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Advertising of Medicines – Not playing by the rules?

Therapeutic Goods Administration
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In our last article we discussed some of the laws surrounding in-pharmacy promotions and explained what you will need to look out for when advertising pharmaceutical goods.

The focus of this month’s article is on the enforcement powers the TGA has when it comes to non-compliance with the Therapeutic Goods Act and the Therapeutic Goods Advertising Code and how these powers have previously been applied in practice.

Summary of TGA’s powers

While the TGA has the overall responsibility with regard to complaints about therapeutic goods advertisements, the Therapeutic Goods Regulations now divert some of the TGA’s powers to the Complaints Resolution Panel.
The combined powers of the TGA and the Panel under the Regulations include:

  • Issuing orders to require a non-complying pharmacy to withdraw an advertisement or particular representation, to destroy all advertising material containing a particular claim or representation and to publish a retraction or correction of such advertisement.
  • Issuing prevention notices to the person responsible for the publication of an advertisement which is false or misleading to prevent that person from publishing that particular advertisement.
  • Requesting written undertakings in which the non-complying pharmacy undertakes to do or not to do certain things to ensure compliance with the Act. This could for instance include undertakings not to publish advertisements containing particular claims or representations that may otherwise breach the requirements of the Act.

Further, although the current regulatory framework does not expressly provide for sanctions against pharmacists that fail to comply with the orders set out above, the TGA has the power to issue infringement notices requiring the payment of a fine. Additionally, and most importantly, non-compliance with any prescribed orders may, in some cases, even lead to criminal prosecution under section 42DM of the Act.

TGA’s powers applied in a recent case

Earlier this year, the Panel found that Chemist Warehouse did not comply with several provisions of the Therapeutic Goods Advertising Code in that its ‘health information’ web pages provided general advice in relation to various health conditions combined with links to branded vitamin products that Chemist Warehouse was offering for sale.

Chemist Warehouse argued that its web pages were analogous to a newspaper that contained both articles and advertisements on the same page and, thus, were not “advertisements” to which the Code applied. The Panel however rejected this argument and found the web pages as a whole were advertisements for the purpose of the Code and that the Code’s advertising provisions were contravened by Chemist Warehouse.

As a result, the Panel ordered Chemist Warehouse to withdraw its advertisements and publish a retraction in place of its advertisements along the lines of the following:
“We unlawfully made prohibited representations implying that products could aid in the treatment and/or prevention of serious conditions, diseases and disorders.”

Chemist Warehouse, however, has not yet published such retraction and indicated it is likely to challenge the Panel’s decision should this result in further action by the TGA. The TGA warned Chemist Warehouse that any “further breach or non-compliance will result in investigation with appropriate regulatory action if required.”

There has been no further report of the result of this case. However, the offending web pages seem to have been taken down.

Another recent case

There is only one other recent reported case involving a pharmacy. Coincidentally it also involved Chemist Warehouse which, in 2012, published newspaper advertisements stating that “Generic Lipitor (Atorvastatin Sandoz) is now available from $0 and thereafter at $14.99.”
The Supreme Court of Queensland found that the advertisements constituted misleading and deceptive conduct under the Australian Consumer Law for the following reasons:

  1. The advertisements failed to identify the following:
    • That the supply of discount generic products (Trovas at $19.99, and Atorvastatin Sandoz) would not count as spend under the schedule of the Pharmaceutical Benefits Scheme (PBS).
    • That Lipitor at the listed price of $35.40 would count for the purposes of potential availability of prescription drugs at concessional prices under the PBS (in this case, Lipitor would be available at a concessionary rate of $5.80 for those general patients who pay more than $1,363.30 on PBS scripts within a year).
  2. Chemist Warehouse claimed that the frequency of supply of Atorvastatin Sandoz or Trovas at the above prices would be governed by standard PBS regulations, when supplies of those products at those prices would not be supplies under the PBS.

TGA and the Price Information Code of Practice 2006

The TGA also considered the matter under the Price Information Code of Practice 2006, which regulates the publication of prices of prescription and certain pharmacist-only medicines.  This Code provides that price information in promotional material must include a sufficient number of medicines, from three or more sponsors and no promotional emphasis shall be given to any medicine referred to in such price information.
The TGA found that Chemist Warehouse was in breach of the Price Information Code since it had presented information about Atorvastatin Sandoz in a way that gave it prominence over and above any other medicine included in the price list.
This case reinforces the importance of ensuring you do not omit any relevant pricing information and that no special preference is given to one drug over others.

Lessons learned

Although we are yet to see whether further sanctions will be imposed upon Chemist Warehouse in respect of its website advertising, you should always be mindful that the TGA has wide ranging powers.
A breach of the advertising provisions of the Code is, after all, a criminal offence and consequences of publishing a non-compliant advertisement may be serious depending on the type of breach.

Thus, to avoid negative consequences for your pharmacy business, you should always seek specialised legal advice before publishing any advertisements or information that is provided to your customers generally. 


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