Administering the Code of Good Manufacturing Practice for prescription medicines

16 May 2014

This audit assessed the effectiveness of the Therapeutic Goods Administration’s application of the Code of Good Manufacturing Practice for prescription medicines.

Overall conclusion

The Department of Health, through the TGA, administers the Australian regulatory framework for therapeutic goods, providing assurance to the community that prescription medicines, whether of Australian or overseas origin, are manufactured in accordance with a formal Code of Good Manufacturing Practice (Code of GMP). Experience has shown that risks arising during manufacture, such as ingredient substitution or breaches in the quality system, may have potentially serious consequences for patient and public health and therefore require the ongoing attention of manufacturers and regulatory authorities.

The TGA has been generally effective in applying the Code of GMP for prescription medicines manufactured or supplied in Australia. The TGA applies a well‑developed and structured process for licensing and monitoring manufacturing sites in Australia, and has adopted a viable approach to the certification of overseas manufacturing sites, drawing on the work of selected overseas regulators. However, the audit identified a number of shortcomings in the TGA’s administration of the Code of GMP which highlight the need for greater internal discipline and management attention to: strengthen the documentation of key decisions relating to licensing and certification processes; and enhance arrangements for information security and management. There also remains scope to realise the full benefits of TGA initiatives to: reduce duplicated effort in granting clearances for the supply of imported prescription medicine; and implement more equitable cost recovery arrangements.

The TGA licenses Australian manufacturing sites and certifies overseas manufacturing sites against the Code of GMP. These regulatory functions are supported by standard operating procedures (SOPs), providing a good starting‑point for the TGA’s application of the Code of GMP. However, the ANAO’s review of licensing and certification records indicated that TGA staff have not always documented key decisions or consistently maintained inspection files, as required by the SOPs. The TGA should strengthen its quality assurance processes to provide greater confidence that staff formally document key decisions, particularly when discretions are exercised, and maintain complete and accurate records to enhance the transparency and accountability of the licensing and certification process.

The TGA monitors the ongoing compliance of licensed and certified prescription medicine manufacturers with the Code of GMP through a systematic and risk‑based inspection program. The ANAO’s review of inspection documentation indicated that while inspection procedures are mostly followed, there remains scope to refine aspects of the SOPs, which do not require inspectors to record the basis on which they have verified whether corrective and preventive actions identified during previous inspections adequately addressed deficiencies. Further, the timeliness of issuing inspection reports and closing out inspections is well below the TGA’s targets.

Manufacturing sites inspected by the TGA account for only one‑third of sites supplying registered medicines (including prescription medicines) in Australia, with the remainder certified by overseas regulators. All prescription medicines supplied in Australia must have an Australian‑based sponsor, who applies to the TGA for GMP clearance. At present, the TGA processes each clearance application individually, even where other sponsors have recently obtained clearances for the supply of identical products from the same manufacturing site. The OMQ advised the ANAO that approximately two‑thirds of the effort spent processing clearance applications is a duplication of previous work, and it is considering a model to enable the reuse of current evidence of a manufacturing site’s compliance with the Code of GMP in subsequent assessments of the same site. If adopted, this initiative will improve the efficiency of regulatory processes, to the benefit of industry and the TGA.

The TGA undertakes regulation of the Code of GMP on a cost recovery basis. However, the TGA’s current fee structure for regulating compliance with the Code of GMP is such that domestic manufacturers with ‘good’ compliance are cross‑subsidising the effort spent by the TGA to regulate manufacturers with ‘basic’ compliance, as the licence fee is fixed and inspections identifying a high number of deficiencies require considerably more resources to finalise. The TGA has acknowledged there is scope for improvement and advised that it plans to revise fees and charges in 2014–15, pending the outcome of a structural review of fees, charges and activity based costing.

The OMQ operates a Manufacturers Information System (MIS) intended to support the compliance program. However, the MIS does not capture key information required to monitor administrative performance and staff adherence to SOPs relating to the Code of GMP. Further, the compliance information contained in the MIS is not aligned with other TGA information holdings to ensure that publicly accessible information on prescription medicines is current and reliable. More generally, the OMQ has not assessed its IT network security controls against the risk of cyber intrusion. To enhance its operational effectiveness and the security of its data holdings, the OMQ should review its information management arrangements in support of the Code of GMP compliance program, particularly the MIS.

The ANAO has made two recommendations to improve the TGA’s administration of the Code of GMP for prescription medicines, focussing on: strengthening processes for recording key decisions and maintaining inspection files, and refining the quality assurance process to support staff adherence to SOPs; and reviewing information management arrangements to more effectively support the OMQ’s application of the Code of GMP and improve the security of data holdings.

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