KEY POINTS:
The Government's support parties have ditched their opposition to the establishment of a transtasman drug agency, despite their failed attempts to get dietary supplements and other complementary medicines excluded.
The Government signed a treaty in 2003 with the Australian Government agreeing to the agency, that would replace MedSafe and regulate medicines and medical devices, but has been unable to get the political support to pass enabling legislation.
If it was not tabled by the end of the year, it is likely the Australians would have abandoned the plan.
The Government yesterday tabled the Therapeutic Products and Medicines Bill, after gaining assurances the two parties would support it.
A key sticking point was the inclusion of complementary medicines - which would include a range of health products and low-risk dietary supplements.
New Zealand First leader Winston Peters and United Future leader Peter Dunne have publicly expressed their opposition to this aspect and had claimed to have convinced the Government to exclude those products from the new regime.
The Herald understands Minister of State Services Annette King had approached the Australian Government with the compromise option, but it would not agree to it.
Instead Mrs King has promised the Government will pay half the regulation costs incurred by the regime for the complementary medicines sector for the first five years.
Green MP Sue Kedgley said last month Mr Peters had promised his party had put an end to the complementary component and "his reputation would be in tatters" if he voted for the bill.
A spokesman for Mr Peters said yesterday the Government's decision to pay half the complementary costs - worth a total estimated at $9 million a year - "was a deal that we could not turn down".
The Government was determined to regulate the industry if it wasn't covered by the agency and NZ First was convinced that as a result "the cost to the industry will be no more than the cost of self-regulation".
As Foreign Affairs Minister, he had also been obliged to "consider the international treaty aspect" of the deal - considered a template for further joint ventures.
Mr Peters had also negotiated for the agency to have the potential to regulate medicines in the Pacific - an improvement on the legislation and one that would prevent the region becoming a dumping ground for bad products, his spokesman said.
