FromFri, 25 June 2004

Hon Annette King - Speech to MIANZ Annual Conference: The benefits of a Trans-Tasman Therapeutic Products Joint Agency

MIANZ has been active in calling for stronger regulation of medical devices, and in particular a pre-market approval mechanism, for many years. I am pleased that the Government has been able to respond to those calls by moving to introduce a regulatory scheme that will bring New Zealand into line with the rest of the developed world.

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Thank you very much for inviting me to speak at your annual conference. I know you've been treated to a selection of interesting, knowledgeable speakers already today so I hope I can uphold the high standards!

I am very pleased to be able to join you in your silver jubilee year as you celebrate the important contribution that medical technology makes to the health of New Zealanders. As the saying goes, times change, and it is interesting to reflect on the pace of change over the last quarter-century.

Twenty-five years ago we didn't have the technology to perform keyhole surgery, and a gall bladder operation required a large surgical incision and a hospital stay of several days. In contrast, these days we take laparoscopic surgery using sophisticated cameras and video monitors for granted. Such advances in surgical techniques have resulted in improved outcomes and lower relative costs.

Significant advances have been made in medical technologies in the last 25 years too. From gene therapy to tissue engineering and the application of nanotechnology in the prevention and treatment of disease, technological advances have resulted in exciting improvements in the delivery of healthcare in the 21st Century. We have seen advances in medical device technology, pharmaceuticals, surgical techniques and transplantation procedures make a considerable contribution to improving the health status of New Zealanders.

As you may or may not know, in my former life I was a dental therapist so naturally dental healthcare has always been a subject close to my heart. I'm sure many of you will remember those terrifying trips to the "murder house," but nowadays there's no sign of the old dental clinic drill that used to instil such fear into everybody. It has been replaced by the high-tech, high-speed, low-pain models we now take for granted. The development of dental restorative treatments that look better and last longer is just one example of the impact of nanotechnology in dentistry.

While there is no doubt that the emergence of new technologies has provided clinicians and their patients with significant advances in health care, the availability of these new technologies has also presented challenges. Yet it is not a problem unique to New Zealand. Healthcare providers the world over struggle with the same issue: how to prioritise in order to work within the constraints of limited funding?

I know Stephen McKernan has just talked to you about the challenges facing District Health Boards. In an era where ever-increasing demands are being placed on New Zealand's healthcare resources, DHBs face the need to monitor current demand and forecast future demand for technology as they make purchasing and management decisions.

Purchasers must weigh the benefits against the costs to determine where the taxpayer dollar will be most effectively spent. Continual reassessment is needed to monitor the ongoing need for existing technologies and the emerging need for new ones. This task is made easier and more efficient if reliable, unbiased information about product safety and quality is readily accessible. This is one of the significant benefits that enhanced regulation of medical devices can deliver.

MIANZ has been active in calling for stronger regulation of medical devices, and in particular a pre-market approval mechanism, for many years. I am pleased that the Government has been able to respond to those calls by moving to introduce a regulatory scheme that will bring New Zealand into line with the rest of the developed world.

I share your concern about the potential for New Zealand to become a dumping ground for sub-standard products that would not be acceptable in countries that have a modern regulatory system. I want to assure you that I am taking positive action to address that concern.

Like you, I want to see a risk-based system of regulation that is based on a globally harmonised approach. We all want to see a level playing field that keeps the cowboys out, but at the same time is adaptable and responsive to the regulatory challenges created by innovations at the cutting edge of technology. That is what I expect to see delivered through the joint regulatory scheme with Australia. As you know, the joint scheme will be based on the framework recommended by the Global Harmonisation Taskforce, or GHTF.

For the health care provider, the benefits of a regulated medical device market will be significant. Currently New Zealand is out of step with the rest of the developed world because, with the exception of a few specific product types, there is no requirement for devices to meet minimum standards of safety, quality and performance and no pre-market assessment of higher-risk products.

Furthermore, there is no comprehensive post-market monitoring system to detect product failures or adverse events. We are only now, through the transitional WAND (Web-Assisted Notification of Devices) database, starting to compile a product register that will ensure we have the information needed to efficiently and effectively manage the recall of defective or unsafe products.

In this regulatory vacuum it has been necessary for our hospitals to perform a quasi-regulatory role by self-checking the safety and performance credentials of products offered for supply. Once the joint scheme is operative, it will be possible for purchasers to rely on the regulatory approval as an assurance that the product meets the required safety and performance standard as they do now with pharmaceuticals.

The proposed regulatory scheme, consistent with the GHTF framework, will be based on a set of essential principles relating to quality, safety and performance, vigilance requirements and the use of international standards. The new regulations are based on the manufacturers' "intended use" of the medical device and allow for new technologies.

This globally harmonised approach to regulation will allow New Zealand manufacturers and healthcare providers to keep pace with international best practice and maintain a reputation for the production and use of high quality medical devices.

It will also provide a platform to enable New Zealand and Australia to enter into mutual recognition arrangements that help to minimise regulatory costs by avoiding unnecessary duplication of work.

I know Stewart Jessamine has already discussed this with you in his presentation earlier today.

On a positive note, I want to focus now on the benefits of joining forces with Australia to create a world first - a joint regulatory scheme and joint agency to administer both pre-market and post-market regulatory requirements for therapeutic products.

The main benefits of this scheme will be the assurance to both industry and consumers, through the pre-market approval system, that medical devices on the market meet standards consistent with international best practice. Both industry and healthcare providers will also benefit from the post-marketing surveillance system, which will give greater assurance regarding the safety and quality of medical devices in use.

The creation of a comprehensive product register of medical devices will also mean that recall of defective products can be carried out more safely and efficiently.

In creating a single market for products the joint regulatory scheme will facilitate trade, both in the trans-Tasman context and in the wider international arena. It will also strengthen the capacity to meet the challenges of regulating the new wave of innovative technologies - capacity that would be very difficult to build and maintain for New Zealand alone. The flow-on effect of that increased capacity will be more rapid access to new products.

>From day to day I hear and see a lot of misinformed comment about the joint agency and how it will work in practice. My political opponents talk of an Australian take-over and of an unaccountable regulator.

I want to stress that those assertions are far from the truth. These same detractors say we should not form a partnership with Australia but instead go it alone, ignoring the fact that this would impose higher costs on industry.

I want to explain why I am absolutely confident that we are entering into a joint partnership arrangement, not a take-over. Firstly, in terms of the superstructure of the agency - the Ministerial Council and the Board - New Zealand and Australia have an equal voice. There are only two Ministers on the Council -- myself and the Australian Federal Minister for Health and Ageing. It's a 50-50 arrangement.

The five members of the board are appointed on the agreement of both Ministers on the Council. These matters and the role of the Board are all spelt out in the treaty, and can only be changed by agreement of both Governments. The whole scheme has been very carefully designed to ensure that in respect of all material matters, neither country can unilaterally influence its operation. Hence the decision to create a trans-Tasman instrument called Ministerial Council Rules.

These rules will spell out the detail of the scheme -- not only in relation to how medicines and medical devices will be regulated, but also the detail of accountability and governance matters.

This approach guarantees us an equal voice in setting the rules. It also ensures that a common rule book will continue to apply over time by guarding against the divergence that might be expected to occur if such detail was in the implementing bills that have to progress through both Parliaments.

Of course Parliamentary oversight is still retained because the Ministerial Council Rules will be subject to disallowance by either Parliament, and if this happens they will be disallowed in both countries.

A guiding principle in the design of the scheme has been that the agency should be no less accountable than comparable organisations are at present in New Zealand and Australia. This means, for example, that the agency will be required to table an annual report in both Parliaments, and that decisions will be subject to merits review and to judicial review.

Both the Official Information Act and the Australian Freedom of Information Act will apply to the Agency, meaning individuals may request information under either statute. The Auditor-General and the Ombudsman will have oversight of the agency; the so-called "Whistle-blowers Act" will apply; and the list goes on and on.

Another common misconception about the Agency is that its staff will be Australian public servants. I can tell you this is not so! Employment arrangements for staff will be set out in Ministerial Council Rules. Obviously it would be inappropriate for agency staff to be either New Zealand or Australian public servants since they will be serving stakeholders in both countries. There will be a fully functional office in Wellington. Medical device companies will be able to interact with Agency staff in New Zealand when they need advice or regulatory action. In the lead-up to implementation, Medsafe will be taking steps to build capacity and expertise in device regulation so the Wellington office can handle industry queries from day one.

My expectations of the joint agency are quite simple. It must administer a world-class regulatory scheme to protect public safety. It must do so professionally, transparently and cost-effectively and be accountable to the Parliaments, industry and public of both Australia and New Zealand.

In my role as a member of the Interim Ministerial Council I will be working hard with my fellow Council member, Australian Minister Trish Worth, during the implementation phase to make the decisions that are needed to set that course.

After discussions with MIANZ leadership today, I have asked the Ministry of Health to establish a working group of officials and representatives of the association to work through details as it affects the medical devices industry in the joint regulator.

Thank you again for the chance to address your conference. I hope it proves to be a thought-provoking day.

ENDS

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