Consultation submission: The Scheduling Policy …...Fusion C4.02, 22 - 36 Mountain Street, Ultimo...

Regulatory Reforms Team Therapeutic Goods Administration PO Box 100 WODEN ACT 2606

Dear Madam/Sir

,., accord hygiene, cosmetic & specialty products industry

Accord Australasia is pleased to provide a submission on the Consultation: The scheduling policy framework and advertising of pharmacists-only medicines (Schedule 3 substances) (SPF consultation).

Accord is the peak national industry association representing the manufacturers and marketers of formulated hygiene, cosmetic and specialty products, their raw material suppliers, and service providers. Accord member companies make and/or market fast-moving consumer and commercial goods including hygiene, cosmetics and specialty products, sunscreens, food contact sanitisers, industrial and agricultural sanitisers, household pesticides, disinfectants and specialty commercial products. Member companies include large global consumer product manufacturers as well as small dynamic Australian-owned businesses with 80 percent of members operating as SME (<200 employees). A list of Accord member companies is available on our website http://accord.asn.au/about/members/.

Headline statistics1 for our industry's economic footprint include: • Estimated annual retail-level sales of industry products nudging the $10 billion mark. • Accord's membership is approximately 100 companies. • Collectively, Accord member companies directly contribute more than 15,000 full-time equivalent

jobs. • Nationally, more than 180 offices and more than 60 manufacturing sites are operated by Accord

member companies.

We understand that the SPF consultation is addressing recommendations 11 and 12 of the Expert Panel Review of Medicines and Medical Devices Regulations (MMDR). Accord comments will focus on those aspects of the consultation addressing recommendation 11 (recommendation 12 is for Schedule 3 substances):

"The Panel recommends that the Scheduling Policy Framework be reviewed, in consultation with the State and Territory Governments, to provide for:

1. The development and adoption of a formal risk-benefit methodology to assess scheduling applications; and

2. Opportunities to enhance input from interested parties into the scheduling process.

The Scheduling Policy Framework (SPF), document that is managed by the Commonwealth and all States and Territories via the Australian Health Ministers Advisory Council (AHMAC)"

Accord also notes that this SPF consultation will not address implementation of GHS, as it is considered out of scope. We support this decision, as we believe that an in-depth analysis of the impact of GHS on the scheduling system, as well as detailed consultation is required before such implementation can be considered. It must be recognised that the scheduling system encompasses medicines, agvet chemicals and cosmetics as well as other consumer products and some industrial use chemicals. As such, it is not appropriate to attempt to superimpose GHS on the current scheduling system.

1 Results from Accord Industry Size and Scale Survey 2016

Accord Australasia Limited ACN 111 659 168 ABN 83 205 141 267 Fusion C4.02, 22 - 36 Mountain Street, Ultimo NSW 2007

PO Box 290 BROADWAY NSW 2007

Tel : 61 2 9281 2322 Fax: 61 2 9281 0366 Website: www.accord .asn.au

Products for healthy living and a quality lifestyle

,.,accord

Accord's detailed comments are provided in the attached document, Attachment 1.

We thank you for this opportunity to provide co submission, please do not hesitate to contact me a

Yours sincerely

Bronwyn Capanna Executive Director

� May 2017

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our

"'accord Attachment 1

Consultation: The scheduling policy framework and advertising of pharmacist - only medicines

Accord would like to re-iterate the comments we have provided to the Scheduling Policy Framework (SPF) review in our previous submission dated 15 December 2016. For ease of reference, this submission is provided as attachment 2.

In terms of the matters raised in the TGA's consultation paper, Accord provides the following -

Chemical Scheduling Policy Issues

Transparency of regulatory decision making - articulation of issues and need for regulation

As you are aware, while Accord is broadly supportive of the scheduling system, Accord has been critical of the current underlying scheduling policy which applies the same scheduling decision to a wide range of chemicals without considering the risks and benefits of each of the chemicals or uses. This is through capturing "salts and derivatives" of scheduled chemicals, and having a very broad and ambiguous definition of derivatives. These chemicals may have varying toxicological profiles and a wide range of uses.

The current scheduling decision making process does not clearly identify the issues nor articulate the need for regulation for those substances that are captured as "salts and derivatives" and therefore is not transparent.

It is also contrary to the Australian Government's Best Practice Regulatory Principle, which states that regulation should only be made when there is a proven need.

This approach to risk management decision making potentially relies on false assumptions such as: • a substance used as a medicine has the same risk profile when used in other applications e.g.

industrial uses, agvet use, etc., and

• a substance has the same risk profile as a scheduled substance because it is a salt or a "derivative" of that substance.

In our submission dated 15 December 2016, through examples, we have shown that often these assumptions are false. We have also shown the significant issues caused by this underlying scheduling assumption, and the onus on industry to prove that the "derivative" not only does not have the same risk profile as the initial substance considered for scheduling, but is "safe" before the scheduling controls are removed or modified.

This is an overly burdensome approach to regulation for all stakeholders.

While we understand that a broad "catch all" definition may be useful in certain circumstances e.g. control of synthetic cannabinoids, we believe it should be more specifically targeted. One option is to apply derivatives definition to certain schedules only e.g. schedule 8. Another option is a better definition of "derivatives" in the Poisons Standard itself and a guidance document detailing the factors to be considered when deciding whether a substance is a derivative of a scheduled substance.

Consistency with other regulations and recognition of technological progress

Impurities

Accord is concerned that the Poisons Standard does not recognise the technological progress that has been made over the past few decades, and is potentially out of step with other regulatory requirements. For example, the technology of detecting impurity levels is such that extremely small (ppb levels and below) amounts of certain impurities can be detected - it is simply a matter of cost. The Poisons Standard

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i,Jaccord does not allow even the smallest detectable level of impurities for substances that are in schedules 7 and 8. This is a significant problem where these substances can be present in small quantities as a manufacturing by-product or residual raw material. Also, there is no guidance for industry on what detection method should be used. There is a need to address this.

For medicines, we understand that the TGA accepts pharmacopoeia monograph for ingredients, including low levels of impurities that may be included in schedules 7 or 8. It is not a sound risk management practice to allow schedules 7 or 8 substances in medicines as impurities but not in other uses such as cosmetics or household cleaning products.

Also, the Poisons Standard applies the same level of impurity cut-off for all substances that are in schedules 1 to 6, by exempting small quantities of schedule 1-6 substances from scheduling. While this clause is intended as an exemption for low concentrations of scheduled substances, in practice, it is utilised as an impurities cut-off level due to lack of other overt scheduling policy on impurities. This is not appropriate. A number of common raw materials can be supplied in a range of purity grades e.g . analytical grade, food grade, cosmetic grade or pharmaceutical grade. These distinctions recognise that depending on the use, different levels of impurities are acceptable, and purification processes can be modified to reflect this. It must be noted that it is almost impossible to achieve a 100% pure substance, and the closer it is to 100% pure, the more expensive the purification process and therefore the cost of the substance.

This "one size fits all" approach of expecting the same level of impurity (or no impurities at all) for medicines and semi-industrial products such as paints, sealants, etc. does not deliver the best risk management outcome. There is no benefit in requiring a medicine level purity of ingredients for industrial chemicals, but there can be a significant cost associated with the requirement.

Noting that for medicines the acceptable level of purity is already set by pharmacopoeia monograph for ingredients, and in practice this is acceptable even if the ingredient is a scheduled substance, a practical solution may be to have an overt impurities policy which allows impurities to the lowest practical level for all scheduled ingredients. This is the approach taken in the EU Cosmetics Regulations for cosmetics. This would be a separate clause to exempting small quantities of schedule 1-6 substances from scheduling.

Consistency of regulatory controls and hierarchy

While we note that this may be outside the scope of this review, there is a need for coordination between all regulatory agencies for consistent regulatory control of scheduled substances. As a minimum there needs to be a hierarchy established for regulatory controls where different regulators impose them.

Accord is aware of cases where the risk management considerations and decisions of the ACCS, an expert committee, and the Delegate of the Secretary of the Department of Health with expertise in the topic area have been largely ineffective due to arbitrary decisions made by other regulatory agencies.

One such example is the use and supply of hydrogen peroxide for teeth whitening by a registered dental practitioner - while the Poisons Standard allows professional judgement and discretion of the registered dental practitioner for products containing more than 6% hydrogen peroxide ( or 18% carbamide peroxide), the ACCC does not. Another broader example is where NICNAS sets a limit on substance concentration e.g. for a fragrance substance through its new or existing chemicals assessment process but a different control is set in the Poisons Standard, or no risk management control is considered necessary.

While these issues do not necessarily sit within the scope of Chemical Scheduling, we believe this regulatory overlap and confusion must be addressed to ensure that we continue to have effective and efficient chemical management system in place.

SPF CONSULTATION RECOMMENDATIONS

Split the SPF into a Policy Document and a Guidance Handbook

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,.,accord Accord supports the separation of the current SPF into policy and guidance components and believes that this will increase clarity for users of the system and provide for a sharper focus in relation to the respective aspects of the framework.

Accord notes that the policy component of the SPF will remain the responsibility of the Australian Health Ministers Advisory council (AHMAC). However, concern still exists as to how a transparent and timely approach to SPF policy amendments will be facilitated in the absence of a dedicated body with direct policy oversight for the framework.

Establish an Informal Working Group to Provide Advice on Possible Amendments to the SUSMP

Accord supports the maintenance of the proposed SPF handbook by the Scheduling Committee Secretariat.

While we are supportive in principle of the establishment of a working group that consists of relevant stakeholders, for this to be an important addition to support the effectiveness and transparency of the policy framework, some formal structure must be in place. This could include a terms of reference and documentation around governance, e.g. how a working group is to be established, what types of amendments can be considered, what factors can/should to be considered when providing advice, status if the advice and how this advice will feed into the broader scheduling consultation and consideration.

Applicants Presenting to the Advisory Committee

Accord supports conducting a pilot exercise to assess the value of applicants presenting directly to the respective advisory committee to enhance clarity and transparency around the scheduling process.

Structure and Content of the Committee's Advice

Accord would like to re-iterate its previous concerns relating to the current negative impacts of the cascading principle in making scheduling recommendations. This approach starts with the assumption of need for higher regulatory control, with justification required to reduce regulatory intervention. This is contrary and opposite to the Australian Government's Best Practice Regulation Guidelines, which recommends regulation as the last rather than the first option.

Decisions around the scheduling of substances must be based on robust risk assessment and management principles. There are inherent differences between the risk profiles of chemicals used in the domestic and industrial settings, and medicines. Unintended impacts result when active constituents are dealt with in a manner that does not consider the specific risk profiles of individual substances when used in the industrial or domestic setting.

For both chemicals and medicines, clear articulation of the proposed use patterns of substances is needed as part of the scheduling considerations to ensure proper and appropriate risk management consideration. This can be achieved in a number of ways including clearer definitions of substances and derivatives, and/or by listing the substance by name and CAS number and only applying controls to the identified substance.

Proper risk-benefit assessments cannot be undertaken when the substances' identity is not known and the full range of use patterns has not been identified. A common example of this is where all salts and derivatives of a substance are included in the schedule entry and the scheduling consideration has been limited to the toxicological and use pattern of the substance itself.

An example of this is the inadvertent capture of an ingredient that is used in a topical cosmetic in schedule 4 because it is a salt of a substance that is included in schedule 4 as an injectable medicine.

The scheduling decisions of the Delegate are legislative in their nature and as such, the Australian Government Best Practice Regulation Guidelines should apply. An important aspect of this is the consideration of regulatory impact and this cannot be satisfactorily addressed when the scope of the regulatory decision has not been clearly identified.

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~accord Public Summary of the Scheduling Submission and Other Communication Processes

Accord supports any measures that will increase the transparency of the processes and the provision of relevant information to stakeholders concerning scheduling decisions. However, Accord's comments relating to the structure and content of the committee's advice as detailed above must be addressed prior to the implementation of any revised public summaries and associated communication processes.

These processes are inherently linked to the requirements to clearly identify the substance subject to a scheduling consideration and its patterns of use.

Greater Emphasis on Benefits as well as Risks

Accord supports a process where guidance documentation for the SPF includes information that submissions should detail the overt benefits of the proposed re-scheduling of substances. For consumer products, consideration of benefits need to include economic benefits and benefits to consumers through increased choice and lifestyle improvements, not just health benefits.

The use of a formal risk-benefit methodology may be of benefit in relation to the preparation of rescheduling submissions. However, a tool such as this should allow for different uses of chemicals as well as different risks and benefits to be considered , and only be considered for the purposes of guidance and not a process that is mandatory in terms of preparing submissions.

Public Consultation of Interim Decisions

Accord supports amending the Therapeutic Goods Regulation to allow wider public consultation and the receipt of submissions from any interested parties relating to interim decisions. Flexibility in relation to timelines for responding to interim decisions should also be incorporated into any amended process.

Guidance of Legal Nature of Scheduling and Scheduling Decisions

Accord supports the inclusion of a plain English explanation in the proposed guidance documentation relating to the legal nature of scheduling and information on the legal implementation of scheduling decisions.

Consider a Chemicals Scheduling Delegate within the APVMA

Accord supports the timely access to market for agricultural and veterinary chemicals. However, in terms of establishing a separate delegate within the APVMA, there needs to be clear boundaries around the scope of any such decisions. In broad terms, scheduling decisions made by a delegate within the APVMA would have to be limited to new chemical substances where the pattern of use is for agricultural or veterinary purposes.

This could be achieved if there is a clear articulation of the substance and the use pattern of the substance for the decision i.e. the decision included in the Poisons Standard should include the words "for agvet use" and "excluding salts and derivatives". It is an approach that Accord recommends for all scheduling considerations (see our comments under Chemical Scheduling Policy Issues).

Decision Transparency and Information Sharing

Inclusion of an explanation of jurisdictional control requirements that enhance stakeholder understanding of the scheduling decisions is supported by Accord.

Mechanisms that facilitate the longest possible timeframes around activities associated with scheduling decisions, particularly recognition that there are practical ramifications for industry to implement those decisions, are also supported, as is a process to facilitate early information sharing between the scheduling secretariat and the APVMA.

Proactive Identification of Substances for Re-Scheduling

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'-'accord Accord is unsure how this proposal will be implemented. It is a broad proposal, with little information on how it would be facilitated. While Accord is supportive of allowing some flexibility for internal identification of issues within the current Poisons Standard e.g. inconsistencies between different schedule entries, we would like to understand how a proper consultation process for these substances will be managed.

Improving the Clarity of the SPF

Accord does not agree with the proposal to expand the types of decisions that the delegate will have the discretion to refer to the scheduling committees. Under the revised scheduling arrangements, the intent of allowing delegate-only scheduling decisions was to reduce the timelines around the registration of new prescription medicines.

The reasoning around limiting the scope of discretionary decision-making by the delegates was that decisions relating to re-scheduling and the content of Appendices have implications for and can produce inconsistencies with State and Territory medicines and poisons controls.

Specifically, Accord does not agree with nor support the extension of discretionary decision-making in relation to any of the examples listed under this Business Improvement Measure.

As previously mentioned, the extension of any discretionary decision-making concerning agricultural and veterinary chemicals should be limited in its scope of application.

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Accord Australasia Limited ACN 117 659 168 ABN 83 205 141 267 Fusion C4.02, 22 – 36 Mountain Street, Ultimo NSW 2007

PO Box 290 BROADWAY NSW 2007

Tel: 61 2 9281 2322 Fax: 61 2 9281 0366 Website: www.accord.asn.au

Products for healthy living and a quality lifestyle

SPF Review Department of Health and Ageing GPO Box 9848 CANBERRA ACT 2601

Dea Accord Australasia is pleased to provide a submission on the Scheduling Policy Framework review (SPF review). Accord is the peak national industry association representing the manufacturers and marketers of formulated hygiene, cosmetic and specialty products, their raw material suppliers, and service providers. Accord member companies make and/or market fast-moving consumer and commercial goods including hygiene, cosmetics and specialty products, sunscreens, food contact sanitisers, industrial and agricultural sanitisers, household pesticides, disinfectants and specialty commercial products. Member companies include large global consumer product manufacturers as well as small dynamic Australian-owned businesses with 80 percent of members operating as SME (<200 employees). A list of Accord member companies is provided at Attachment 1. Headline statistics1 for our industry’s economic footprint include:

Estimated annual retail-level sales of industry products nudging the $10 billion mark. Accord’s membership is approximately 100 companies. Collectively, Accord member companies directly contribute more than 15,000 full-time equivalent

jobs. Nationally, more than 180 offices and more than 60 manufacturing sites are operated by Accord

member companies. We are pleased to note that the focus of this review is aimed at achieving true reform, where benefits are delivered for all stakeholders. We support the concept of a more streamlined process and reducing red-tape while improving transparency of decisions and the decision-making process. Attachment 2 addresses specific reform options that were raised for consideration at the Chemical Stakeholder meeting in Canberra on 22 November, including improving transparency, amendments to the SPF and application of GHS in scheduling considerations. There are other Chemical Scheduling policy issues of importance to industry that were not discussed in depth at the Stakeholder consultation. One of the issues is ensuring that regulatory decisions on risk management are deliberate and are applied to identified risks. As you are aware, we have been critical of the current process where a substance can be considered as a prescription medicine, but the decision can capture the same substance used in other contexts including industrial processes. This is not appropriate risk management decision making and it relies on potentially false assumptions that a substance used as a medicine has the same risk profile when used in other applications.

1 Results from Accord Industry Size and Scale Survey 2016

~ accord Further details on the above and other issues identified as being of significant importance to industry, and our suggestions on potential solutions are provided at Attachment 3. Please note that the examples provided in Attachment 3 are not exhaustive and are simply used to highlight the issues. We are happy to provide further examples if required.

We thank you for this opportunity to provide comments. please do not hesitate to contact me a

Yours sincerely

Catherine Oh Manager, Regulatory & Technical

15 December 2016

Page 2 of23

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Attachment 1

Accord Members Consumer, Cosmetic and Personal Care Advanced Skin Technology Pty Ltd Amway of Australia Pty Ltd AVON Products Pty Limited Beiersdorf Australia Ltd BrandPoint Pty Ltd Chanel Australia Clarins Group/Trimex Pty Ltd Clorox Australia Pty Ltd Colgate-Palmolive Pty Ltd Combe Asia-Pacific Pty Ltd Cosimer Pty Ltd Cosmax Prestige Brands Australia Pty Ltd Coty Australia Pty Limited De Lorenzo Hair & Cosmetic Research Pty Ltd Edgewell Personal Care Elizabeth Arden Australia Emeis Cosmetics Pty Ltd Estée Lauder Australia Frostbland Pty Ltd GlaxoSmithKline Consumer Healthcare Hairjamm Pty Ltd Helios Health & Beauty Pty Ltd Henkel Australia Pty Ltd Hypred SAS Inglot Cosmetics Pty Ltd iNova Pharmaceuticals – A Valeant Company Integria Healthcare (Aus) Pty Ltd International Beauty Supplies Pty Ltd Johnson & Johnson Pacific

KAO Australia Pty Ltd Keune Australia Kimberly-Clark Australia La Biosthetique Australia La Prairie Group L’OCCITANE Australia Pty Ltd L'Oréal Australia Pty Ltd LVMH Perfumes and Cosmetics Mary Kay Cosmetics Pty Ltd Muk Haircare Pty Ltd Natural Australian Kulture Pty Ltd Nutrimetics Australia NYX Pty Ltd Pacific SMM Pty Ltd Panamex Group Pierre Fabre Australia Pty Ltd Procter & Gamble Australia Pty Ltd PZ Cussons Australia Pty Ltd Reckitt Benckiser Revlon Australia SC Johnson & Son Pty Ltd Scental Pacific Pty Ltd Skin Health Pty Ltd Syndet Works Pty Ltd The Heat Group Pty Ltd Ultraceuticals Unilever Australasia Vitafive Weleda Australia Pty Ltd

Commercial/Hygiene & Specialty ProductsA S Harrison & Co Pty Ltd Albright & Wilson (Aust) Ltd BP Castrol Australia Pty Ltd Brenntag Australia Pty Ltd Castle Chemicals Pty Ltd Chemetall (Australasia) Pty Ltd Clariant (Australia) Pty Ltd Crisp Solutions Deb Australia Pty Ltd Dominant (Australia) Pty Ltd Ecolab Pty Limited E.D. Oates Pty Ltd Huntsman Corporation Australia Pty Ltd Lab 6 Pty Ltd

Novozymes Australia Pty Ltd Nowra Chemical Manufacturers Pty Ltd Peerless JAL Pty Ltd Recochem Inc Rohm and Haas Australia Pty Ltd Schulke Australia Pty Ltd Solvay Interox Pty Ltd Sopura Australia Pty Ltd Symbio Australia Pty Ltd Tasman Chemicals Pty Ltd Thor Specialties Pty Limited True Blue Chemicals Pty Ltd Whiteley Corporation Pty Ltd

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Associate Members

Corporate Travel Services

Platinum Travel Corporation

Graphic Design and Creative

Ident Pty Ltd

Legal and Business Management

DibbsBarker

FCB Lawyers

K&L Gates

KPMG

TressCox Lawyers

Logistics

Bolloré Logistics Australia Pty Ltd

Recruitment

On Q Recruitment Pty Ltd

Regulatory and Technical Consultants

Apitton Scientific Consulting

APPharma Pty Ltd

Clare Martin & Associates Pty Ltd

Competitive Advantage

Davoren Environmental Pty Ltd

Engel, Hellyer & Partners Pty Ltd

Robert Forbes & Associates

Seren Consulting Pty Ltd

Sue Akeroyd & Associates

Tudor Chem Pty Ltd

UL International Australia Pty Ltd

Specialist Laboratories and Testing

Dermatest Pty Ltd

D.Lab Solutions Pty Ltd

Eurofins ams Laboratories Pty Ltd

September 2016

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Attachment 2

1. Improving transparency and accountability Accord supports the discussions at the Chemical and Medicine Stakeholder meetings to improve the transparency of the scheduling process. We are supportive of:

More information at the beginning of the consultation process (we have additional comments on deliberate regulatory decision making that are also relevant to this discussion – please see our comments in Attachment 3, points 1 and 2),

Publication of the logic (including key information that influenced the thinking process) used by the advisory committees in reaching the recommendation to the Delegate, and the logic used by the Delegate in reaching the final decision,

Allowing comments to be made after the Interim Decision by the Delegate (by stakeholders that did not provide comments prior to the Interim Decision being published),

Having just one consultation for a substance in certain cases e.g. where the decision is not likely to be controversial, a public consultation can occur after the Delegate’s Interim Decision, and

Longer consultation timeframe after the Delegate’s Interim Decisions. While the option of an internal review of decisions does not appear strongly supported by the TGA at this point in time, it is our view that this is an essential part of improving transparency and accountability of the scheduling system. Currently, there is no mechanism to challenge a decision even if there appears to be a fairly obvious error e.g. in wording of the Poisons Standard to reflect the decision. Where such decisions are allowed to remain unchallenged, there can be no accountability in the decision making process (e.g. potential error in wording of the isoeugenol decision). There are instances where the logic behind the decisions are difficult to understand e.g. the geraniol decision and continuing inclusion of geranium oil and citronella in Appendix B. While we realise that improving the transparency by publishing the logic of the decisions will most likely address this issue, a review process would ensure that there is a formal process in place if and when the need arises. We note that other improvements to transparency would significantly reduce the need for a review mechanism, which would also mean that it should not be a significant burden. It would simply be a formal process in place to address the few occasions where other transparency and accountability measures fail.

2. Application to amend the Poisons Standard Accord supports the concept of the “self-identified” review process where the advisory committees, or the Delegate can initiate an amendment of the Poisons Standard. We recommend that this process include:

a mechanism to prioritise reviews, and a mechanism to allow external stakeholder input i.e. where issues identified by any external

stakeholders can be put forward to the advisory committee members, the Delegate or the Secretariat

3. Use of GHS in the risk management of chemicals

Accord has always been a strong advocate for providing information to the end user in a form that is easily understood by that end user. For the general public i.e. consumers in general, we believe this is best achieved when:

there is an expert risk assessment of products/groups of products, risk management measures including decision to ban/restrict ingredients, specific labelling

elements, child resistant packaging, etc. are applied based on the risk of the products and its use (not simply on hazard), and

simple everyday language is used to communicate with consumers (not technical jargon or coded information e.g. pictorial representations).

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We do not support the application of GHS labelling on consumer products because GHS is a hazard based information system relying on risk management decisions to be made by the end user. Despite the name (Globally Harmonised System…), GHS has not been globally adopted, especially not in the cosmetics and agricultural chemical sectors, or in transport2. In transport, it is widely recognised that a different UN document, the United Nations Recommendations on the Transport of Dangerous Goods (UNRTDG) is the basis of international and local transport regulations. Where GHS has been adopted for consumer products for labelling i.e. the EU, there appears to be a continuing challenge of appropriate risk communication to consumers due to some high levels warnings appearing on low risk consumer products e.g. corrosion pictogram on stainless steel cleaners that are not corrosive to skin and eyes, corrosive pictogram on laundry, dishwashing and other products containing surfactants etc. Further, GHS was never intended to be adopted for human and animal medicines or cosmetics post manufacturing and packaging process3. The Asia Pacific Economic Cooperation (APEC) Chemical Dialogue (CD) has discussed at length pragmatic solutions for GHS implementation for the consumer products sector for many years. Noting that the primary intent of GHS is to facilitate trade (where potential risks of consumer products are already well managed through existing legislation as it is in Australia and a number of other APEC economies such as Japan, USA, etc.), the main stumbling block was identifying a method of implementing GHS without reducing the effectiveness of existing regulatory controls for consumer products in each of the APEC economies and in a way that facilitates trade across the APEC region. In 2010, the APEC CD agreed to a document outlining the approaches that the APEC CD economies could take in implementing GHS for consumer products (if the economy was planning to adopt GHS). This document is provided as Attachment 2.1 The 2010 APEC CD document then led to a compilation of case studies to aid APEC economies considering GHS implementation, highlighting different ways GHS can impact on the consumer products sector, and learning outcomes that may help reduce the impact4. Further, while SafeWork Australia presentation at the Chemical Stakeholder forum on 22 November 2016 referenced the 2009 Regulation Impact Statement by the then Office of Chemical Safety and Environmental Health (OCSEH)5, it did not identify that the preferred option identified was option 2. Option 2 is “Adoption of GHS classification criteria, adoption of the GHS hazard and precautionary statements, rejection of the GHS signal words and pictograms, preserving existing SUSDP Schedules 5, 6 and 7 with GHS classification criteria being appropriately aligned with these existing schedules.” (Page 5 of the RIS). Under this option, GHS labels would not be applied to consumer products – labelling underpinned by risk assessment decisions compiled in the Poisons Standard would remain. For completeness, we are providing our submission to the 2009 OCSEH consultation as attachment 2.2.

2 A regular survey of GHS implementation in APEC economies have identified that GHS is generally implemented for workplace chemicals, but the uptake for other sectors continue to pose a challenge. A report on transport sector was removed in 2015 after the 2014 report identification that the GHS implementation does not affect the transport sector as the harmonisation work between GHS and UNRTDG occurs at the UN level (http://great.osha.gov.tw/content/image/fck/2016%20CD%20Virtual%20Working%20Group%20Report 20160509(1).pdf) 3 Quote contained in s 1.1.2.4: “Pharmaceuticals, food additives, cosmetics and pesticide residues in food will not be covered by the GHS in terms of labelling at the point of intentional intake” (http://www.unece.org/fileadmin/DAM/trans/danger/publi/ghs/ghs rev06/English/01e part1.pdf) 4 http://great.osha.gov.tw/content/image/fck/Consumer%20products%20case%20studies%20on%20GHS%20implementation.pdf 5 https://www.health.gov.au/internet/main/publishing.nsf/Content/4D646BAF62F0A1E8CA257BF0001F40B3/$File/GHS%20Discussion%20Paper Final%20Draft%20for%20Approval 16%20March%202009.pdf.

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We acknowledge that for some products that are traditionally viewed as “chemicals” e.g. paints, sealants, pool chemicals, etc., we believe that there may be merit in GHS labels (workplace labelling requirements) but only as an alternative compliance to Poisons Standard label (please also see our comments in Attachment 3, point 4). This is different to cosmetics such as shampoos and household cleaning products such as dishwashing detergents (under GHS both would require signal heading “DANGER” and a pictogram representing corrosion). Accord is however open to the discussion of using some of the logic underpinning GHS classification on acceptability of data, weight of evidence approach etc. For example, we are strongly supportive of one of the principles underpinning GHS, reducing animal testing/removing unnecessary animal testing. In order to use some of the GHS principles, we believe that there is a significant re-write of SPF sections that deal with hazard criteria may be required. Accord is also supportive of this type of review. For example, one of the current SPF hazard criteria is for acute oral toxicity testing up to 5000mg/kg. These tests are no longer done to such high concentration as it is recognized that it is unnecessary for contemporary risk assessment.

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Attachment 3 Summary

Issues Potential solutions 1 Regulated substances

are difficult to identify For a new substance considered for scheduling, identify the

substance by its CAS number, common name and all known synonyms.

Where a group of substances are considered, all substances considered should be identified, including all salts and derivatives that are intended to be captured.

Only include in the Poisons Standard those substances that have been identified for scheduling i.e. remove the concept of salts and derivatives as we know it now and create a schedule entry with links to all of its known synonyms, CAS number, etc.

For substances currently listed in the Poisons Standard, review as the need arises (or as work load allows) working closely with stakeholders.

2 Regulatory decisions are not deliberate and controls are imposed without proper regulation impact assessment

Schedule entries should be more specific, identifying the use, misuse and/or abuse as appropriate, reflecting the risk management considerations of the Advisory Committees and the Delegate.

3 No exemption for low concentration of scheduled Poisons

Include a statement allowing low concentrations of Scheduled Poisons to be exempted from the requirements of the Poisons Standard if they are impurities that cannot be removed, and the concentration is as low as technically possible.

4 Unclear regulatory boundaries

Appendix A entry for “ALGICIDES, BACTERIOCIDES OR SLIMICIDES for industrial use that do not fit the definition of an agvet chemical product.” should be amended to apply to all biocides for industrial use not fitting the APVMA definition of an agvet chemical product.

Exempt industrial products meeting GHS labelling requirements as set out in the Work Health and Safety Regulations from Poisons Standard labelling requirements. Other controls such as child resistant closure set out in the Poisons Standard can continue to apply.

5 Reliance on de facto regulation without overt acknowledgement

Recognise IFRA Standard in the Poisons Standard. Recognise the regulatory controls through ingredient

restrictions set out in the EU Cosmetics Regulations Annexes in the Poisons Standard.

Where a difference in regulatory controls arise between two or more trusted jurisdictions or new/different information emerges, these can be considered through the usual Poisons Standard amendment process.

6 Short transition time for products currently in supply

Where a scheduling decision affects products identified as currently in supply in Australia, and the regulatory change is not identified as urgent for public health protection, apply default transition time of 24 months.

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1. Regulated substances are difficult to identify Currently a chemical substance or a group of chemical substances is listed in the Poisons Standard by name in a schedule entry, sometimes with cross-referencing in the index to other names. Depending on why the substance was considered before it was included in the Poisons Standard, the name used for the Poisons Standard can be its Australian Approved Name (AAN), the International Cosmetic Ingredient (INCI) name, the International Union of Pure and Applied Chemistry (IUPAC) name, or a common name. Depending on the industry, the users of the Poisons Standard may not be aware of all the different naming conventions and may not be able to readily identify that a substance in their product is captured in a schedule in the Poisons Standard. Example 1: Deanol (AAN) Deanol is the AAN listed in Schedule 4 of the Poisons Standard. Deanol is also known as 2-dimethylaminoethanol (common name), N,N-Dimethyl-2-aminoethanol (IUPAC name) and dimethyl MEA (INCI name), with Chemical Abstract Services (CAS) number 108-01-1. Deanol has local and international uses in cosmetics, paints, laquers and varnishes, and is used as a starting material in the manufacture of other substances for different industrial uses.

Where a substance is listed as a group, it is even more difficult to identify all the substances that may be captured by the group entry. Example 2: C8-C18 alkyl dimethyl benzyl ammonium chloride C8-C18 alkyl dimethyl benzyl ammonium chloride is not listed in the Poisons Standard as a substance. The user of the Poisons Standard would have to first identify that the substance is a quaternary ammonium compound and a benzalkonium chloride to search for these terms in the Poisons Standard and find schedule entries “Quaternary ammonium compounds” (schedules 5 and 6) and “Benzalkonium chloride” (Schedule 5 and 6). The identification of a group that may capture a substance is not always as simple or straight forward as it is in this case. Even in this fairly straight-forward case, we believe there are people that may not be able to identify and find the relevant group entries. Once the relevant group entries have been identified, the user would then have to come to the conclusion that the benzalkonium chlorides are a subset of quaternary ammonium compounds, and therefore arguably a more specific description of C8-C18 alkyl dimethyl benzyl ammonium chloride. Benzalkonium chloride schedule entry would therefore be the more relevant schedule entry to use for C8-C18 alkyl dimethyl benzyl ammonium chloride. This conclusion would additionally be supported by the fact that the banzalkonium chloride is a more restrictive schedule entry than quaternary ammonium compounds schedule entry (the Poisons Standard states that where a substance is captured by more than one schedule entry, the more restrictive schedule entry should apply). However, if the user had only identified that the substance is a quaternary ammonium compound, then the more restrictive schedule entry would not have been used, potentially leading to technical non-compliance.

Example 3: Azo dyes entry The listing of azo dyes in Schedule 7 of the Poisons Standard arose as a part of the NICNAS IMAP process. The full entry reads as follows: AZO DYES that are derivatives by diazotisation of any of the following substances:

p-aminoazobenzene (CAS No. 60-09-3) o-aminoazotoluene (CAS No. 97-56-3) o-anisidine (CAS No. 90-04-0) p-chloroaniline (CAS No. 106-47-8) 4-chloro-o-toluidine (CAS No. 95-69-2) 6-methoxy-m-toluidine (p-cresidine) (CAS No. 120-71-8) 2-naphthylamine (CAS No. 91-59-8)

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5-nitro-o-toluidine (CAS No. 99-55-8) 2,4-toluenediamine (CAS No. 95-80-7) o-toluidine (CAS No. 95-53-4) 2,4,5-trimethylaniline (CAS No. 137-17-7)

This schedule entry relies on the user of the Poisons Standard being an organic chemist that is familiar with the process of diazotization and therefore can name the reaction products of listed reactants. When making the decision, the Delegate made the following statement: “The delegate notes the concerns that substances described in the generic entry may be difficult for industry to identify, but points to the NICNAS IMAP report that lists all 72 dyes on the Australian Inventory of Chemical Substances (AICS) that would be included in the generic entry.” That is, if the user is not an organic chemist that can derive the reaction products of the diazotization of listed reactants, the user can refer to the NICNAS IMAP report. This is already an impossible task for any user that is new to using the Poisons Standard. Even if the user had the historical understanding and knows to search for the NICNAS IMAP report, the right report must be located to know which substances are captured. On 2 December 2016, the NICNAS website provided close to 3000 hits for AICS entries, 316 assessments and 240 site content for the search term “azo dyes”. Due to my historical knowledge of the azo dyes scheduling decision, I know that the assessment that links with the decision is the “Dyes that could release selected carcinogenic amines (listed on AICS)” report. Not everyone would be familiar with the decision to this level. This convoluted method penalises industry in two key aspects:

1. It requires increased time to identify the affected substances. 2. It facilitates accidental/inadvertent non-compliance by those organisations who don’t maintain sufficient

regulatory awareness. These organisations may innocently search their ingredients on the Poisons Standard and if they cannot be found easily they may assume their formula is compliant.

For example, Basic Red 76 (a common name used for a pigment captured under the azo dyes entry), its colour index number CI 12245, and its IUPAC name 7-Hydroxy-8-[(2-methoxyphenyl)azo]-2-naphthyl]trimethylammonium chloride are not listed in the Poisons Standard. A company searching through the Poisons Standard for the substance without the historical knowledge cannot be expected to simply know that the azo dyes entry captures Basic Red 76.

In the above example, despite industry’s identification that one of the 72 substances (Basic Red 76) is currently used in Australia in hair dyes, the substance was included in the schedule entry. Industry requested additional time for companies to review all their product but this was not granted. We are now in a situation where companies that are aware of the decision are pulling together additional information to support re-introducing their products back in Australia. However, there may be other companies that are not be aware of the decision (and the Schedule entry is almost impossible to decipher without historical knowledge). We must note that it is not only industry that can stumble due to unclear regulatory requirements. Decision makers and regulators with good technical knowledge also face a difficult task when clarification on requirements are sought. The compliance difficulty for both industry and regulators is escalated to an almost impossible level where salts and derivatives of a substance must also be considered. Example 4: Bearberry extract Bearberry extract (INCI name arctostaphylos uva ursi leaf extract) is used as a skin conditioning agent in cosmetic products. One of the components of bearberry extract is arbutin. Arbutin is a glycosylated hydroquinone and can be used as a skin lightening agent, like hydroquinone, and the Chemical Scheduling deliberations concluded that it is indeed a derivative of hydroquinone and should be included in the same schedule entry.

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It is difficult for the company importing a product with the ingredient disclosed as “bearberry extract”, arctostaphylos uva ursi leaf extract or arbutin to know that their product is potentially scheduled due to the hydroquinone schedule entry. While the Chemical Scheduling deliberations on arbutin made the decision to create a cross-reference to hydroquinone, we discovered recently that there is no index entry for arbutin. Rather, the index entry for hydroquinone states “cross reference ARBUTIN”. A Poisons Standard user searching the index alphabetically for arbutin would not find it, which may lead to non-compliance. We have recently informed the Scheduling Secretariat of this error. More to the point however, the regulators would also not have known that arbutin or bearberry extract should be caught by the same schedule entry for hydroquinone. It is interesting to note that the scheduling consideration of arbutin was put forward for Chemical Scheduling by someone in industry frustrated that they were the only ones applying the hydroquinone restriction on products containing bearberry extract.

Further, unlike medicines, it can be easier to find a wide range of chemical substances that will be suitable for a given function and have similar risk/safety profile. Are these all derivatives? Example 5: Ammonium cocoyl isethionate Currently a surfactant ammonium cocoyl isethionate is included in Schedule 6, (except when excluded as per the Schedule entry). We note that salts and derivatives are not excluded from the schedule entry. While the substance is already a salt, the question raised is, if a counter ion was not ammonium but something else e.g. potassium, is the substance still captured by the Schedule 6 entry? Is it considered a derivative in the broad sense as used in the Poisons Standard? What if the fatty acid used was not derived from coconut (which gives rise to the “cocoyl” part of the surfactant) but palm oil or tallow? The fatty acid mixture of all three are very similar and very much interchangeable. What if a narrower fatty acid chain was used e.g. lauryl (mainly C12)? If the answer is yes, these are derivatives in the broad sense, how is anyone supposed to know that sodium lauryl isethionate is captured by the ammonium cocoyl isethionate schedule entry? If the answer is no, then how can this be clearly communicated to the regulated industry?

Retrospective interpretations such as identified in examples 4 and 5 above are necessitated by the fact that the scheduling consideration of a “substance” is incredibly broad. Industry is currently in an unhappy situation of not only responding to the consultation on the substance itself, but to research a potentially infinite array of salts and derivatives of the substance and their potential uses in a fairly short consultation period. Example 6: gamma-butyrolactone/GHB In November 2014, gamma-butyrolactone was considered for Chemical/Medicine Scheduling due to concerns over gamma hydroxybutyrate (GHB), its metabolic product. The scheduling consultation was for the substance (salts and derivatives not specifically excluded) in cosmetics to be included in Appendix C/Schedule 10 or Schedule 9. In researching the substance we stumbled on the fact that a significant number of fragrances and flavours have gamma-butyrolactone as its basic structure with varying length of alkyl chain. These include peach (gamma-undecalactone) and coconut (gamma-nonalactone). These fragrances are often used in cosmetic products, and if derivatives were not excluded, these products would have been banned in Australia (Schedule 10) We were pleased to note that our submission appeared to have had an impact, and derivatives were excluded in the gamma-butyrolactone schedule entry. However this raises significant concerns that had we not raised these derivatives in our submission, these fragrances and flavours could have been included in Schedule 10.

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If industry is unable to identify all salts and derivatives that have legitimate uses, then there is a very high probability that those salts and derivatives will be captured in the schedule entry without due consideration of their risk. Inevitably, some salts and derivatives are not thought of until after the scheduling decisions are made (leading to situations a described in Examples 4 and 5 as well as Example 7 below).

Example 7: 2-ethylhexanoic acid and triethylhexanoin Currently 2-ethylhexanoic acid and its alkyl esters are included in Schedule 6 (with exclusions based on % in product). The entry does not exclude salts and derivatives, however the entry specifically mentions the acid and its alkyl esters which begs the question whether other derivatives are captured in the schedule entry. Triethylhexanoin is a glyceryl triester used in cosmetics as conditioning agents. There have been some questions raised as to whether it is reasonable to group triethylhexanoin as an alkyl ester of 2-ethylhexanoc acid. However, there is no doubt that if it hydrolyses, it will give rise to 2-ethylhexanoic acid. Also, the schedule entry does not exclude derivatives and triethylhexanoin is a derivative of 2-ethylhexanoic acid. It is our understanding that the regulatory cut-off of % alkyl esters of 2-ethylhexanoic acid in a product is based on worst-case assumption that all of the ester will hydrolyse to give rise to the acid. As far as we are aware, triethylhexanoin and its wide-spread use in cosmetics internationally was not considered when the decision was made to include 2-ethylhexanoic acid in Schedule 6. Industry did not make the connection between the triethylhexanoin and 2-ethylhexanoic acid until after the final decision. This also means that the industry had not had a chance to defend the ingredient and the concentration of the ingredient in the final use product. Worst case assumption of risk does not always deliver the best regulatory outcome. We again stress that it is those compliant companies and individuals that are constantly checking and monitoring the schedule entries and their potential derivatives and salts that understand that triethylhexanoin may be captured by the 2-ethylhexanoic acid schedule entry. There are many more companies that are unaware and may be supplying imported cosmetic products that may be a S6 scheduled poison. This is not to suggest that there is a public safety issue – triethylhexanoin is widely used in cosmetics without restrictions in other jurisdictions such as the EU and the USA.

We believe that it is essential that those that are required to comply with regulatory controls are clear on their compliance obligations. The more difficult it is to find information on compliance requirements, the less likely it is that companies will be compliant. Setting a scope for regulatory controls is essential to identify expectations on regulatory compliance and it is an essential part of good regulatory practice. One of the ten principles for Australian Government Policy Makers6 is that regulation should be imposed only when it can be shown to offer an overall net benefit. If the regulators and decision makers are unsure to which substances their decisions apply, it is not possible to consider whether the decision offers an overall net benefit. We will discuss this point in more detail under the second issue, “Regulatory decisions are not deliberate and controls are imposed without proper regulation impact assessment”. Further inadvertently including a substance in a schedule without proper consideration of the risk, then asking applicants to provide information to support removing the imposed regulatory burden reverses the onus of proof and is contrary to the principles of best practice regulation. Potential solution

For a new substance considered for scheduling, identify the substance by its CAS number, common name and all known synonyms.

Where a group of substances are considered, all substances considered should be identified, including all salts and derivatives that are intended to be captured.

6 The Australian Government Guide to Regulation (https://www.dpmc.gov.au/resource-centre/regulation/australian-government-guide-regulation).

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Only include in the Poisons Standard those substances that have been identified for scheduling i.e. remove the concept of salts and derivatives as we know it now and create a schedule entry with links to all of its known synonyms, CAS number, etc.

For substances currently listed in the Poisons Standard, review as the need arises (or as work load allows) working closely with stakeholders.

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2. Regulatory decisions are not deliberate and controls are imposed without proper regulation impact assessment

Currently, the Poisons Standard captures a wide range of products including therapeutic goods (ranging from prescription only medicines through to OTC medicines), agricultural chemicals, veterinary medicines, consumer/household products, cosmetics and industrial products (that have not been specifically exempted). As previously stated, we believe that setting a scope for regulatory controls is an essential part of good regulatory practice – without the scope it is not possible to properly consider the regulation impact of the decision. Identifying the specific use, the potential misuse and abuse of the substance and providing regulatory controls for identified circumstances would lead to better regulatory outcomes reducing unintended outcomes e.g. scheduling consideration of S4 medicines should be limited to therapeutic uses of the substance. In short, we will call this deliberate regulatory decision making. Currently, a scheduling consideration may be limited e.g. to the therapeutic use of a medicine to be included in Schedule 4. However, once the substance is included in Schedule 4, all uses of the substance and its salts and derivatives are captured by the schedule entry unless it is specifically excluded. The regulatory impact on non-therapeutic uses of the substance are not necessarily considered i.e. there is no deliberate regulatory decision to manage non-therapeutic uses of the Schedule 4. Example 8: Deanol (for therapeutic use) Deanol is the AAN listed in Schedule 4 of the Poisons Standard. In 2014, NICNAS IMAP process identified that deanol is the same substance as 2-dimethylaminoethanol (common name), N,N-Dimethyl-2-aminoethanol (IUPAC name) and dimethyl MEA (INCI name), with CAS number 108-01-1. Deanol used to be listed in Schedule 4 with no exclusions or caveats (i.e. the entry simply read “DEANOL”). Deanol has local and international uses in cosmetics, paints, laquers and varnishes, and is used as a starting material in the manufacture of other substances for different industrial uses. When this issue was identified in 2014, the Poisons Standard was amended (following the usual consultation process). The Schedule 4 entry now reads “Deanol for therapeutic use”. Until this point in time, technically speaking, non-therapeutic products containing deanol e.g. skin care, house paint, etc. were prescription only medicines. Interestingly, the only reason that the deanol schedule entry had not cause any significant issues for industries using the substance for non-therapeutic purposes was that it was not readily identifiable, leading to wide spread technical non-compliance. This examples highlights a number of issues. These are:

When deanol was first included in Schedule 4, the use of deanol other than as a prescription medicine was not considered, but the schedule entry was applied to all uses of deanol,

Industry using deanol could not readily identify the substance and therefore there was widespread technical non-compliance to the requirement,

Technical compliance to the requirements would have led to restrictions on a substance that has a legitimate use locally and internationally,

Had this issue been identified by a company (rather than NICNAS in this case) using the substance in e.g. a cosmetic products, then the onus would have been on the company to provide an application including data to amend the schedule entry. This creates an unfair regulatory burden for a company that may be checking the requirements more diligently than others. In addition, the company would have had to stop supply of their products until the issue was resolved (creating more unfair commercial disadvantage).

Limiting the scheduling decision to therapeutic uses only from the beginning, to reflect the fact that only therapeutic uses were considered for risk management would have avoided this confusion.

It is very concerning that due to the decision making process at times (starting very broad and eliminating substances/use situations from risk management decisions), a legitimate use of a substance may be inadvertently scheduled because it was not specifically excluded.

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It is not sufficient to simply state that stakeholders have an opportunity to provide comments. Firstly, for Schedule 4 medicines, the decision generally does not go out for public consultation prior to being included in the Poisons Standard. Even when there is a consultation, it is put to the Advisory Committee on Medicine Scheduling and not the Advisory Committee on Chemical Scheduling as it is assumed that it is for medicinal use only. Even if the consultation was broader, the chemical industry still faces the difficult task of identifying the chemical by the name that it would be known in our industry, then to consider all of its salts and derivatives that may have a legitimate use. Further this type of consultation puts the onus on industry to identify then prove that the current legitimate uses of chemicals should remain unregulated. This type of consultation does not meet the principles of best practice regulation, and best practice consultation as set out in the Best Practice Consultation Guidance Note7. The Australian Government Guide to Regulation8 sets out seven Regulation Impact Statement questions, the first of which is “What is the problem you are trying to solve?” If the answer to this question does not involve salts and derivatives, or industrial uses of the substance at the time of consultation, then these substances/situations should not be included in the decision to regulate the substance through the Poisons Standard schedule entry. The problem here is two-fold. Firstly, compliant companies are unable to make use of ingredients in products posing low public health risk. Secondly, because the public health risk is low, regulators are reluctant to seek compliance from non-compliant companies. Example 9: Hydroquinone in skin whitening and MEHQ in nail polish Hydroquinone is currently included in a number of different schedules depending on its use. One of the major concerns with the use of hydroquinone is its ability to suppress melanine production (it is our understanding that in the past, it has been used in cosmetic “skin whitening” products). Until fairly recently no cosmetic uses of hydroquinone were allowed. p-Hydroxyanisole (also known as 4-methoxyphenol or mequinol) is a methyl ester of hydroquinone and is therefore captured by the hydroquinone schedule entry (because it does not exclude derivatives). p-Hydroxyanisole is used in nail polish (gel nails) as a polymerization inhibitor in a very low concentration (200ppm). Its function and therefore the risk of the product containing the ingredient is significantly different to that of skin whitening preparation containing hydroquinone. A company that identified the issue made an application to amend the Poisons Standard. Their application was initially deemed not acceptable by the Secretariat as it only dealt with the difference in the risk of hydroquinone in skin whitening preparations and p-hydroxyanisole in nail preparations, however the Delegate at the time accepted the application for consideration through the normal Chemical Scheduling process. The company did not introduce any products until the issue was resolved. Its competitors however, were introducing products containing p-hydroxyanisole. Intially, these companies did not know that p-hydroxyanisole was a hydroquinone derivative so did not know that it was scheduled. Some companies did not even know that the ingredient was in their product – due to its low concentration, some exporters were not even disclosing the ingredient on their label. However, as regulators did not seek compliance (we understand that this was due to low public health risk), non-compliant companies continued to market their products despite knowing that they were non-compliant. The compliant company was therefore penalised twice. They dedicated resources to amend the Poisons Standard, knowing that their competitors would also benefit from the final decision. They also lost market share because unlike some of their competitors, they waited until the Poisons Standard was amended.

7 https://www.dpmc.gov.au/resource-centre/regulation/best-practice-consultation-guidance-note 8 https://www.dpmc.gov.au/resource-centre/regulation/australian-government-guide-regulation

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A substance can also be considered for a specific new use, but the scheduling controls have the potential to capture existing uses of the same substance that has not presented a regulatory concern or a demonstrated need for additional risk management. Example 10: Sodium lauryl sulfate in injectable veterinary medicine Sodium lauryl sulfate (SLS) is a widely used surfactant used in cosmetics, personal care, household cleaning, industrial cleaning, oral care products, therapeutic goods, food preparations, etc. As far as we are aware, internationally, no regulator had found the need to restrict the use of SLS in general cleaning products or cosmetics and personal care products. SLS is currently a Schedule 6 poison (under lauryl sulfate salts entry) in Australia (with exclusions). SLS was put forward for scheduling when it was considered by the APVMA as an injectable veterinary medicines. There were no concerns raised with other uses of SLS when it was put forward for scheduling. Accord supported limiting SLS scheduling to injectable veterinary medicines noting that there have been no public safety concerns raised with other uses of SLS. While there appeared to have been general agreement that there are no concerns with the use of SLS, the decision was to schedule SLS anyway for all uses and exempt out certain uses and concentrations. It was also decided that warning and safety statement should also be mandated (through reverse scheduling) noting that most companies do this anyway. Since the decision, we have had companies facing either relabeling of fully imported cosmetic products to add warning and safety statements, or stop supplying those products. In most cases, companies stop supply as they can no longer justify the business case for a unique Australian label. The SLS decision has also since changed to capture all salts of lauryl sulfates. This has meant that products that were available in Australia and were not scheduled poisons, were suddenly scheduled poisons due to slightly higher concentrations of lauryl sulfates (salts other than sodium e.g. ammonium).

In the above example, while the initial decision to schedule SLS was deliberate decision making (which we believe was unnecessary and contrary to the principles of best practice regulation), the decision to broaden the schedule entry to include other salts is counter to the initial intent of the SLS schedule entry decision, which was to exclude products that were available in Australia. We do not believe that this is deliberate regulatory decision making. In the initial SLS decision, the regulation impact was properly considered and an effort was made to remove any impact on existing product (although not entirely successful). In the second decision, as the focus was reflecting the initial decision in terms of concentration limitation in products rather than the intent of the initial decision, the regulation impact was not properly considered. These issues could have been avoided if SLS was considered specifically for injectable veterinary medicine use as it was initially put forward. We note that currently, Australia appears to be the only country that imposes specific product concentration based risk management controls for SLS in cosmetics and consumer products. Potential solution

Schedule entries should be more specific, identifying the use, misuse and/or abuse as appropriate, reflecting the risk management considerations of the Advisory Committees and the Delegate.

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3. No exemption for low concentration of scheduled Poisons Currently there are no low concentration exemptions for substances that are included in Schedule 7, unless the schedule entry provides a specific exemption. When the Poisons Standard was first introduced, the detection methods used would not have picked up trace levels of ingredients. In most cases, a statement that there is no ingredient X is a product would have simply meant that ingredient X was not added to the product, and that it is not an expected by-product, impurity etc. The detection methods utilized now are more sophisticated. In most cases, detection to parts per billion (ppb) level is possible. This can cause problems for products that contain a Schedule 7 ingredient as an impurity.

Example 11: Ethylene oxide Ethylene oxide is listed in Schedule 7 with no exemptions. Ethylene oxide is an ingredient widely used in manufacture of surfactants. These surfactants contain trace amounts (generally below 10 ppm) of ethylene oxide and technically speaking all products containing these surfactants should be Schedule 7 Dangerous Poison requiring labelling and other controls such as licensing and restrictions on supply. In reality no-one can comply with this requirement and no regulator enforces the requirement as it does not make sense. However, the regulatory requirement remains.

Where compliance to a regulatory requirement is not expected, that requirement should be removed. Otherwise, it can create confusion for both regulators and those that are expected to comply with regulations – if non-compliance to one requirement is acceptable, why not to others? Who decides which regulations must be complied with and which ones can be ignored? Potential solution:

Include a statement allowing low concentrations of Scheduled Poisons to be exempted from the requirements of the Poisons Standard if they are impurities that cannot be removed, and the concentration is as low as technically possible.

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4. Unclear regulatory boundaries For “industrial” chemicals, it is not always clear whether certain chemicals in the Poisons Standard are exempt through industrial use exemption. Example 12: Industrial use biocide DCOIT and Appendix A For the March 2015 ACCS meeting, a company provided an application to amend the schedule entry for 4,5-dichloro-2-N-octyl-3(2H)-isothiazolone (DCOIT) to allow the use of the preservative in their industrial use products. One of the questions asked by the company was whether the exemption in Appendix A for “ALGICIDES, BACTERIOCIDES OR SLIMICIDES for industrial use that do not fit the definition of an agvet chemical product.” and whether the application was necessary in the first place. Depending on the concentration used, DCOIT is effective against bacteria, algae and fungi. This is true of many biocides where they are effective against a range of microbes, sometimes depending on concentration. We understand that this question is still unresolved i.e. two years on, the company still does not know whether their ingredient/product is exempt from the Poisons Standard requirements. In 2015, the Delegate noted that this is a decision for States and territories. We understand that at least one State has referred the company back to the Chemical Scheduling process despite the statement by the Delegate.

Even when it is clear that a product is within the Poisons Standard regulatory scope, the requirements can be confused due to unclear regulatory boundaries. While the Poisons Standard exempts certain products from the Poisons Standard labelling requirements (“Poisons which are packed and sold solely for industrial, manufacturing, laboratory or dispensary use”), there does not appear to be a cohesive recognition of the risk management system in place for industrial use products. In communicating risk, we believe that it is important to focus on the end user and their understanding of hazard and risk. While we are strongly supportive of consumer labels that are specifically targeted to consumer understanding, there are some grey areas where products can come in contact with general public but are generally identified of as workplace use products. These include DIY products such as paints, solvents and adhesives and cleaning products that are supplied to cleaning companies (for professional cleaning of hospitals, schools, nursing homes, etc). Noting that, through workplace health and safety regulations, there is a robust system of risk assessment and communication of hazards and risks through provision of SDS and labels for workplace chemicals, we believe that it is appropriate to exclude these products from the scope of Poisons Standard labelling requirements, provided that they meet the workplace labelling requirements. This would ensure that companies can choose the most appropriate labelling system with the understanding of the end user in mind. Example 13: Hard surface cleaners used in nursing homes, childcare, etc. A company producing hard surface cleaners that are Scheduled Poisons (but not regulated by the TGA) and a Hazardous Chemicals (according to workplace classification requirements (GHS)) for use in a school is required to label his products to both requirements. This in itself is a duplication of regulatory effort. While in most cases the labelling requirements are similar, the signal heading required by the Poisons Standard (DANGEROUS POISON, POISON or CAUTION) and GHS under workplace regime (DANGER or WARNING) occupy the same space on the label. They must be either presented side by side on the label (potential confusion with “DANGEROUS POISON”) or the company must choose one above the other. Neither solution provides better clarity to the end user.

Potential solution

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Appendix A entry for “ALGICIDES, BACTERIOCIDES OR SLIMICIDES for industrial use that do not fit the definition of an agvet chemical product.” should be amended to apply to all biocides for industrial use not fitting the APVMA definition of an agvet chemical product.

Exempt industrial products meeting GHS labelling requirements as set out in the Work Health and Safety Regulations from Poisons Standard labelling requirements. Other controls such as child resistant closure set out in the Poisons Standard can continue to apply.

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5. Reliance on de facto regulation without overt acknowledgement of international regulatory controls

There are a number of global regulatory and quasi-regulatory controls that appear to be followed by the majority of industry regardless of whether they are mandated by local regulations. The two most obvious examples are:

The International Fragrance Association (IFRA) Standards, and The EU Cosmetics Regulations.

Overt recognition of these controls has the potential to improve the efficiency of the current Chemical Scheduling process while improving the understanding of compliance requirements by industry and implementing the government’s “Accepting Internationally Trusted Standards” policy. IFRA Standard The IFRA Standard has solid scientific basis, and is a result of Quantitative Risk Assessment (QRA). While IFRA is not a regulatory body, its standards are adhered to by fast moving consumer goods (FMCG) companies. We understand that rather than disclosing all of their ingredients and proportions, the fragrance houses inform their customers of the concentration of their product that can be used in different types of formulations to meet regulatory requirements, and the IFRA Standard. Companies in turn comply with this direction, as it ensures their safety and also because fragrance compounds can impart different scents/odours depending on the concentration used. While many of the fragrance ingredients are skin irritants or sensitisers when used in high concentrations, we note that not many are included in the Poisons Standard. Generally speaking, in the past few years when fragrance ingredients were put forward for scheduling, the Delegate has chosen not to schedule the ingredient, in many cases citing no evidence of concern to justify scheduling. We believe that one of the reasons for the lack of public health issues is because there is a general adherence to IFRA Standard by industry.

Example 14: Decision not to schedule 3 fragrance ingredients In December 2014, the Delegate made a decision not to schedule three fragrance ingredients. While there was evidence of some skin irritation and sensitization potential (for one ingredient), it was noted that there was no evidence of concern in Australia, and inclusion in the Poisons Standard was not warranted.

Where a need for scheduling is identified in the Australia context, generally speaking, the Delegate has made scheduling decisions to reflect the IFRA Standard.

Example 15: Citral (and its isomers) Citral was identified as a potential concern that requires risk management controls. As citral is a naturally occurring fragrance found in a large range of plant extracts (and therefore widely used), it was important to consider all of the plant extracts to ensure that the scheduling decision was consistent. We note that part of the Delegate’s decision was to amend the lemongrass oil (which contains citral) entry. The lemongrass oil entry in Appendix B was deleted and a new Schedule 5 entry created to align with the schedule entry for citral. The Delegate appears to have been mindful of the IFRA Standard as the Poisons Standard entry is reflective of the IFRA Standard requirements e.g. not scheduling non-skin contact products noting that the concern is related skin contact, scheduling products containing more than 5% citral noting that the highest concentration allowed by IFRA Standard in any product is below 5%.

However, we acknowledge that the decisions of the Delegate can deviate quite significantly from the IFRA Standard. For example, the recent decision on geraniol is quite different to citral decision, as the

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concentration cut-off is lower than allowed by IFRA Standard for geraniol and the schedule entry applies to all products, even non-skin contact even though the concern is over sensitization. Further, natural oils containing geraniol are still included in Appendix B e.g. citronella and geranium oil which creates uncertainty as to the requirements applying to those plant extracts. Unlike the citral decision, we are yet to fully understand the logic behind this decision. If IFRA Standard was adopted into the Poisons Standard (and therefore had regulatory underpinning), it would be an overt acknowledgement of risk management controls that are applied internationally and generally adhered to locally. Using the IFRA Standard as the starting point for risk management decision making also has the potential to significantly improve the efficiency of the scheduling process for fragrances. EU Cosmetics Regulations Australia is a net importer of cosmetic products. If the product is imported from the EU, those products would comply with the EU Cosmetics Regulations, including banned/restricted substances requirements, etc., regardless of whether they are banned/restricted in Australia. The EU Cosmetics Regulations is also the basis of cosmetics regulations in ASEAN countries and our close trading partner and closest neighbour New Zealand. Australian companies that are importing/exporting or sharing stock with these regions i.e. New Zealand, ASEAN and the EU therefore also comply with the EU Cosmetics Regulations. An overt recognition that the EU Cosmetics Regulations is generally complied with has the potential to improve the efficiency of the Chemical Scheduling process.

Example 16: Industry agreement to schedule ingredients based on EU regulations Through the IMAP process, NICNAS has considered many of the substances in the Annex II (banned substances) and Annex III (restricted substances) in the EU Cosmetics Regulations. These substances were then put forward for consideration for Chemical Scheduling. In almost all cases, Accord had no objections to bans and restrictions proposed based on alignment with the EU. Sometimes, we provided comments to clarify the requirements e.g. a substance can be banned in one specific use but allowed in other cosmetic products. As the ingredients were already banned/restricted in the EU, Australian industry in general were already adhering to these requirements.

Potential solution:

Recognise IFRA Standard in the Poisons Standard. Recognise the regulatory controls through ingredient restrictions set out in the EU Cosmetics

Regulations Annexes in the Poisons Standard. Where a difference in regulatory controls arise between two or more trusted jurisdictions or

new/different information emerges, these can be considered through the usual Poisons Standard amendment process.

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6. Short transition time for products currently in supply The reason for Poisons Standard amendment can be categorized into four major categories. These are:

1. Introduction of new chemicals to Australia through the TGA, APVMA or NICNAS assessment process,

2. Down-scheduling of substances currently listed in the Poisons Standard, 3. Up-scheduling of chemicals in the Poisons Standard and 4. Inclusion of un-scheduled chemicals currently in use in Australia into the Poisons

Standard/up-scheduling. While we recognise the need for a short transition timeframe for situations described in points 1 and 2 above, for points 3 and 4, short transition time can pose a significant problem for industry. Accord has been informed by Members that the time required to properly manage any increased requirements is on average approximately 24 months. This is significantly different to the standard 3 month transition currently in place. We believe that the standard transition time should be amended to 24 months for up-scheduling, and inclusion of currently used substances in the Poisons Standard for the first time. In general, we note that the Poisons Standard amendment can be implemented over 24 months without posing any significant public health risks e.g. decisions on lauryl sulfates, isoeugenol, geraniol, etc. Where the amendment is required more urgently, the Delegate (with advice from States and Territories) can amend the implementation timeframe. Below is an example provided by one of our Members on the process that they must go through to implement a Poisons Standard amendment.

Example 17: Issues with short transition timeframe. There is an issue with the short implementation timings for changes to chemicals schedules, e.g. the isoeugenol change (up-scheduling) is only 8 months implementation time, even after the Delegate has extended the implementation timeframe. The standard timeframe for changes to scheduling of chemicals is very short (3 months). Our issues with the short implementation timings are as follows: Time required to amend an artwork: If no reformulation and no registration required, and if a simple label

change (e.g. not a ‘cluster’ label - see below for what this means - for which we then decluster and must consider minimum order quantities and other Supply considerations), then typically around 5 months from initiation of label artwork change to arrival of stock into our Australian distribution centre.

Resource required to amend artworks – and if a number of products involved then may not have adequate resource in-house or at the art house which processes all of the label artwork changes

Cost for label change per consumer unit– not including in-house staff cost, approx. $13000 per consumer unit (each individual product sold). If any packaging changes required (e.g. embossing, tactile ID, permanent printing on packaging) this is additional cost.

For some of our products we have a label which is common for a group of countries (we call it a ‘cluster’ label). For cluster/shared labels (except with NZ), we would have to decluster (other countries except NZ will not accept AU poisons schedule labelling), then may not meet the minimum order quantity required by the manufacturing site so we would be forced to delete the product. Even if we met the minimum order quantity, the cost of goods would increase (due to lower number of products per manufacturing run), or manufacturing runs would occur less frequently which increases cost due to holding manufacturing inputs for longer periods, and holding larger quantities of finished products for longer. Also higher risk of products in warehouse or supply chain reaching shelf life and having to be destroyed.

If reformulation required, depending on the change, need 6 - 12 months (sometimes longer) to reformulate, including shelf testing and other laboratory tests needed. Then another 7 – 12 months (depending on the change) to implement the change in the production facility (to new formula, new artwork) and transport and receive new formula in Australia at our distribution centre. If progressed according to the minimum timeframe to implement the change, it would result in a large cost for write-off of packaging materials (usually labels) and also possibly some of the chemical ingredients of the ‘old’ formula. Hence require 2 years minimum implementation time frame for changes to scheduling of chemicals.

If clinical testing required on reformulated product, add 2 months minimum. If registration application required – TGA, APVMA – add extra time Depending on the extent of the product changes, may not be acceptable to the grocery trade to run in the

new as the old is run out. May have to renegotiate acceptance of the (new) product.

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Short implementation timeframes make it extremely hard to manage the transition without some sort of write-off cost – raw materials (chemicals) and packaging (labels) and /or finished products.

Potential solution:

Where a scheduling decision affects products identified as currently in supply in Australia, and the regulatory change is not identified as urgent for public health protection, apply default transition time of 24 months.

Consultation submission: The Scheduling Policy …...Fusion C4.02, 22 - 36 Mountain Street, Ultimo...

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