Draft Therapeutic Products Bill PHARMACY FORUM 21 March 2019

Today’s team Sheila Swan – Chief Advisor, Regulatory Policy, MoH Hannah Adams – Senior Analyst, Regulatory Policy, MoH Susan Martindale – Principal Policy Analyst, MoH Andi Shirtcliffe – Chief Advisory Pharmacy, Office of the Chief Medical Officer, MoH Pamela Randell – Project Coordinator, MoH

Agenda Item 1 Overview of the intended therapeutic products scheme: Regulatory instruments, product coverage, key controls, types of authorisations 2 Overview of how controls apply to pharmacies 3 Differences that apply across all licence types 4 Enabling different distribution and supply arrangements 5 Ensuring pharmacy activities are under the control of a pharmacist Tea and coffee 6 Pharmacist supervision requirements 7 Restriction on prescriber interest in a pharmacy 8 Pharmacist and pharmacy worker authorisations 9 Medicines categories and access 10 Requirements for unapproved medicines 11 Authorisations for personal imports 12 Next steps te

Overview of the intended therapeutic products regulatory scheme

There will be less detail in legislation and more in the regulations and regulator-made instruments Content Process Therapeutic Products Act Primary legislation sets out: the purpose of the Act provides a set of principles and criteria to set the parameters of the regulatory regime sets boundaries for the scope and development of subordinate legislative instruments contains the primary elements of the regulatory regime provides enforcement powers sets out accountability arrangements Made by Parliament  Regulations Regulations will contain further detail on: matters not appropriately dealt with in regulator-made instruments (such as fee setting) matters to do with accountability key elements of the regulatory regime that will remain relatively stable and which are significant to the design of the regulatory requirements Schedule 3 lists the matters that can be specified in regulations Made by the Governor-General, by Order and Council Regulations will be subject to review by the Regulations Review Committee Rules Contain the detail of the regulatory requirements Schedule 3 lists the matters that can be specified in rules Made by the regulator Subject to review by the Regulations Review Committee Notices Covers operational aspects of the scheme Schedule 3 lists the matters that can be specified in notices The regulator must not issue a notice unless satisfied that doing so if necessary or desirable to promote the purposes of the Act; and it is no broader than is reasonable necessary to address matter that gave rise to it

A wider range of products would be covered The new system would regulate: Medicines This includes cell and tissue products and radiopharmaceuticals Medicines will continue to be classified: category 1 (prescription), category 2 (pharmacist), category 3 (pharmacy), category 4 (general sale) Active Medicinal Ingredients Defined separately from medicines, so a smaller set of controls can be applied to them Medical devices Type-4 products This is a catch all category for future therapeutic products that we don’t know about yet It will ensure the Regulator has the ability to apply regulatory requirements, as appropriate, when these products start coming to market The Government will be considering regulation of natural health products as a separate process.

The scheme would consist of two broad components Product approval requirements Generally a TP can’t be imported or supplied unless it is approved. Exceptions are: the Regulator can declare some classes of product to be approval-exempt the import &/or supply of an unapproved product for a specific patient via a ‘special clinical needs supply authority’ a licence or permit or regulation can authorise the import &/or supply of an unapproved product (eg for a clinical trial) There will be different approval pathways possible Controlled activity restrictions The Bill regulates who is allowed to carry out certain activities involving therapeutic products (called controlled activities) and how those activities are carried out In addition, the Bill also: Enables obligations to be imposed on people who in the course of business: import, supply, administer, use, or have possession of, any TPs Imposes restrictions on advertising Prohibits things such as tampering with, or misrepresenting, a TP.

The following would be controlled activities (which require an authorisation) Manufacturing a TP (which for medicines includes compounding and dispensing) Wholesale supply of most TPs -includes exports Non-wholesale supply of: Category 1 (Prescription) medicines Category 2 and 3 (Pharmacist- & pharmacy) medicines in the course of business Supply-restricted devices contrary to supply restrictions Type-4 products Carrying on a pharmacy business Conducting a clinical trial of a TP Prescribing a medicine or issuing a standing order (enabled via HPCA) Issuing a special clinical needs supply authority (for unapproved products) Administering prescription medicines Possessing prescription medicines and prescription medicine AMIs Taking medicines (except general sale) and prescription medicine AMIs overseas in the course of business Using use-restricted devices contrary to use restrictions, or type-4 products, on a patient.

The bill would enable flexibility in how controlled activities are authorised The draft Bill does not specify which type of authorisation should be used for particular controlled activities, but the general approach would be to use a: Bill or Regulations – when authorising a class of persons or all persons in a specific circumstance (eg. activities conducted by health practitioners) Licence – when authorising a particular person / or company on an on-going basis (eg. manufacturing, wholesale supply, pharmacy business) Permits – when authorising short-term or exceptional circumstance .

Getting ready for the new scheme Before the scheme can commence all of the following events must have occurred: The Bill must have received Royal Assent Regulations must be developed (following consultation), signed by the Governor- General, published and in force Rules and Notices must be developed (following consultation), published and in force The new Act, regulations, rules and notices would all come into force on the same date (the commencement date for the scheme) There is likely to be a gap of around two years between Royal Assent and commencement. During this time, planning and preparations for transition can begin The transition period begins on commencement date - so perhaps around late 2022 or early 2023

Regulator Form In providing advice to Cabinet on the Regulator Form, the Ministry will be considering: Independence: decision-making and operations Accountability Sustaining capability and capacity Positive regulatory culture Efficiency and effectiveness (includes cost of establishment and ongoing operations) Flexibility

Pharmacy

Pharmacy businesses will continue to be authorised via a licence The following controlled activities would be authorised via a licence: Manufacturing a therapeutic product Wholesale supply of a therapeutic products (excluding category 4 medicines) Non-wholesale supply of: Category 1 (Prescription) medicines Category 2 and 3 (Pharmacist- & pharmacy) medicines in the course business Supply-restricted devices contrary to supply restrictions Type-4 products Carrying on a pharmacy business Conducting a clinical trial of a TP.

Pharmacy licences will continue to regulate product-related activities not clinical advice Pharmacies are licensed under the Medicines Act, and would continue to be licensed under the Therapeutic Products Bill, to conduct activities that involve medicines. In particular: compounding dispensing non-wholesale supply of prescription, pharmacist and pharmacy (category 1, 2 & 3) medicines Pharmacist advice that does not involve the activities listed above (eg, provision of medicines-related clinical advice) are not regulated under this legislation, but are covered by the Health Practitioners Competence Assurance Act Where a controlled activity involving a medicine needs to include clinical advice to occur safely, the draft Bill achieves this by linking the authorisation to particular health practitioner profession(s) Decisions regarding the commissioning and funding of pharmacy services are made by District Health Boards.

There are some differences that would apply across all types of licences The requirements and obligations for licensees, and responsible persons named on the licence, are clearer (s128-130 and 153-158) One licence could authorise multiple activities (s123) One licence could authorise multiple sites, if the Regulator considers that appropriate. Noting, the Bill enables the Regulator to split applications where appropriate (s136) Licences could be issued for up to 3 years (s137) The responsible persons would have an obligation to report any non-compliance (s156) It would be an offence for a licensee or senior manager to induce a health professional to act unprofessionally (s155).

The definition of a pharmacy business is linked to controlled activities, not the premise Section 36: Meaning of a pharmacy business and pharmacy activity (1) A business is a pharmacy business if its activities include 1 or more of the following: (a) compounding medicines for non-wholesale supply: (b) dispensing medicines for non-wholesale supply: (c) supplying category 1 or 2 medicines by non-wholesale supply. (2) However, a business is not a pharmacy business if— (a) it is the professional practice of a health practitioner or veterinarian in which medicines are dispensed or supplied under the authorisations provided by sections 61 to 70; or (b) it is a business of a kind specified in the regulations not to be a pharmacy business. (3) For a pharmacy business, the following are pharmacy activities: (a) the activities listed in subsection (1): (b) supplying category 3 medicines by non-wholesale supply: (c) supplying medicines and medical devices by wholesale supply in circumstances permitted by the regulations. (4) If a business is a pharmacy business under subsection (1), then all of the pharmacy activities it carries on are taken to be part of the pharmacy business (and therefore subject to the terms and conditions of the licence). (5) However, if the business also carries on other activities that are not pharmacy activities, the business is only a pharmacy business to the extent of its pharmacy activities.

The pharmacy licence will allow different distribution and supply arrangements The licence and its requirements would only be focused on what activities are occurring as part of that business Pharmacy licences would be able authorise pharmacy activities involving medicines to occur in different locations The conditions and requirements on the licence would be specific to the type of service being provided and way they would be provided Depots will continue to be allowed as a storage and pick-up point for dispensed medicines in situations where no one in the area has a pharmacy licence. The authorisation to operate a depot would be part of the licence for the associated pharmacy Retail-only licences for the supply of category 3 (pharmacy) medicines would also continue to be allowed on an exceptions basis, where there is an access issue

In practice, the current majority pharmacist ownership requirements are not working as originally intended To be eligible for a pharmacy licence, s55D of the Medicines Act 1981 requires more than 50% of the share capital of the company is owned by a pharmacist or pharmacists and effective control of the company is vested in that pharmacist or pharmacists s55F of the Medicines Act prohibits a company from operating more than five pharmacies or a person who holds the majority ownership from holding a majority interest in more than five pharmacies These requirements are not well defined in the Act and have allowed a range of business arrangements to develop. For example, where the shares owned by the pharmacist are worth less than the shares held by the investor and/or do not return any dividends The five pharmacy limit, has been interpreted as allowing two or more pharmacists to jointly hold the majority interest in an unlimited number of pharmacies.

We are seeking feedback on two options for ensuring a pharmacist is in control of a pharmacy business The policy intent for both options is that a pharmacist is in control of pharmacy activities We are seeking feedback on two options to achieve this: Strengthened accountability though pharmacist ownership and effective control Open ownership with licence requirements targeted at pharmacist control of quality systems and practices within the pharmacy We are also seeking feedback on how each option could be implemented to ensure they work as intended.

Option 1: Strengthened accountability though pharmacist ownership and effective control Retain and strengthen the requirement that a pharmacist(s) has majority ownership and effective control of the pharmacy business Potential benefits: Reduce risk of negative impact of increased commercial interest in, and influence over, pharmacies Potential risks: Reduced potential for economies of scale and investment, business, loan or fee-based arrangements are used to circumvent the requirement Implementation considerations: how this requirement would apply to new definition of ‘pharmacy business’? whether the same pharmacist should have majority ownership and effective control? how should the ‘five-pharmacy’ limit be applied? what sort of transition would be required?

Option 2: Open ownership with licence requirements targeted at pharmacist control of quality systems and practices within the pharmacy The responsible person roles for a pharmacy licence would need to be a pharmacist. There would be two key functions (which could be performed by the same or different pharmacists) responsible for the: quality management systems that impact pharmacy and pharmacist practice and the safe provision of therapeutic products day-to-day implementation of those systems Potential benefits: Regulator efforts focused on pharmacy systems and practice, potential for greater investment in pharmacies Potential risks: Risk of negative impact of increased commercial interest in, and influence over, pharmacies Implementation considerations: how to ensure the pharmacist in the ‘supervisory pharmacist role’ would be able to effectively perform this function? whether the pharmacist in control of the systems and practice should be required to have particular qualifications, training or experience?

Supervision requirements Pharmacy activities would continue to only be able to be performed when a pharmacist is present (s 159) With new technologies available, this ‘presence’ could be achieved in different ways We are seeking feedback on whether there are particular situations, or pharmacy activities, where it would be safe and appropriate for this supervision to be provided remotely?

Restriction of prescriber interest in a pharmacy The restriction on prescribers having an interest in a pharmacy is retained in the draft Bill (s93) The draft Bill clarifies that whether they hold an ‘interest’ relates to whether that interest affects the ownership, management or control of the pharmacy business The regulator would continue to be able to exempt a pharmacy licence from this requirement, if it considers there are appropriate safeguards in place How might this restriction impact the evolution of the pharmacist profession, particular in relation to prescribing? We are seeking feedback on the risks or benefits of retaining or removing this restriction

Authorisations for pharmacists Pharmacy activities involving medicines require both a pharmacy licence and relevant qualifications (ie, an authorisation for a pharmacist or pharmacy worker) Pharmacists would be authorised (s57 and 58), subject to relevant requirements, to: Dispense approved and unapproved medicines and Non-wholesale supply approved and unapproved category 1, 2, & 3 medicines (no approval required for category 4) Compound unapproved medicines (as by definition compounded medicines are unapproved) Non-wholesale supply unapproved medical devices (no approval required for approved medical devices) Import unapproved medicines or medical devices Regulations could authorise pharmacists to wholesale in particular situations (s59) Could include authorisation for manufacturing steps (ie, packing & labelling without the patient name) Would set requirements to ensure safety of medicine & provision of required information.

Authorisations for pharmacy workers Qualified pharmacy workers would be authorised (s60) to perform the same activities as a pharmacist, as long as they meet the: Supervision requirements Non-wholesale supply of category 3 medicines under the general supervision of a pharmacist Other activities under the direct supervision of a pharmacist Ability to set lower level of supervision requirements via rules Qualification requirements, which will be set in rules (s37) This is necessary as the pharmacy workers are not a regulated workforce, so the Bill is unable to link to requirements under the HPCA Act

The Bill retains the current medicine categories, but would broaden access to the ‘pharmacy’ category Prescription medicines (category 1 in the Bill) As currently: A prescription would be required, the prescription requirements will be set in regulations Only specified professions would be authorised to prescribe. This would be set in their scope of practice (rather than the Act or Regulations), subject to the approval of the Minister of Health Prescribers, pharmacists and pharmacy workers (under the direct supervision of a pharmacist) would be able to supply prescription medicines to a patient, if there is a valid prescription Pharmacist and pharmacy (category 2 and 3) Prescribers and pharmacists would be able to supply pharmacist and pharmacy medicines to consumers Pharmacy workers would be able to supply pharmacist and pharmacy medicines to consumers New: Health Practitioners, and Health Practitioner workers, would be able to supply category 3 medicines, within the scope of their practice, to their patients General-sale medicines (category 4) As currently: There would be no restrictions on who can supply these, but would be minimum standards (eg, for display and storage) set in Regulations.

The requirements would tighten access to unapproved medicines The supply of an unapproved therapeutic product would require a ‘special clinical needs supply authority’ to ensure there is an active & recorded consideration of why an approved medicine is not appropriate As the ‘off-label’ use of a medicine is outside of its approval, a SCNSA would be required. However, there would be minimal requirements (eg, it could be a tick box on the prescription) Who can issue a SCNSA will be set via a mix of the Bill and Regulations. It is intended that: health practitioners could issue a SCNSA for unapproved medical devices health practitioner prescribers could issue a SCNSA for the off-label use of approved medicines only medical Practitioners could issue a SCNSA for medicines that have not been approved in New Zealand (as is the case currently). But once a SCNSA had been issued for a particular patient for a particular medicine, a health practitioner prescriber could prescribe that patient’s ongoing supply.

The requirements would tighten access to personal imports Objective - to balance personal freedom against protecting consumers from substandard, adulterated, or counterfeit medicines The Bill contains an authorisation that would continue to allow: people to bring all categories of medicines with them into the country import via post/courier of non-prescription medicines from other countries There is no authorisation for people to personally import prescription medicines via post/courier. They would need to seek a special clinical needs supply authority and obtain the medicine from their prescriber or a pharmacy once it had been imported for them. We envisage the importer would usually be a wholesaler It would be possible to use permits to authorise the personal import of prescription medicines via post/courier in some situations, if appropriate.

What next Sector forums in March Submissions due by 18 April Analysis of submissions & report back to Cabinet Draft Bill amended, as required Draft Bill introduced to Parliament Select Committee process (which usually includes a public submission process) Development of regulations, rules and notices – will involve consultation on detail of the scheme.