Why Biotechs Run First-in-Human Trials in Australia

Ask a US biotech where it ran its first-in-human study and there is a good chance the answer is Melbourne, Sydney or Brisbane. Australia has built a reputation as the place to get a new molecule into people quickly, at a reasonable cost, with data that FDA can use. This post explains why, what to watch for, and how TGA approval pathways work if you later want to market the product in Australia.

Why Australia Wins on Early-Phase Trials

Australia started 1,850 clinical trials in 2022, with about 90,000 participants. Phase 1 trials were the fastest-growing segment, up about 9.5% a year from 2015 to 2022, while Phase 3 activity was flat. Industry sponsored about 35% of trials, and only 9% of industry drug trial sponsors were headquartered in Australia, a sign of how much work comes from overseas (MTPConnect, 2024).

Four things drive this: a light-touch regulatory start, a generous tax offset, data FDA will accept, and fast site start-up. Let’s take each in turn.

The CTN Scheme: Ethics Review, Not Regulator Review

Most trials of unapproved medicines in Australia run under the Clinical Trial Notification (CTN) scheme. The TGA is clear: it does not evaluate any data about the trial at the time of notification. Instead, an HREC approves the protocol, the site’s Approving Authority grants governance approval, and the Australian sponsor lodges the CTN and pays the fee before supplying the product. Recruitment does not need to wait for TGA acknowledgement (TGA, CTN scheme).

The alternative, the Clinical Trial Approval (CTA) scheme, involves TGA evaluation before the trial starts. It is mandatory for Class 4 biologicals, with some exceptions, so cell and tissue products may follow a different route.

Timelines are short. Law firm Corrs puts typical CTN approval at four to eight weeks (Corrs Chambers Westgarth). Clinical Leader reports most projects move from final protocol to first patient in two to three months (Clinical Leader, 2025). In the MTPConnect report, one global sponsor said first patients typically enrol about three months after approvals in Australia, versus six to nine months in the US or EU.

“Australia does not skip the science. It moves the first review to the ethics committee and lets you start sooner.”

The R&D Tax Incentive

For companies with aggregated turnover under A$20 million, the R&D Tax Incentive provides a refundable offset equal to the corporate tax rate plus 18.5% (business.gov.au). For a company taxed at the 25% base rate, that is 43.5 cents back for every eligible dollar. Because it is refundable, pre-revenue biotechs receive it as cash. Larger companies get a non-refundable offset instead. You must register activities within 10 months after the end of the income year.

Overseas work is harder to claim. You need a positive overseas finding before the end of the income year in which the work happens. The overseas activity must support an Australian core activity, must not be possible in Australia for reasons such as missing facilities or populations (cost alone does not count), and must cost less than the related Australian R&D (business.gov.au). Plan this early if your drug product is made in the US or Europe.

FDA Acceptance and Other Practical Advantages

You do not need an IND to dose patients in Australia. Under 21 CFR 312.120, FDA accepts a well-designed, well-conducted foreign study not run under an IND if it follows GCP, including independent ethics committee review and informed consent, and if FDA can validate the data through an onsite inspection if needed (21 CFR 312.120). Many sponsors use Australian Phase 1 data to support a later US IND.

• Reverse seasons. Southern hemisphere winter lets sponsors of influenza and other respiratory products recruit during the northern summer.
• Exchange rate. Clinical Leader cites a 30% to 40% cost advantage from the exchange rate alone.
• Standard contracts. Industry template agreements and standard cost lists shorten site negotiations.
• Strong networks. Australia has dozens of national trial groups in oncology, neurology and rare diseases.

What to Plan For

• Local sponsor. Every trial needs an Australian sponsor. A foreign company without a subsidiary must use an Australian CRO or partner, for a fee (Corrs).
• Product quality. Australia may accept GMP-like rather than fully GMP-compliant product for first-in-human studies. That can cause friction when the data reach FDA or EMA, so manufacture to the standard your later filings will need.
• Population size. Australia’s small population is ideal for healthy volunteer and small patient studies but can struggle with rare disease or large Phase 2 cohorts. Plan sites in other regions early.
• FDA alignment. Consider a pre-IND meeting before your Australian study ends so dose escalation, safety monitoring and endpoints match FDA expectations.

TGA Approval Pathways for Medicines and Biologics

Running trials in Australia is fast. Getting a product approved in Australia is a different question. The TGA offers several expedited pathways for prescription medicines and biologicals (TGA, 2025).

Pathway	TGA Target	Key Feature
Standard	220 working days	Full TGA evaluation
Priority review	150 working days	Serious conditions, major benefit
Provisional	220 working days	Early data; up to 6 years
COR-A	120 working days	Relies on comparable overseas approval
COR-B	175 working days	Partial reliance on overseas review

Provisional registration lasts two years and can be extended twice, to a maximum of six years, while confirmatory data are collected (TGA, provisional approval). Project Orbis, an FDA-led program for cancer drugs, lets the TGA review alongside FDA, Health Canada, Swissmedic, the MHRA and others. The Access Consortium links the TGA with Health Canada, Singapore’s HSA, Swissmedic and the MHRA for work-sharing.

What This Means for Biotech Sponsors

For an early-stage biotech, Australia can cut months off the path to human data and return a large share of the cost as cash. The catch is in the details: a local sponsor, product quality that will satisfy FDA later, an overseas finding for offshore work, and a clear plan for where Phase 2 and Phase 3 will run.

Terraforme Biosciences helps sponsors plan first-in-human strategy, align Australian studies with FDA expectations and map TGA registration pathways. Learn more about our regulatory guidance services.

The Bottom Line

Australia’s appeal is simple: ethics-led trial start-up, a refundable R&D offset and data FDA can accept. Use it to reach the clinic fast, and plan the rest of the global program from day one.