TGA Fee Cut Alleviates Dental Industry’s Compliance Costs

The peak body representing manufacturers and suppliers of dental products, the Australian Dental Industry Association (ADIA), has welcomed advice that the Therapeutic Goods Administration (TGA) plans to reduce most of its annual charges by 4.96% for the coming year.

The cut is associated with the annual charges that business must pay for placing medical devices on the Australian Register of Therapeutic Goods (ARTG), the TGA's list of therapeutic products that can lawfully be supplied in Australia.

"This cut in the TGA's annual charges is a welcome reduction to the regulatory compliance costs faced by businesses that manufacture and supply dental products in Australia. It's a promising sign that the TGA is cognisant of, and working to alleviate, the compliance burden it places on businesses," said Troy Williams, ADIA Chief Executive Officer.

In recent years ADIA has taken issue with the TGA's approach to setting its fees and charges which have seen many businesses in the dental industry face a significant increase in compliance costs.

"In 2015 the TGA changed the way that it levied annual charges for many products on the ARTG. An independent assessment undertaken by Deloitte Access Economics found that these changes resulted in an average 34% increase in regulatory compliance for businesses in the dental industry. That's what's made the issue of TGA's fees and charges a critical issue for our members," Mr Williams said.

Beyond the 2015 changes, ADIA has also been critical of the standard method used to increase the TGA's annual charges, this being the average of the Consumer Price Index (CPI) and the Wage Price Index (WPI) which effectively guaranteed increased income for the regulator. This model allowed the TGA to avoid the obligation to find operational efficiencies that has been prevalent across the public sector.

"It's been ADIA's contention that the standard method of calculating the TGA's fees in past years had little regard for the regulator's actual costs and the impost this placed on business. There was the perception that with a guaranteed annual increase in fees the TGA's bureacracy simply grew to match the size of its budget," Mr Williams said.

Reducing the compliance costs that the dental industry faces has been an advocacy priority for ADIA, and the TGA's budget setting process has been an ongoing aspect to this work.

"ADIA's efforts have worked to ensure that when it comes to setting its budget, the TGA is both transparent and accountable to the dental industry. In this context, the advice that most annual charges will be falling by around five per cent for the coming year highlights the importance of ADIA's sustained advocacy," Mr Williams said.

The reduced charges are expected to come into effect on 1 July 2017.