Natural Health Products Bill (Bill) is set to establish a dedicated, risk-based regime for regulating natural health products in New Zealand. The Bill underwent its first reading on 15 September and will be considered by the Health Select Committee in the coming months. If passed in its current form, the Bill would impose arbitrary and excessive regulatory control on natural health products. The regulatory burden imposed will be out of all proportion with controlling what the Bill itself describes as "low-risk" natural health products.

In this FYI, we outline:

  • the reasons for the new regime;
  • the new regulator proposed under the Bill;
  • the new rules for importers and manufacturers of natural health products; and
  • where to from here – how you can voice your concerns about the Bill.

WHY NATURAL PRODUCTS? WHY NOW?

Reasons for the new regime

Currently, most natural health products are regulated as dietary supplements under the Dietary Supplements Regulations 1985 or supplemented foods under the New Zealand (Supplemented Food) Standard 2010 (Current Scheme). The Bill addresses perceived deficiencies in the Current Scheme by proposing a regulatory regime that intends to "give New Zealanders confidence that the natural health products they use are safe and true to label". The Bill will govern the actions of all "sponsors" of natural health products – New Zealand residents who "import or manufacture, or arrange the import or manufacture of, a natural health product".

In proposing such a comprehensive reform, the Government has assumed that there are problems with the Current Scheme, and that those problems can be remedied by replacing the allegedly piecemeal and outdated regime with a new one. The proposed regime will catch a broad range of natural health products, including:

  • dietary supplements, vitamins and multi-vitamin preparations;
  • herbal remedies;
  • some cosmetic products;
  • homeopathic medicines; and
  • aromatherapy products.

YET ANOTHER REGULATOR?

The Natural Health Products Regulatory Authority

The Bill creates a regulator within the Ministry of Health called the Natural Health Products Regulatory Authority (Authority), which will administer the new regime. The Authority will:

  • have powers to set labelling requirements, manufacturing standards, and standards for making health benefit claims;
  • assess the safety of new natural health product ingredients and evaluate the evidence of their claimed health benefits;
  • maintain a database of natural health products and a list of approved and prohibited ingredients for manufacturing natural health products; and
  • remove non-compliant natural health products from the database and revoke or suspend manufacturing licences if it believes a sponsor is contravening the Bill or the regulations made under it.

WHAT DOES IT ALL MEAN?

New rules for importers and manufacturers of natural health products

Natural Health Products

The Bill defines "natural health product" as a product that contains only low-risk natural health product ingredients intended by its sponsor to be administered to humans and bring about a health benefit. The definition excludes food and prescription or pharmacy-only medicines.

Notification

All sponsors of natural health products that will be distributed in New Zealand will need to notify the Authority before releasing their products onto the market. A sponsor must provide information to the Authority about the name and details of the product, the sponsor, the manufacturer, the health benefit claims made for the product, and any other information prescribed under the regulations to the Bill.

Labelling, ingredients and safety

All natural products distributed in New Zealand will have to comply with labelling requirements set out by regulations issued by the Authority under the Bill. Under the Current Scheme, any vitamin or mineral can be added to a product provided it is safe and suitable for purpose. In contrast, the new Bill proposes a 'white' list of specifically approved ingredient classes. To be used in New Zealand, new ingredients will need to fit within these ingredient classes or be approved by the Authority. The Bill also proposes a 'black' list of prohibited ingredients that cannot be used as ingredients in natural health products.

Having both an approved ingredients list and a prohibited ingredients list is impractical because it requires every new substance falling outside the listed classes to be assessed and declared either safe or unsafe. If a sponsor submits a natural health product that contains a new ingredient for notification under the Bill, the Authority may request that the sponsor provide evidence about the safety of the new ingredient.

Assessing new natural health product ingredients is also likely to be unmanageable from a regulatory standpoint – the Authority may not be able to keep up with the rate of natural health product development. Allowing only approved ingredients may make it economically unviable for sponsors to introduce new products – containing new ingredients – into New Zealand at all, and provides little incentive for innovative natural health product development.

Licensing

All manufacturers of natural health products will need to apply for a licence to manufacture under the Bill. A licence will only be issued if:

  • the applicant's manufacturing facilities meet the requirements of a Code of Practice issued by the Authority under the Bill;
  • the applicant is considered a "fit and proper person" to hold the licence; and
  • the applicant complies with the Code of Practice at all times.

Offences, sanctions and penalties

The Bill creates new, consumer-focussed offences for intentionally deceptive behaviour. Deceptive behaviour includes falsification, alteration and misrepresentation of natural health product labelling. Creating new offences for misleading or deceptive labelling of natural health products ignores the fact that existing laws (including the Fair Trading Act 1986 and Advertising Standards Authority Codes) sufficiently cover such claims.

Sanctions include product recall and prosecution. The Bill imposes hefty financial penalties for individuals or bodies corporate who contravene it – for the most serious offences, up to $500,000 for bodies corporate and $50,000 or 5 years imprisonment for individuals.

Transition period

The Bill provides for a staggered transition period which is intended to help the natural health products industry adjust to the proposed regime. For products that are compliant under the new scheme, the Bill allows one year for completing product notification, two years for meeting labelling requirements, and three years for meeting manufacturing requirements.

WHERE TO FROM HERE?

Voicing your concerns

Under the guises of modernisation and harmonisation, the Bill proposes significant reform. We suggest you make your views heard by making a submission to the select committee or lobbying your local MP. The Health Select Committee is due to report back on 20 October, but this is likely to be a default date to coincide with the dissolution of Parliament before the general election. As submissions to the Health Select Committee have yet to be called for, we do not expect the report to be released until well after the election in November.

If you share our concern that an excessively technical and heavy-handed "risk-based" regime is unnecessary to regulate supposedly "low risk" natural health products, we can help. Contact us for assistance in preparing a submission or to discuss the practical effects the Bill might have on your business.