Background

Advertising of therapeutic goods requires a higher ethical standard than may apply to advertising of ordinary consumer goods because consumers rely on therapeutic goods for their health. It can be difficult for a consumer to determine the appropriateness of a therapeutic good for their circumstances, so it is important that promotional material is truthful, balanced and not misleading.

Because of the danger involved in the ingestion of drugs, any person (including any companies) advertising therapeutic goods to consumers must comply with the requirements for advertising.

The Therapeutic Goods Administration (TGA) operates under the federal Department of Health and Aged Care. The TGA is responsible for regulating the advertising of therapeutic goods by administrating the Therapeutic Goods Act 1989 (Cth) (the act), the Therapeutic Goods Regulations 1990 (Cth) (the regulations) and the Therapeutic Goods Advertising Code (No.2) 2018 (the 2018 code).

The code was amended such that from 1 July 2022, advertisers are required to ensure advertisements comply with the Therapeutic Goods (Therapeutic Goods Advertising Code) Instrument 2021 (the 2021 code).

The code exists to ensure that the advertising of therapeutic goods to the public is conducted in a manner that:

• Promotes the safe and effective use of therapeutic goods by minimising misuse, overuse, or underuse.

• Is ethical, does not mislead or deceive the consumer or create unrealistic expectations about product performance.
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• Supports informed health care choices.

• Is not inconsistent with relevant current public health campaigns.

Like other regulatory agencies, the TGA may receive reports from health specialists or concerned members of the public regarding suspected non-compliant advertising. On the TGA website, there is an online form for such reporting. Ensuring compliance with the advertising requirements of the act across the medicinal industry has remained a priority for the TGA, moreso when a nascent medicinal product. For example, in 2022–23, the TGA issued 101 infringement notices (totalling $1,292,040) for alleged unlawful advertising of medicinal cannabis.

The code was instituted pursuant to section 42BAA of the act. There are criminal offences and civil penalties for advertising to the public in a manner that does not comply with the code. The administration collects information concerning alleged breaches of the code. The TGA particularly frowns upon unlawful advertising, as it may be seen to promote narcotics, and undertakes: criminal prosecutions, with the assistance of the Commonwealth Director of Public Prosecutions (DPP); and civil litigation, if appropriate, for the recovery of civil penalties.

Consequences of breaking the law

There are serious consequences for failing to comply with the requirements and any direction from the TGA to address non-compliant advertising. Senior officers of companies advertising therapeutic goods should also be aware that, in some circumstances, they may be personally liable for unlawful conduct by the company if they are aware that the company will breach the law, were able to prevent that breach, and failed to take reasonable steps to do so: Secretary, Department of Health v Evolution Supplements Australia Pty Ltd [2021] FCA 74.

The act provides for a range of criminal offences, some of which are punishable by up to five (5) years imprisonment and attract fines of up to $840,000 for an individual or $4.2 million for a body corporate.

Further, the legislation provides for civil penalties involving a penalty amount of up to $1.05 million for an individual or $10.5 million for a body corporate. In a civil penalty case brought by the TGA, the Federal Court awarded $10 million in civil penalties in relation to contraventions of the advertising provisions under the act: Secretary, Department of Health v Peptide Clinics Australia Pty Ltd [2019] FCA 1107.

Nicholas Collier is a practitioner admitted in the Supreme Court of Queensland, the High Court of Australia, and the High Court of New Zealand. He currently works at the Legal Services Commission.