Medicines Act, 1968 (Hansard, 1 July 1971)

§ Sir K. Joseph

In April last a memorandum on fees to be charged in connection with licences and certificates under the Medicines Act was sent to bodies representative of the interests concerned as a basis for consultation. This document envisaged a scale of fees intended to collect about £750,000 a year, which was estimated to be the full cost of the operation of the licensing system. The fee structure was on a flat rate basis including a unit fee of £15 for each branded product.

The main points made in comments received on these proposals included the following: (1) There was strong objection to the total amount to be paid, and to the principle of collecting the whole cost, including criticisms of the "open ended" nature of an arrangement under which the full cost of expenditure in this field would fall on fees. (2) Most of the bodies concerned demurred at a distinction between branded and un-branded products. (3) Bodies representing smaller firms maintained that the flat rate basis imposed an unduly heavy burden on such firms.

In the light of these comments and of discussions with the bodies concerned the Health and Agriculture Ministers have reviewed the whole question and have reached the following conclusions: 1. The definition of activities constituting the cost of licensing should be narrowed by excluding:

(a) those activities which represent a continuation of work hitherto carried on under the Therapeutic Substances Act, 1956 and the Diseases of Animals Act, 1950.
(b) One fifth of the cost of the staff supporting the two Committees which are concerned with advising the licensing authority. This work represents a continuation of the work hitherto carried on by the corresponding Committees under the voluntary scheme.

As a result of these adjustments the estimate of the full cost of the administration of licensing is reduced to about £500,000 a year. Before any expansion of the scope of work falling within this revised definition there would be full consultation with the interested bodies. 2. The initial scale of fees should be such as to recover about £300,000 a year. At future reviews it will be the objective to bring the receipts into line with the full costs as defined in the foregoing paragraph. 3. The scale of fees should recognise the position of the smaller firms and be such as to avoid placing excessive burdens on them. In accordance with these decisions amended proposals will be put to the interested bodies about the detailed provisions to be included in the fees regulations.