Therapeutic Products Bill – What can you do?

What is the Background to this bill?

Two previous attempts to regulate the natural health products industry with similar type legislation were withdrawn from parliament due to public pressure. These bills would have resulted in all small and medium sized health product manufacturers (the innovative sector) going out of business, because of excessive red tape and costs to comply, as well as capricious daily upper limits set on nutrients and not being able to truthfully convey the health benefits of products to consumers without undertaking multibillion dollar clinical trials.

When these bills were first proposed, the motivation by Medsafe, the New Zealand medicines regulatory authority, was that the public had to be protected from these potentially dangerous products. However, an intelligent assessment proves there is no substance to support this claim. In fact, there is evidence that demonstrates natural health products pose a de minimis risk of safety.

There is no legitimate “safety” problem that needs to be “corrected” by such legislation.

The Therapeutic Products Bill is based on the fallacy that it will increase exports

Another driver for this regulation comes from some proponents in the natural health sector who believe that introducing this type of legislation will increase exports. However, our analysis clearly shows that regulating natural health products under this type of structure will add significant costs to manufacturers of these products, due to additional compliance and presents barriers to trade. We see the Therapeutic Products bill regime as establishing a similar body to the Australian Therapeutic Goods Administration, which places huge costs on the natural health sector, stifling innovation and limits product availability.

There has been very little consideration of the costs, economic and otherwise, of regulation. The development of any regulation involves cost. The cost must in some capacity be compared against the benefit incurred by the proposed regulation. Of particular relevance to the raft of regulations in the field of supplemental nutrition, there has been almost no attempt by regulators to evaluate total costs or assess impact on health or business.

The costs that should be considered prior to the development of any regulation that is likely to disallow certain micronutrients at beneficial dosage ranges, include:

• The economic cost to industry of implementing the regulation, as compared with the benefits derived
• The cost to consumers of restricted choice
• The change in healthcare costs given the impact on consumer self-care and patient access to natural healthcare products

The proposed financing model of the new system presents significant risk to the majority of New Zealand small business supplement manufacturers, an outcome likely to result in only a small handful of large manufacturers remaining viable. This will result in a significant loss of variety of product in the natural supplements market in New Zealand.

The Therapeutic Products regulatory system will be funded by industry on a Full Cost Recovery Basis by annual registration charges on all products.

The regulations that will apply to GMP (Good Manufacturing Practice) under this bill, propose more stringent regulations than those for food. They are closer in fact to Pharmaceutical GMP.

It appears that regulators are ignoring the fact that there are ISO standards that are available for GMP in these areas and that MPI (Ministry of Primary Industries) has a perfectly good GMP for food products, that works for manufacturers already. Dietary supplements are a food product and as such should be regulated in a similar manner to fortified foods, which is the most efficient, effective and least cost method of regulation.

The GMP proposed under the Therapeutic Products Bill will not be accepted by overseas regulators who currently only recognise the Food GMP issued by MPI.

Export certificates therefore based on the proposed GMP will be useless for these products.

8 Key Points

• The Therapeutic Products Bill will replace the Medicines Act but extend far beyond the current Act’s coverage.
• It will set up a new regulator broadly modelled on the Australian Therapeutic Good Administration (the former regulator Medsafe will disappear into this entity).
• It will set up a new regime for “Natural Health Products” (dietary supplements and some topical creams although whether that extends to skin care cosmetics is not clear in the bill but is possible).
• Manufacturers and importers of Natural Health Products will need to meet new requirements and costs for auditing of factories and the current food regulatory approvals issued by MPI will be invalid.
• Medical devices right down to band aids will have far tighter regulation compared to the current notification system and will incur far larger costs as a result.
• Sunscreens will be regulated as therapeutic adding significant costs to importers and manufacturers who will then need to obtain approvals from the new regulator.
• The bill if passed will come into full effect by 2026, however some parts will come into effect far earlier where it is a direct replacement of the Medicines Act.
• There will be significant additional regulations to be made under the Act and there will be considerable discretionary power given to the regulator to produce these with oversight only resting with the Minister.

The above information is a high-level snapshot across all of the affected areas of the Therapeutic Products Bill, since the audience will be much broader than just dietary supplements.

Image by Nataliya Vaitkevich