60 days of final determination; and providing summaries of the evidence supporting major safety decisions within one month of final regulatory decision.
European Union (EMEA)	Performance metrics reported annually but very few reported standards to be met. 90 days or less for orphan designation procedures For centralized procedures for new medicines, the Committee for Medicinal Products for Human Use has 210 days to adopt an opinion, by day 300 the EC issues a final decision. 120 days for maximum residue limit applications
USA (FDA)	Generic Submissions: 70% within 180 days by end of 2008 [72% in 2009, 73% in 2010, 75% in 2011, 80% in 2012, 85% in 2013, 90% in 2014] Review Performance Goals (PDUFA III) Review & act on 90% of standard original New Drug Applications (NDAs) and Product Licence Applications/Biologic Licence Applications (PLAs/BLAs) within 10 months of receipt Review & act on 90% of Priority original NDAs and BLAs within 6 months of receipt Review & act on 90% of standard efficacy supplements within10 months of receipt Review & act on 90% of priority efficacy supplements within 6 months of receipt Review & act on 90% of all manufacturing supplements within 6 months of receipt and 90% of those requiring prior approval within 4 months Review & act on 90% of Class 1 resubmitted original applications within 2 months of receipt Review & act on 90% of Class 2 resubmitted original applications within 6 months of receipt Review and act on Class 1 resubmitted efficacy supplements within 2 months of receipt [30% in 2003; 50% in 2004; 70% in 2005; 80% in 2006; 90% in 2007] Review & act on Class 1 resubmitted efficacy supplements within 4 months of receipt [90% in 2004, 2005, 2006] Review and act on Class 1 resubmitted efficacy supplements within 6 months or receipt [90% in 2003] Review and act on Class 2 resubmitted efficacy supplements within 6 months of receipt. [90% in 2003, 2004, 2005, 2006, 2007] Issue discipline review letters for pre-submitted "Reviewable Units" of NDAs/BLAs in 6 months [30% in 2004; 50% in 2005; 70% in 2006; 90% in 2007] Report substantive deficiencies (or lack of same) within 14 days after 60 day filing date for original NDAs, BLAs, and efficacy supplements [50% in 2003, 90% in 2006, 90% in 2007] The performance goals for standard and priority original New Molecular Entities (NMEs) are the same as for all of the original NDAs but reported separately. For biological products, all original PLA/BLAs are considered to be NMEs. Continuous Marketing Applications: Discipline review team of a "reviewable unit" for a Fast Track drug or biologic will be completed and a Discipline Review Letter (DRL) issued within 6 months of the date of the submission [30% in 2004, 50% in 2005, 70% in 2006, 90% in 2007] Independent Consultants for Biotechnology Clinical Trial Protocols: If FDA denies request, it must provide a written rationale within 14 days of receipt [100% in 2003, 2004, 2005, 2006, 2007] First Cycle Review Performance Proposal: FDA will provide the sponsor a notification of deficiencies (or lack of same) within 14 calendar days after the 60-day filing date [50% in 2003, 70% in 2004, 90% in 2005, 2006, 2007] Meeting Management Goals FDA will provide notification of meeting details within 14 days of request for formal meeting for 90% 90% of meetings are held within the timeframe 90% of minutes are issued within 30 calendar days of date of meeting Other Goals Respond to 90% of sponsor's complete responses within 30 calendar days of receipt of complete response (Clinical Hold) Respond to 90% of appeals to decisions within 30 calendar days of receipt of the written appeal Complete and return 90% of special protocols assessments and agreement requests within timeframes Additional procedures, activities, commitments are listed for the following: Meeting Management Clinical Holds Major Dispute Resolution Special Protocol Question Assessment and Agreement Continuous Marketing Application Pre- and Peri-NDA/BLA Risk Management Plan Activities Independent Consultants for Biotechnology Clinical Trial Protocols First Cycle Review Performance Proposal Improving FDA Performance Management Electronic Applications and Submissions Goals Additional Procedures

 

B: Human Drugs - Annual Product Renewal
Jurisdiction	Service Standard
Canada	120 calendar days to update the Drug Product Database following company notification of product renewal
Australia (TGA)	Adverse Drug Reaction Reports reviewed by a professional within 3 working days of receipt and reports entered into database within two weeks of receipt. Assess risk, prioritise action and initiate remedial action (where appropriate) within 2 working days for medicine problem reports regarding the quality, safety and/or efficacy of OTC or complementary medicines. Enter problem report information in database within 5 working days.
United Kingdom (MHRA)	Maintain and develop pro-active surveillance and enforcement programmes Implement the anti-counterfeiting strategy including: - increasing public and stakeholder awareness by holding an MHRA anticounterfeiting conference during 2007; maintaining targeted market surveillance and testing of the medicines most at risk of counterfeiting (including newly identified high risk products); collaborating with the World health Organisation (WHO) anticounterfeiting taskforce; disrupting and, where appropriate, prosecuting 20 enterprises engaged in the distribution and supply of counterfeit medicines; collaborating with industry. Promotion of the Yellow Card scheme for patients and healthcare professionals and investigate and develop new methods of gathering adverse reaction (ADR) reports and data. Reviews of five established medicinal products or classes (including European harmonisations) where the risk/benefit in clinical use might have changed significantly within set timescales. Promote and demonstrate wider use of the General Practitioner Research Database (GPRD) database in the interests of medicines safety and reduced medication error with measured increased usage in the database. Ensure that potential drug safety signals from whatever source are detected and recorded (within 3 working days) in the IT system (Sentinel) in a consistent manner (examples of possible source of signals are ADR reports, Periodic Safety Update reports (PSURs), Clinical trials and literature reviews). Promptly capture reports of adverse drug reactions and device adverse incidents, initiating timely and appropriate action to protect public health. Ensuring maximum number of working days between receipt of reports and making them available for evaluation and analysis: - 3 for fatal and serious device adverse incidents - 3 for fatal adverse drug reactions and 5 for serious reactions - 7 for identification and transmission of suspected medication errors to the National Patient Safety Agency Communicate authoritative and reliable information and advice Issue, through an effective process, drug alerts, medical device alerts and other safety warnings, supported by relevant media activity where appropriate, which identify clear and appropriate action which recipients can achieve within realistic timescales, reviewing the effectiveness of these alerts through feedback monitoring. Continue to improve the transparency of decision making within the Agency and accountability to the public by introducing the quarterly publication (as appropriate) of identified drug safety signals and MHRA action to ensure transparency
European Union (EMEA)	Various performance metrics reported annually but no reported standards to be met.
USA (FDA)	No published standards or targets to be met.

 

C: Human Drugs - Establishment Licensing
Jurisdiction	Service Standard
Canada	250 calendar days to issue a licence
Australia (TGA)	Conduct 100% of on-site audits of Australian manufacturers within 3 months from the date of receipt of a new licence application. Conduct 100% of routine audits within 6 months from their scheduled dates. Conduct 90% of on-site audits of overseas manufacturers within 12 months from date of receipt of an application for overseas audit. Send 90% audit reports to manufacturers within 20 working days from the date of the on-site audit. Assess all alleged breaches of the Therapeutic Goods Act 1989 within 10 working days and initiate appropriate response. Problem report investigations finalized within target timeframes. Program of targeted and complaint testing for products in support of enforcement actions: test urgent samples within 1 week of receipt of sample.
United Kingdom (MHRA)	Maintain rigorous inspection programmes Introduce the regular publication of a range of performance information agreed. In discussion with the industry associations, on the Agency website from April 2007. Before each quarter, agree a risk-based plan for Good Practice inspections in the medicines sector; during the quarter, inspect 95% of the sites in that plan, including all those deemed to be of high risk. Minimise the burden of regulation so far as is compatible with our public health role Take actions to progress the Government's Better Regulation agenda: Develop and implement risk assessments for all inspection types.
European Union (EMEA)	Performance metrics reported annually but no reported standards to be met.
USA (FDA)	No specific non-financial goals to report on; however general activities in this area are described in the annual Report to the Nation.

Conclusion

The User Fees Act requires a regulating authority to establish standards which are comparable to those established by other countries with which a comparison is relevant and against which the performance of the regulating authority can be measured and to give reasons for the difference if the amount of user fee being proposed is higher than that existing in a country with which a comparison is relevant.

HPFB considers the proposed service standards to be comparable to those published for the US, UK, EU and Australia, where they exist. Some jurisdictions have more qualitative or general standards, but they are not necessarily directly linked to fee-related activities, nor held accountable with financial penalties for non-performance. Within the requirements of the User Fees Act for measurable standards, the standards proposed are comparable with those of the international jurisdictions. Additional performance reporting measures are under consideration and development by HPFB, similar to some of those in the other jurisdictions.

The proposed Canadian fees are generally based on our regulatory frameworks and requirements and are not targeted at specific types of products. Canada does not have a specific regulatory framework for nonprescription or cosmetic products, and when those products meet the existing legislative definition of a drug, they are required to pay the associated fees and are accountable to the set service standards. Therefore, product classification does impact fees payable by including certain products under the definition of 'drug'. Other jurisdictions may classify products differently, resulting in a different scope of fees and regulated activities. Another factor influencing fee amounts relates to the activities assigned to different fee categories in the different jurisdictions, resulting in varying levels of fees. For example, jurisdictions that charge separately for the provision on scientific advice may have lower submission fees compared with Canada where those activities are include in the submission review fee. Additionally, these fee comparisons are based on fees currently being charged in the international jurisdictions (in 2006 or 2007), while the proposed Canadian fees are for 2008/09, by which time the US, UK and Australia will all have revised fees, likely increased by 4 to 15%. In instances where the proposed fees are significantly higher than those in the comparable jurisdictions, an explanation has been included in the text of this document.

Source Notes

Annex 1 - Additional Jurisdiction Information

United States / Food and Drug Administration (FDA)

Population 302M, GDP $13.244 trillion (per capita $44,190)

The FDA is a part of the Department of Health and Human Services, responsible for the regulation of therapeutic products, including human and veterinary drugs, biological products, medical devices, and products that emit radiation. There are five centers under the FDA:

• Center for Drug Evaluation and Research (CDER) which reviews prescription and over-the-counter drugs to assess safety and effectiveness;
• Center for Devices and Radiological Health (CDRH) which reviews the safety and effectiveness of medical devices, and limits human exposure to man-made radiation;
• Center for Food Safety and Applied Nutrition (CFSAN) which regulates food and cosmetics;
• Center for Biologics Evaluation and Research (CBER) which regulates biological products; and
• Center for Veterinary Medicine (CVM) which regulates veterinary drugs.

Europe / European Medicines Agency (EMEA)

Population 494M, GDP $15.849 billion (per capita $31,173)

• The EMEA was formed in 1995 as the EU's coordinating agency for the regulation of medicinal products. The EMEA mobilizes vast scientific resources - a network of over 3,000 scientific experts throughout the EU to address its regulatory responsibilities. These experts underpin the scientific work of the EMEA and its committees.
• In 2005, the EMEA collected 77.5 million Euros in fee revenue, with about 34.4 million Euros subsidized through other sources including the European Commission (EC), and European Economic Area. Total expenditures were 111.8 million Euros, with user fees representing about 69% of total costs required to deliver the program (for human and veterinary medicines). The EMEA pays national authorities for the provision of scientific services provided under contract to the EMEA. Half of the fees received by the Agency for submission evaluation, establishment licensing and scientific advice for human and veterinary medicines and up to 30% of annual fees are redistributed to the national competent authorities. In 2005, EMEA payment to national competent authorities totalled EUR 35,492, 000, representing 32% of the Agency's total budget in 2005.⁴

United Kingdom / Medicines and Healthcare Products Regulatory Agency (MHRA)

Population 60M, GDP $2.373 trillion (per capita $38,624)

• The Medicines and Healthcare Products Regulatory Agency (MHRA) is an agency of the Department of Health in the UK, established in April 2003 from a merger of the Medicines Control Agency and the Medical Devices Agency. The MHRA is responsible for overseeing that human medicines and medical devices work and are acceptably safe.
• The MHRA is a Government Trading Fund and is fully funded (i.e. 100% cost-recovered) for its medicines regulatory function by fees in association with the manufacturing, sale and supply of medicines. The majority of trading income covers the costs of human medicines regulation. In 2004/05, the MHRA collected 57.7 million British Pounds (GBP) in fee revenue (with 57.3 million derived from activities relating to human medicines regulation), and received GBP 14.7 million from the Department of Health to cover the costs of regulating medical devices. Total expenditures were 71.4 million British Pounds.

Australia / Department of Health and Ageing, Therapeutic Goods Administration (TGA)

Population 21M, GDP $822.1 billion (per capita $39,320)

• The TGA, as part of the Australian Government Department of Health and Ageing, has responsibility for administering the Therapeutic Goods Act 1989 which came into effect on 15 February 1991. The objective of the Act, is to provide a national framework for the regulation of therapeutic goods in Australia to ensure the quality, safety and efficacy of medicines and ensure the quality, safety and performance of medical devices. Most products for which therapeutic claims are made must be either listed or registered in the Australian Register of Therapeutic Goods (ARTG) before they can be supplied in Australia. From 1 July 1998, the TGA has been required by the Government to fully recover its operating costs for all activities that fall within the scope of the Act, including regulation of industry and the TGA's public health responsibilities.
• The TGA carries out a range of assessment and monitoring activities to ensure that all therapeutic goods (medicines or medical devices) available in Australia are of an acceptable standard. At the same time, the TGA aims to ensure that the Australian community has access, within a reasonable time, to therapeutic advances. Overall control of medicines is exerted through five main processes:

1. pre-market evaluation and approval of registered products intended for supply in Australia;
2. development, maintenance and monitoring of the systems for listing of medicines;
3. licensing of manufacturers in accordance with international standards of Good Manufacturing Practice;
4. post-market monitoring, through sampling, adverse event reporting, surveillance activities, and response to public inquiries; and
5. assessment of medicines for export.

• The regulatory framework within which the TGA operates is based on a risk management approach that relates to the level of scrutiny applied to therapeutic products for inclusion in the ARTG. Medicines assessed as having a higher level of risk must be registered medicines; those considered to be of lower risk are listed medicines. Within registered medicines, products are evaluated as either "high-risk" (mainly prescription) or "low risk" (mainly non-prescription); the former undergo rigorous and detailed assessment and sponsors are required to provide comprehensive safety, quality, and efficacy data. Complementary medicines (also known as "traditional" or "alternative" medicines) include vitamin, mineral, herbal, aromatherapy, and homeopathic products. These may be either listed or registered, depending on their ingredients and the claims made. Medical devices are indicated as being included on the ARTG.

Canada / Health Canada

Population 33M, GDP $1.1 trillion (per capita $32,614)

• Since the inception of the cost recovery program, actual revenues recovered have been less than the total revenue re-spending authority of $40.7 million, forcing the HPFB to make up for the shortfalls from existing tax-based appropriations. Actual respendable revenues (funds collected for user fees) for HPFB, as reported in the Health Canada Departmental Performance Report for the past three fiscal years were: 2003-04: $34.6 million, 2004-05: $35.1 million, and 2005-06: $37.7 million, all short of the net vote authority.
• If HPFB receives a surplus resulting from higher than anticipated revenues (for example, because of a large volume of incoming submissions), it can retain up to 25% more revenue than the net vote authority if the expenditures have increased by that amount in a given year. The remaining surplus is retained in a departmental consolidated revenue fund. HPFB cannot currently "carry over" the surplus into future years, that is, the branch does not have access to this money.

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4  Annual Report of the European Medicines Agency 2005 B EMEA/MB/63019/2006, http://www.emea.europa.eu/pdfs/general/direct/emeaar/AnnualReport2005.pdf