From July 1, 2022, advertising for therapeutic products must comply with the new Code for Advertising of Therapeutic Products 2021, which came into force on January 1, 2022 (with a 6-month transition period which ended on June 30, 2022) [i]. In addition, any advertising of therapeutic products must comply with Australian Consumer Law.
Therapeutic product advertising compliance in Australia is complex and requires review of a number of advertising laws administered by different regulators. Knowing the advertising laws that apply to the marketing and advertising of a particular product or service is essential to avoiding violations that result in fines and legal action.
Therapeutic Products Advertising Code 2021
The Therapeutic Goods Advertising Code 2021 prescribes the minimum requirements for advertising therapeutic goods to consumers in Australia. Suppliers of therapeutic products cannot avoid complying with the Therapeutic Products Advertising Code by using websites hosted on servers located outside Australia for the advertising and supply of therapeutic products to consumers in Australia.
Key elements of the Therapeutic Products Advertising Code 2021 include:
1. General requirements for advertisements[ii] on therapeutic products to ensure that advertisements are accurate, balanced and not misleading and to promote the safe and appropriate use of products; are compatible with any indication(s) or destination(s) specified in the Australian Register of Therapeutic Goods (ARTG); and are consistent with public health campaigns.
Advertising claims presenting the goods “as safe, without danger, without side effects or effective in all cases, or a guaranteed cure; or infallible, unfailing, magical or miraculous”, are prohibited[iii].
Scientific or clinical representations may be used in advertisements, but must be expressed in such a way as to be easily understood by the intended audience and must be consistent with all scientific and clinical evidence applicable to the products[iv].
Advertisements may refer to scientific or clinical research, but advertisements must provide an appropriate citation for the research, the researcher must be identified, and financial sponsors of the research must be identified where known or should be known to the public. ‘advertiser.[v].
2. Mandatory declarations and other information requirements[vi] for advertisements
The Code specifies the various statements and information that must appear in advertisements for therapeutic products available only from pharmacists.[vii] and therapeutic goods that cannot be purchased by the general public and are only supplied to healthcare professionals[viii]. Abbreviated advertisements must also include a mandatory statement[ix].
In the case of online sales, where health warnings for therapeutic products on labeling and packaging cannot be physically viewed prior to purchase, advertisements must include relevant health warnings and other specified information in the Code.[x].
3. Additional requirements for specific therapeutic products
In the case of pain relievers, complementary medications, sunscreens and therapeutic products related to weight management, the code specifies additional requirements for the advertising of these products.[xi].
Complementary medicine advertisements containing one or more claims based on traditional use must include a statement prominently or communicated in the advertisement about reliance on traditional use[xii].
Advertisements for therapeutic products that make any weight management claim:
- must include prominently displayed or communicated statements or visual representations that promote the need for a “balanced energy diet and healthy physical activity”; and
- must not include any reference or representation suggesting that the therapeutic products will correct or reverse the effects of overeating or overconsumption of food or drink; and
- must not contain visual representations, statistics or testimonials from people that do not correspond to the results that one would expect to obtain on an average consumer of the products[xiii].
4. Testimonials and endorsements
Testimonials and endorsements may be used in advertisements for therapeutic products provided they comply with Code requirements and are not made by certain persons and organizations who are prohibited from providing testimonials and endorsements. .[xiv]. Persons prohibited from testimonial include those involved in the production, marketing and supply of therapeutic products, including influencers, direct sellers and other persons who will receive or have received valid consideration for giving a testimonial, as well that family members[xv].
The Therapeutic Goods Administration (TGA) has issued guidelines on the application of the Therapeutic Goods Advertising Code with respect to testimonials and endorsements in advertising[xvi].
The TGA publishes information and resources to help manufacturers, importers and other suppliers comply with advertising.
Advertising Compliance Programs Required for Advertising of Therapeutic Products
Advertising of therapeutic products must comply with the Therapeutic Products Advertising Code, the Australian Consumer Law and other laws. The complexity of these laws requires companies and advertisers to have effective internal advertising compliance programs that:
- Provide a good understanding of the Therapeutic Goods Act and Therapeutic Goods Advertising Code, Australian Consumer Law and other relevant laws that apply to the advertising of therapeutic goods, including prohibitions and restrictions on the advertising of therapeutic goods therapeutic products and the exemptions that apply.
- Enable individuals to evaluate and determine whether a product is a “therapeutic good” and subject to compliance with the Therapeutic Products Act and Therapeutic Products Advertising Code.
- Provide information regarding ARTG listing or registration requirements for products that are “therapeutic goods”.
- Provide ongoing monitoring of guidelines, warnings and communications issued by the TGA and the Australian Competition and Consumer Commission relating to the advertising and supply of therapeutic or consumer goods.
- Provide ongoing training and education regarding compliance with advertising laws, including Therapeutic Products Advertising Code and Australian Consumer Law.
- Require review of advertising materials by internal or external legal experts prior to publication to ensure advertising complies with applicable laws.
Example of cases involving breaches of the Therapeutic Products Act and Australian Consumer Law
Lorna Jane’s recent “LJ Shield – Anti-Virus Activewear” advertising and marketing campaign provides an example of how an advertising campaign can result in violations and penalties imposed under both product law therapeutics and Australian consumer law.
The Therapeutic Goods Administration (TGA) issued Notices of Violation totaling $39,969.00, for violations of the Therapeutic Goods Act and Therapeutic Goods Advertising Code. The TGA alleged that Lorna Jane Pty Ltd (Lorna Jane), by advertising its sportswear as “anti-virus sportswear” and offering protection against infectious diseases like COVID-19, misrepresented its sportswear sport as a “therapeutic good” and therefore had to comply with the Therapeutic Products Act and the Therapeutic Products Advertising Code. All therapeutic products must be approved by the TGA and registered with the Australian Register of Therapeutic Goods (ARTG) before they can be marketed and supplied in Australia. Lorna Jane hadn’t sought TGA approval before making the claims[xvii].
Lorna Jane and her manager, Ms Clarkson, have also been sued by the Australian Competition and Consumer Commission (ACCC) for making false or misleading statements in breach of sections 18, 29 and 33 of Australian law on consumption, in connection with the promotion and supply of its product under the name of “LJ Shield -Anti-Virus Activewear”. The Federal Court of Australia ordered Lorna Jane to pay A$5 million in penalties for the traffic ticket[xviii]. During the court proceedings, Lorna Jane made a number of confessions, including:
- He falsely represented that his LJ Shield Activewear “eliminates”, “stops the spread” and “protects wearers” against viruses, including COVID-19″.
- He made the misleading representation on his website, Facebook and Instagram, press releases, emails and in-store signage.
- He falsely represented that he had a scientific or technological basis for making the “anti-virus” claim regarding his LJ Shield Active Wear;
- Its director, Ms. Clarkson, had authorized and approved the promotional material and had participated in the writing of the words and the development of the images for the marketing campaign.[xix].