Guidelines

Detention of, dealing with, and disposal of, drugs like substances

I Dr Jeffrey Allan HARMER, Managing Director and Commissioner of the Health Insurance Commission, in pursuance of subsection 99ZS (2) of the National Health Act 1953 (the Act) HEREBY ISSUE the Guidelines concerning the Export of Pharmaceutical Benefits.

Dated this 12 day of February 2001

DR JEFFREY ALLAN HARMER

MANAGING DIRECTOR & COMMISSIONER

1\. Date of effect

Subject to section 99ZS(5), the guidelines take effect from the first day on which they are no longer liable to be disallowed.

2. Purpose
These Guidelines set out the performance of functions and duties of the Health Insurance Commission (the Commission) in monitoring the exportation of drug like substances that are subject to the pharmaceutical benefits scheme (PBS). These Guidelines address:
(a) detaining the drug like substances and any related documents;
(b) dealing with claims for the return of such drug like substances;
These guidelines shall be read in conjunction with the principles of the Commonwealth Fraud Control Policy.
3. Initial Action
3.1 Following notification by the ACS that drug like substances have been detained under sections 99ZJ or 99ZK of the National Health Act 1953 (the Act), an officer of the Commission shall make arrangements at the first practicable opportunity for the transfer of the substance to a Commission Exhibit Room pending their return, reconsignment or disposal.

The first practicable opportunity means a time that is operationally suitable to the Commission.

3.2 Under Section 99ZJ where drug like substances have been detained from a person attempting to leave Australia, the Commission officer shall ensure that a form “Notice Of Detention of PBS Drugs”[\[1\]](#_ftn1) has been issued by the ACS case officer detailing the amount and type of drug like substances detained. The ACS Case Officer will provide a copy of this form and any accompanying documentation to the Commission at the time of transfer of the drug like substances. Sub-sections 99ZN (2) (a) (b) (c) apply. During the hand over procedure, Commission officers will ensure the accuracy of the entry for the drug like substances recorded on the Notice of Detention of PBS Drugs prior to signing for their receipt.
In these instances the use of tamper proof evidence bags or seals are not required.
3.3 The Commission officer shall ensure the security of the drug like substance once in their possession for conveyance to the Commission office. The substance and related documentation shall at all times remain in the possession or effective control of the nominated Commission officer, until lodged at the nearest Commission, Professional Review Branch or Division, Exhibit Room.
The nominated Commission Officer will be an Investigation Officer whose name appears on the “Notice of Detention”. In remote areas, where possible, the Commission officer will be an officer from the local Health Insurance Commission branch office.
3.4 In remote areas where the Commission has been notified by ACS that suspected drug like substances have been detained, arrangements should be made by the Commission Officer to have the drug like substance conveyed from the ACS remote area to the respective state Professional Review office. In these circumstances, the Commission officer receiving the report from the ACS will make arrangements for a local Health Insurance Commission officer to

attend and take receipt of the drug like substances as outlined in paragraphs 3.2 and 3.3 of these Guidelines.
3.4 Prior to their conveyance, the Commission officer will place the suspected drug like substance/s in a tamper proof bag together with the Notice of Detention of PBS Drugs. The bag will then be sealed with a numbered rip grip seal[\[2\]](#_ftn2). The Commission will record the seal number on the Notice of Detention form prior to sealing the secure bag. For the conveyance of the drug like substance/s arrangements will be made with a secure courier service. This will be the responsibility of the Commission’s investigating officer. In these circumstances and for continuity of evidence purposes, the secure courier’s consignment notice will in effect form part of the evidentiary chain. In relation to Section 99ZK, where a person consigns an article for export, the same procedure as outlined above, applies. The only addition to this procedure is that the Commission officer should, where possible, obtain a copy of a “PBS Medicine Export Declaration”[\[3\]](#_ftn3) if present.

4. Consignment Notice
When using the services of a secure courier, the Commission officer will unsure that the number of the rip grip seal is recorded on the consignment notice together with his name, date and time of dispatch to the courier. On receipt of the consignment from the courier, the Commission investigating officer will check for continuity of the rip grip seal number and then record their name, date and time of delivery prior to signing for the consignment.

5. Administrative Process
5.1 The Commission officer shall forthwith make such enquiries as are necessary, to determine whether the detained drug like substance/s are subject to a payment under the Pharmaceutical Benefit Scheme.
5.2 A notice shall be served as soon as practicable on the exporter inviting a written application for the return or reconsignment for export of that drug like substance. The exporter shall be informed that if an application is not made within 60 days after the notification to the exporter, the Commission may seize and seek a court order for its condemnation. In addition the exporter shall be notified of the possible implications of criminal prosecution in relation to the export of the drug like substance, if the quantity of the drug like substance exceeds the quantity in sub-section 103 (4AA) of the Act.
5.3 If at any point within the 60 days the Commission determines that the detained drug like substance is not a prescription drug, or subject to a PBS benefit or is for personal use only, as described within the provisions of the Act, it shall, as soon as practicable be returned to the exporter or reconsigned for export. The cost of reconsignment for export shall be borne by the Commission.
5.4 In cases where drug like substances have been detained at International Mail Centres, where examination indicates that they should be reconsigned, etc., then the article shall be returned to the particular Mail Centre from where it was originally detained and handed over to ACS officers for reconsignment. In these cases, there should be no cost involved, as the consignor has already paid for postage.
5.5 Where a decision has been made to reconsign drug like substances that were detained as a result of a person travelling, the Commission will be responsible for packaging and postage costs for the return of the substances to an address provided by the owner. In
these circumstances and where reconsignment is to an overseas destination, the consignment should be taken by hand to the nearest International Mail Centre and the ACS staff informed of the reasons for reconsignment. This is to avoid the article coming under scrutiny at the Mail Centre.
5.6 If application has been made for the forfeiture and destruction and granted by a court, then disposal shall be in accordance with the Commonwealth Fraud Investigation Standards and PRD Investigation Guidelines.

6\. Treatment by the Commission of detained substances and retained documents
Section 99ZO Treatment by the Commission of detained substances and retained  
documents
(1) As soon as practicable after the Commission has taken possession  
of detained drug like substances, they must, pending their return,  
reconsignment or disposal, be taken to a place of security specified  
by the Managing Director.
6.1 For the purposes of the Act, the specified place will be a room within the Professional Review Branch dedicated for the retention and security of exhibits. Should detained drug like substances involve drugs of a perishable nature, then refrigeration will be required.
The Managing Director, of the Commission has nominated the following locations at which an Exhibit Room is established:

Health Insurance Commission, Professional Review Division, Central Office, 134 Reed Street, Tuggeranong, Australian Capital Territory.

Health Insurance Commission, Professional Review Branch, Colonial Tower, 150 George Street, Parramatta, New South Wales.

Health Insurance Commission, Professional Review Branch, 460 Bourke Street, Melbourne, Victoria.

Health Insurance Commission, Professional Review Office, 242 Liverpool Street, Hobart, Tasmania.

Health Insurance Commission, Professional Review Branch, 444 Queen Street, Brisbane, Queensland.

Health Insurance Commission, Professional Review Branch, 209 Greenhill Road, Eastwood, Adelaide, South Australia.

Health Insurance Commission, Professional Review Branch, 108 St George’s Terrace, Perth, Western Australia.

6.2 The Commission property officer shall ensure that the amount and type of drug like substance and any accompanying documentation is recorded in an Exhibit Register and lodged in the secure Exhibit Room.
All detained drug like substances will be recorded in the Professional Review Branch, Exhibit Register and then secured in a dedicated container within the Exhibit Room. (A dedicated container can be the drawer of a lockable filing cabinet or similar container.)
(2) If the Commission establishes, on examining detained drug like  
substances, that they are not prescription drugs and not prohibited  
exports, the Commission must, as soon as practicable:
(a) return the substances and any documents relating to the  
substances to the exporter; or
(b) reconsign the substances, and those related documents, for  
export; as the case requires.
Any costs associated with this procedure will be borne by the Commission.
(3) If the Commission establishes, on examining detained drug like substances, that they are prohibited exports, the Commission must forthwith pass the substances, any documentation relating to the substances, to the agency nominated in the guidelines issued under section 99ZS to deal with prohibited exports of that kind.
6.3 In cases where examination of detained drug like substances indicates that they may be prohibited exports such as Section 8 drugs, the ACS is to be notified as soon as possible. The substances and any documents relating to them are to be handed over to an officer of the ACS. The hand over procedure will involve the obtaining of a receipt from an officer of the ACS and the appropriate endorsements made in both the Professional Review Branch, Exhibit Register.
(4) If the Commission establishes, on examining detained drug like substances, that they are prescription drugs but not prohibited exports, the Commission must:
(a) notify the exporter, in writing, to that effect; and
(b) invite the exporter to apply in writing to the Commission, within 60 days after the notification, for the return of the substances on the basis that paragraph 99ZI(1)(b) or (c) or (2)(b) or (c) applies in relation to them.

For Commission purposes, the 60 days commences from the date that the Commission sends the notification to the exporter.
6.4 A brief of evidence seeking the condemnation of the drug like substances, as forfeited goods should be prepared as soon a possible after notification to the exporter.
(5) If the exporter does not make an application for the return within  
that period, then, at the end of that period and subject to subsection  
(6):
(a) the Commission is taken to have seized the substances; and
(b) the substances are taken to have been condemned as forfeited to the Commonwealth.
In these circumstances subject to a court order for the condemnation of the drug like substances, destruction of substances deemed condemned as forfeited to the Commonwealth shall not commence until 7 clear days after the date of expiry.
(6) If, before the day when substances would be taken to have been condemned as forfeited to the Commonwealth under subsection (5), proceedings for an offence involving those substances have been commenced, the substances are not to be taken to have been so condemned.
(7) If:
(a) the Commission establishes, on examining detained substances, that they are prescription drugs but not prohibited exports; and
(b) within 60 days after notification to that effect was given to the exporter, an application is made for the return of the substances; the Commission must consider the application and, not later than 120 days after the notification was so given:
(c) if it decides that it is satisfied that paragraph 99ZI(1)(b) or (c) or (2)(b) or (c) applies to the substances – must return the substances to the exporter or reconsign them for export; and
(d) if it decides that it is not so satisfied – must seize the substances as forfeited to the Commonwealth.
The 120 days referred to in this subsection will be taken from the date on the notification advice. In relation to sub-section (7)(d), a brief of evidence will be required.
(8) Despite the fact that substances are seized under subsection (7) as forfeited to the Commonwealth, the Commission must, subject to subsection (9) and any other law of the Commonwealth requiring their retention, destruction or disposal, return the substances to the exporter or reconsign them for export unless:
(a) not later than 60 days after the seizure, proceedings are commenced in a magistrates court for the condemnation of the substances as forfeited goods; and
(b) on completion of the proceedings, that court makes an order that the substances are condemned as forfeited to the Commonwealth.
(9) A court must not make an order for condemnation of substances under subsection (8) if proceedings for an offence involving the substances have been commenced.
(10) In any proceeding for the condemnation of substances as forfeited to the Commonwealth, a certificate by the Commission to the effect that the substances are prescription drugs within the meaning of this Division is prima facie evidence of that matter.
7. Disposal of forfeited substances
Section 99ZQ Disposal of forfeited substances
Substances that are taken to have been seized and condemned as forfeited to the Commonwealth under the provisions of sections 99ZO(5), 99ZO(7) or 99ZO(8) will be disposed of as directed at 10.5.3 of the Professional Review Division, Investigation Guidelines:
The case officer will be responsible for the proper disposal of all relevant property once the reason for its retention by the Commission no longer exists.
A court order directing the condemnation of the drug like substances must be in existence before the Commission officer proceeds to dispose of the drug like substances.

Section 99ZT Forfeiture of substances detained under section 99ZJ or 99ZK
All drug like substances that are transferred to the Commission under 99ZJ or 99ZK following their detention are forfeited to the Commonwealth unless:
(a) the substances are not prescription drugs; or
(b) the substances are prescription drugs and the exporter establishes:
(i) that no Commonwealth benefit has been paid or is payable; or
(ii) that the substances are for the personal use of the exporter or of a person accompanying the exporter.