This company markets a range of 200 plus complementary health care products throughout Australia to health food stores, practitioners and independent distributors. Are Australian owned and operated, and have been operating since February 1981.

This company is part of a globally operating direct sales marketing company specializing in complementary health care products in some forty countries world wide.
This company is a active members of the Direct Selling Association of Australia Inc, (DSAA) the National Herbalists Association of Australia (NHAA) and the Complimentary Health care Council of Australia. (CHC)

We are opposed to the Australian Commonwealth's Government requirement for 100% cost recovery on the basis of it being unjustified, inefficient and not required or needed by the Complimentary Health care industry. In contrast to many direct sales or mufti level marketing competitors, this Australian company strives to comply with all applicable legislation.

The cost of regulatory compliance in Australia is disproportionately high for this Australian company, within the company group, given that in most other markets in which the company operates the products are treated as dietary supplements. But even in other countries with registration requirements the cost is not a great as in Australia.

This cost would be bearable if this Australian company felt they were getting value for money.
Sadly we don't feel we are doing so.
This Australian company market herbs and vitamins.
The average recommended retail price is around $22.78.

In Australia herbal products which are for use in, or in connection with, preventing, diagnosing, curing or alleviating a disease, ailment, defect or injury in persons or animals, or influencing, inhibiting or modifying a physiological process in persons or animals, are considered to be medicines.
Medicines must be recorded on the Australian Register of Therapeutic Goods (ARTG) before they can be supplied (which includes import, export, sale, and advertising).

This is a pre clearance process which has been in operation since 1991. Herbal medicines may be either Listed or Registered. Most are Listed.
In order to be Listed on the ARTG an electronic listing form (ELF) utilising software designed by the Australian Therapeutic Goods Administration (TGA) must be completed by the applicant or applicant's agent.

This self validating form process ensures that the manufacture of the product, including packing, are complying with drug level Good Manufacturing Practice (GMP) and that the ingredients in the product are eligible for use in Australia at the concentration or strength proposed.
Sponsors of Listed medicines are required to posses suitable evidence of efficacy at the time of application and for the duration of the product's life.

The Listing application form, one for each product, records the quantified formula, indications / claims, physical characteristics, storage conditions and shelf life, and commits the applicant / sponsor to specific pharmacopoeial type requirements including label copy. Through the Listing process the sponsor also commits to mandatory flag or warning statements on the label according to the ingredients of the product or the claims made.

Each product, if Listed costs $ 400.00 application fee and an annual fee of $ 350.00, that's a first year listing fee of $ 750.00. Any variation to this product incurs a fee of $ 200.00.
There is provision in the second and subsequent years for exemption status from the annual fee if the product is of “low volume, low value.” ( ie the charge for listing is greater than 6% of the wholesale turnover of the goods.)

A Registered product costs $ 650.00 application fee, an evaluation fee of up to $ 30,000.00 and an annual fee of $ 465.00.

On top of these fees a certificate of Good Manufacturing Practice (GMP) must be produced at the time of the application to ensure that the product is manufactured to GMP Standards.

The GMP certificate for this Australian company costs $ 10,925.00. This amount includes an inspection fee of $ 6,705.00 for a 9 hour audit, the balance being air fares, accommodation and travel expenses.

Yes, we are required to fly a GMP auditor from Canberra to Utah, the United States of America for a nine hour inspection visit. This is required every 18 months. This is simply ludicrous.

Further, because of the complexity of the Registration or Listing process it is not viable for a small company of our size to do our own regulatory management. Our solution is to contract the services of a regulatory affairs consultant thereby incurring additional costs and fees.

Prior to the introduction of the Good and Services Tax , none of our herbal and vitamin products were effected by the Wholesale Sales Tax. Now the consumer pays 10% extra for our products.

Never before have there been so many assaults on our industry and business. There is Government Regulation, the Therapeutic Goods Act compliance costs, advertising guidelines and prohibitions, Good Manufacturing Practices (GMP) compliance costs and now the Goods and Services Tax, which I honestly believe for our industry is a tax upon a tax upon a tax upon a tax. A tax to apply to sell a product, a further tax to register a product for a year, a tax for GMP inspection and now a further 10% GST.
This is ridiculous.

Our objection to 100% cost recovery by the Australian Commonwealth Government for the Complimentary Health care Industry is;

1/ There is too much restriction, prohibition and costs involved with low- risk, trouble free complementary health care products. Australians spend 621 million dollars a year on vitamins, minerals, herbal products, nutritional supplements,
naturopathic and homoeopathic preparations.

2/ The safety and protection of the consumer is disproportionate with the associated costs of Registration or Listing and the present regulatory environment.

3/ The costs incurred by industry members to comply with and contribute 100% cost recovery are anti-competitive and deny consumers access to a full range of cost effective, low risk health care supplements.

4/ With some 18,000 Listed products on the ARTG @ $350.00 per annum, how can any Government body justify 6.3 million dollars to keep a register and infrastructure.

We accept that new applications should attract a fee. But even in the current process applicants do most of the work. We do not accept that past applications which are simply held on a computer record should attract a maintenance fee at the level that we are now paying.

Unless a part of that fee go toward supporting those signifying their compliance with the regulatory system by their ongoing financial contribution through more effectively controlling the non-compliers.

5/ Consumers of complementary health care products are saving the Australian Government money on future health related sickness and illness. Why “penalise” a consumer for actively taking an interest and managing their health care.

6/ Because products are manufactured overseas this Australian company has to pay additionally for inspection of the US manufacturing facility by the Australian inspectorate.

7/ The TGA is not noticeably controlling illegal operations that impact on the business in the direct marketing or direct selling environment. Non-compliant competitors have an advantage in their product costs, and the formulations offered.

9/ It seems that under cost recovery we are only treading water.

10/ Much cost and effort is being put into a 'perfect computer based recording system' to achieve what?
Little more than is achieved now.
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11/ With the introduction of GST this heavily regulated industry with high regulatory compliance costs is receiving no relief. In a sense it is paying twice. At least the TGA fees have been recognised as being tax exempt, but the requirement to pay GST and pay annual maintenance fees takes its toll.

The indirect tax paid on a typical new home now accounts for between 20 and 35 per cent of the total final price of a new house and land package. Exact rate of tax depends on which local government area the development is taking place in.
An equivalent, more visible tax proposal, for say a 30 per cent rate of GST on new housing, would evoke community contempt. But that is the indirect tax bite new home purchasers face and it is getting worse.
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State and local governments have their fingers in the pockets of new home buyers with more than 20 indirect taxes being levied at different stages of the development process and sometimes on top of other taxes. And, then GST is applied to all of the indirect taxes embedded in the residential development, except for stamp duty which is charged on GST. Because all of the GST receipts are paid to the states, state governments are benefiting from a double dipping of indirect tax revenue on new housing.
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HIA estimates that $10.8 billion in indirect taxes (not including land tax and property rates) was levied on new housing in the 2002-03 year, a staggering average of $67,000 per house. Making up the $10.8 billion was $3.1 billion in GST revenues on new housing, nearly $6.4 billion in front-end levies imposed on residential development by state and local governments and $1.3 billion in state government stamp duty on the purchase of new housing.
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Government legislation, all regulations and industry and mining transport costs are also a financial burden.
With a debt free system, all of the above costs will be abolished.
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