Published June 2011
In April 2009, the National Party and the Green Party announced plans to work together to develop a New Zealand-based regulatory system for natural health products that are sold in New Zealand. This RIS considers what functions, powers, and funding mechanisms the regulator might need to operate a regulatory scheme that is cost-effective and gives New Zealanders confidence that the natural health products they use are safe, true to claim and true to label.
This regulatory impact statement (RIS) has been prepared by the Ministry of Health (the Ministry). The options and analysis in this RIS have been informed by a written public submission process, a meeting with representatives of the natural health products industry, and four hui with rongoa Maori providers, practitioners and consumers and representatives of WAI 262 (indigenous flora and fauna) claimants.
There is relatively little information about the number and turnover of natural health products in the market. Some information was provided by a small number of companies through the consultation process. This is insufficient to enable the Ministry to determine accurately the cost of regulation on industry, and particularly at the level of a per product-line charge. Accordingly, estimates presented in this paper on the cost of regulation are very much provisional. Published information suggests that there are around 6,600 products in the New Zealand market, however, a small industry group has submitted that the number could be as high as 20,000. At the lower end of estimates, the regulatory scheme may be unviable as industry would be unlikely to be able to sustain the costs. It is proposed that a regulatory scheme would have a transitional period that would enable the regulator to collect accurate information on the products in the market, on which subsequent fees and levies can be based.
Earlier work has aimed to establish a joint therapeutic products regulator with Australia, which would have included complementary medicines (natural health products). As the New Zealand Government has proposed to Australia that officials negotiate the establishment of a joint regulator (with an exclusion for natural health products in the New Zealand market), this option has not been considered in this analysis. The Government has, however, indicated to Australia an interest in progressing discussions on the establishment of the joint regulator. There are elements of the preferred option for New Zealand’s regulatory scheme for natural health products that we know are inconsistent with Australia’s preferences. This will need careful management if the Government wishes to realise a joint therapeutic products regulator (with an exemption for natural health products in the New Zealand market).
Deborah Roche, Deputy Director-General, Strategy and System Performance, Ministry of Health