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16 November 2018

A tighter prescription for advertisers: The Therapeutic Goods Advertising Code (No.2) 2018 (New Code)

Any business that advertises non-prescription therapeutic goods to consumers must comply with the requirements of the Therapeutic Goods Advertising Code.  At a high level, the Code regulates:

  • what you may say and what you must say about therapeutic goods in advertisements; and

  • who you are allowed to advertise therapeutic goods to (eg. prohibitions/restrictions on marketing certain products to children).

The Therapeutic Goods Advertising Code 2015 (Old Code) setting out these requirements is about to be replaced by the New Code and there are various changes under the New Code that companies should consider.

When does the New Code come into effect?

The New Code (except for Part 4 of Schedule 1) will come into effect on 1 January 2019. Part 4 of Schedule 1 dealing with mandatory statements for ingredients in registered or listed medicines will commence on 1 September 2020.

What changes under the New Code?

Some of the more interesting and important changes under the New Code include:

  • the requirement to substantiate all information presented in advertisements before they occur;

  • changes to mandatory statements for pharmacist-only medicines;

  • new provisions relating to goods that are not available for physical examination before purchase;

  • new requirements relating to public health campaigns;

  • additional requirements about advertising weight management products; and

  • changes to the restrictions on advertising therapeutic goods primarily to children.

Substantiating information

Under the New Code, all information presented in advertising must be substantiated before the advertising occurs.  This imposes a higher standard on advertisers compared to the Old Code which allowed for some information to only have to be capable of substantiation in certain circumstances. Advertisers will now have to be able to show that they took steps to ensure the accuracy of all information before advertising.

Pharmacist-only medicines

One of the more interesting changes under the New Code is its acknowledgement of the role of the pharmacist in the decision-making process regarding the use of certain ‘over the counter’ therapeutic goods (namely the ones containing substances listed in Schedule 3 of the Poisons Standard (Pharmacist-only Medicines)).

Under the Old Code, advertisements for Pharmacist-only Medicines were required to contain the statement ‘YOUR PHARMACISTS ADVICE IS REQUIRED’. Under the New Code, advertisements for Pharmacist-only Medicines are required to include the statement ‘ASK YOUR PHARMACIST – THEY MUST DECIDE IF THIS PRODUCT IS RIGHT FOR YOU’.

This seems to place the decision-making power and responsibility of assessing whether Pharmacist-only Medicines should be used in the treatment of a patient’s condition in the hands of the pharmacist, as opposed to having them perform an advisory role. While this may not affect advertisers, it does appear to reflect the changing role of pharmacists in the treatment of certain illnesses (rightly or wrongly).

Therapeutic goods that are not available for physical examination before purchase

Section 12 of the New Code includes various new requirements that apply to the advertisement of therapeutic goods to consumers where the consumer does not get the opportunity to examine the relevant goods prior to (or at the time of) purchase (eg. goods sold online or via mail order catalogues). Essentially the New Code incorporates and adds to the new information and labelling requirements under the Therapeutic Goods Order No.92 – Standard for labels of non-prescription medicines (New Labelling Order).

Under the New Code, advertisements for medicines sold in this manner must display similar information to that required under the New Labelling Order. That is, the name of the good, the name of the dosage form, the quantity of the good, the indications of the good and the list of its ingredients, etc., as well as any relevant mandatory statements which differ depending on whether a health warning applies (eg. ALWAYS READ THE LABEL). Similarly, new information requirements (and mandatory statement requirements) also apply for advertisements for medical devices and other therapeutic goods (that are not medicines) that are sold in this manner.

Public health campaigns

The New Code requires advertisers to ensure that their advertisements are consistent with public health campaigns (see section 21 of the New Code).

This obliges advertisers to be familiar with all public health campaigns relevant to their products and ensure their advertising does not contradict them.

Sunscreens are one example of the type of product likely to be impacted by this requirement (eg. government campaigns in relation to skin cancer and sun protection).

Weight management products

Section 26 of the New Code prevents advertisers of weight management products from:

  • making claims that include any reference or depiction suggesting the product will correct or reverse the effects of overeating or drinking; or

  • using images of individuals such as ‘before and after’ pictures, testimonials or statistics about individuals, in an advertisement unless the results achieved by those individuals from the use of those goods would be expected to be achieved on average by users of the goods.

Advertising to children

The New Code prohibits advertisers from directing advertisements primarily to children under 12. Further, advertising may only be directed primarily to children over 12 if the product is listed in Schedule 2 of the New Code.

This imposes a higher standard on advertisers by completely prohibiting primary advertising to children under 12. Although the Old Code prohibited directing advertising to children under 18, some goods (those listed in Appendix 5 of the Old Code) were exempt and could potentially be primarily advertised to all children, including those under 12.

Penalties for failing to comply with the New Code under the Therapeutic Goods Act 1989 (Cth) (TGA Act)

Failure to comply with the New Code could result in:

  • criminal penalties such as fines of up to $840,000 and imprisonment for up to 5 years (for example see sections 42DL and 42DM of the TGA Act); and

  • civil penalties of up to $1,050,000 for individuals and up to $10,500,000 for companies (for example see sections 42DLB and 42DMA of the TGA Act).

Take home message

The New Code places various new requirements on advertisers of non-prescription therapeutic goods to consumers.  With the imminent commencement of the New Code, companies who advertise therapeutic goods to consumers should audit their marketing material and approval procedures to ensure compliance.

If you get it wrong, the penalties could be substantial.


Author: Matthew Wilson

Further contact: Michael Cossetto

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