Manufacturers of herbal highs and recreational drugs will now be responsible for proving their products are safe before they can be sold.
Associate Minister of Health Peter Dunne said new regulations reverse "the onus of proof" by making all party pills and other herbal highs illegal until they are proved safe for sale.
"If they cannot prove that a product is safe, then it is not going anywhere near the marketplace," Dunne said.
The Temporary Class Drug Notices, which was put in place as a holding measure until the bill is passed, will be rolled over as required so there is no window of opportunity for any banned substances to come back on the market before the permanent law comes in.
"The new law means the game of 'catch up' with the legal highs industry will be over once and for all."
He said distributers and producers will have to pay for the cost of proving that a product is safe.
Ross Bell, New Zealand Drug Foundation's executive director, said the industry should have to jump through hoops to prove their products are safe.
"The new regulations, which place the burden on the industry to prove its products are low risk, are long overdue and are very welcome.
"Mr Dunne has helped slay the party pill hydra."
In the past year the Government has seen a 75% fall in the number of emergency call incidents around synthetic cannabis products, according to National Poisons Centre data.
"That decline began the very month the Notices came into effect," Dunne said.
Dunne said the Government has banned more than 28 substances and "effectively taken more than 50 products that contain them off the market".
"We are winning the battle and we are about to deliver the knockout blow with this legislation," he said.
Dunne said Cabinet has agreed to establish a new regulator within the Ministry of Health, which will be responsible for issuing approvals.
He said that any companies wishing to sell these products will need to apply to this regulator with scientific data similar to what is required for the assessment of new medicines.
"For example, they would need to provide toxicology data and results of human clinical trials."
Even once approved, the products are likely to be subject to retail restrictions which will further reduce their potential to cause harm, he said.
"The details of these restrictions have not yet been agreed, but I fully expect that they will involve a legal minimum purchase age and restrictions on the types of premises where they can be sold.
The legislation will be introduced later this year and is expected be in place by August 2013.
Has the Minister got it right with its crackdown on party pills? Leave a comment below.