Today’s correspondent says:

I was hoping you could clarify some points of concern for me. I have recently come across a post in the … Facebook group discussing pharmaceutical licensing by state governments. This in turn ignited a fierce debate in one of the private chat rooms about state health organisations getting around the TGA rules.

We, as a private provider in NSW have to apply to NSW Health Pharmaceutical unit to obtain a license and permits to purchase, store and administer various medications. I assume this system is very similar in other states. We can only request to have medications on license that have been approved for registration by the federal government’s TGA [Therapeutic Goods Administration].

It is my understanding that state health organisations do not have to abide by this rule and can use certain medications that are not approved by the TGA, intranasal fentanyl for example.

Now that our business is struggling due to CoVID19, I find it especially frustrating that government ambulance services can freely compete with small businesses for the same commercial contracts. In the case of NSW Ambulance for example, they have been given generous exemptions in every aspect of registration and licensing for medication and are also overly represented in the management of various industry groups and regulatory committees.

The questions I bring to you are two different aspects of this.

  1. Why are state ambulance services exempted from complying with these rules?
  2. What’s the point of rules and regulations if most of the industry does not have to comply with them?
  3. How can a publicly funded service, which enjoys these generous exemptions in various fields, bid for the same tenders and take commercial work away from small businesses? Is that not rather unethical?

We know that everyone needs an authority to possess, supply and/or administer a scheduled drug (The last word on scheduled drugs? (September 29, 2019)) and yes that scheme is consistent across Australia.

The Therapeutic Goods Act 1989 (Cth) makes provisions for how drugs are approved and listed for use.  Drugs may be prescribed for ‘off label’ use. The TGA says:

Off-label prescribing refers to the use of a registered medicine outside of the indications, dose, route of administration or patient group set out in the TGA-approved Product Information (PI).

The TGA is responsible for ensuring that medicines available for supply in Australia are safe and fit for their intended purpose. The approved indications, as described in the medicine’s PI, have been evaluated for safety and efficacy by the TGA.

The TGA recognises that off-label prescribing may be clinically appropriate in some circumstances, but recommends that such use only be considered when other options are unavailable, exhausted, not tolerated or unsuitable.

Prescribers should discuss the risks and benefits of the proposed treatment with the patient and/or their carers so that they are capable of providing informed consent.

Additionally, the treatment, including its effectiveness and potential adverse events, should be monitored.

In situations where the PI for a medicine is updated in a way that makes continued use ‘off label’, the patient should be informed so they can participate in the decision regarding treatment options.

Intranasal Fentanyl does not appear to be something out of the ordinary; see

Nor does it appear to be ‘off label’:

The NSW government, along with all Australian governments, has adopted the principles of competitive neutrality.  They say (NSW Policy Statement on the Application of Competitive Neutrality (2002), p. 23):

The objective of competitive neutrality policy is the elimination of resource allocation distortions arising out of the public ownership of entities engaged in significant business activities: Government businesses should not enjoy any net competitive advantage simply as a result of their public sector ownership.

That policy statement sets out general pricing guidelines to ‘ensure that goods and services sold in contestable markets are costed and priced in a competitively neutral manner’ (p. 14).

Discussion

I can see nothing in the Therapeutic Goods Act and its various regulations nor state poisons laws that suggests that state ambulance services enjoy any exception to the rules.

There is however a clear difference between NSW Ambulance and private providers. First NSW Ambulance maintains a monopoly on responding to triple zero emergency calls. Therefore, NSW Ambulance has to have a capacity to respond to emergencies affecting the entire NSW community, people of all ages, of all backgrounds and all manner of emergencies. This may not be true of private providers depending on their area of operations. It may be that NSW Ambulance paramedics have a clinical need for some drugs that other providers do not.

NSW Paramedics can carry any drugs that the Secretary of Health authorises (Poisons and Therapeutic Goods Regulation 2008 (NSW) r 101 (with respect to schedule 8) and Appendix C, cl 7 with respect to schedule 2, 3 and 4 drugs). (Note that the Regulation refers to the Director-General of Health, but that title has been dropped and the relevant office is now the Health Secretary (Statute Law (Miscellaneous Provisions) Act (No 2) 2015 (NSW), Government Sector Employment Act 2013 (NSW) and Health Administration Act 1982 (NSW) s 8).  A private provider also has to have the approval of the Health Secretary  to be authorised to possess, supply or administer a scheduled drug (Poisons and Therapeutic Goods Regulation 2008 (NSW) r 170).  The second major difference between NSW Ambulance and private providers is that the Health Secretary runs and is responsible for NSW Ambulance (Health Services Act 1997 (NSW) s 67A). No doubt that gives the CEO of NSW Ambulance direct access to the Health Secretary and to the relevant head of the pharmaceutical branch of NSW Health so it may be easier for NSW Ambulance to get approvals to allow NSW ambulance paramedics to carry drugs that the CEO has determined would better improve their service. But at the end of the day, everyone needs the Health Secretary’s approval.  There is no exemption for NSW Ambulance.

Conclusion

I was asked:

  1. Why are state ambulance services exempted from complying with these rules?
  2. What’s the point of rules and regulations if most of the industry does not have to comply with them?
  3. How can a publicly funded service, which enjoys these generous exemptions in various fields, bid for the same tenders and take commercial work away from small businesses? Is that not rather unethical?

My answers are:

  1. I can see no evidence that state ambulance services are exempted from complying with the rules set by, or under, the Therapeutic Goods Act 1989 (Cth) or state poisons legislation.
  2. In light of my answer to question 1, question 2 is irrelevant.
  3. State government services are expected to bid for commercial work in a way that is consistent with the competitive neutrality principles that have been adopted by all Australian governments. I cannot say whether NSW Ambulance does that but there are complaint procedures if someone wants to allege that they have failed to do so.