Pharmas producing drugs for the Australian market may see manufacturing licence charges slashed if their products do not sell above a certain threshold according to a plan outlined by the TGA.
The Therapeutic Goods Administration (TGA) announced that annual charges may be cut by as much as 50 per cent for firms whose drugs generate wholesale turnover that “is below a prescribed level” and asked eligible drugmakers to apply for the reduction.
Under the scheme the TGA explained that companies seeking the reduction should provide it with sales estimates for the following financial year as well as supporting documentation.
The administration then has 30 days to review applications and respond to companies in writing, with those whose applications are declined being required to pay the full fee.
The regulator also said that manufacturers whose products exceed the reduction threshold at any time during the year are required to notify it as the full charge may be payable.
The TGA also said that companies fraudulently submitting low sales estimates to try and benefit from the reduction will be liable to prosecution.
How low can you go?
The TGA did not specify the minimum threshold or the specific fees to which the reduction will apply. However, the current version of its fees summary does provide some hints in the section covering low value, low volume goods.
“The threshold of sales used in calculation of Low Volume Turnover products for exemption of Annual Charges is 15 times that of the Annual Charge.”
Whether this plan will be enough to placate the industry groups that complained about the TGA’s plans to increase its charges 5.6 per cent across the board is unclear.