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14 February 2019

The Therapeutic Goods Act: Assuming it doesn’t apply to you may be bad for your health

The Therapeutic Goods Act 1989 (Cth) (TGA Act) and its accompanying regulations, orders, determinations, guidelines and standards (the TGA Regulatory Regime) applies to a wide range of products sold in Australia. Yet often the people making or selling them are not aware of this.

That may in part be because the TGA Act doesn’t just apply to products classed as ‘therapeutic goods’ because of their ingredients or components (eg. prescription medicines, biologicals or medical devices), it also applies to various products that are either represented as being for a ‘therapeutic use’ or, because of how they are presented (eg. in advertisements), are likely to be taken by a consumer to be for therapeutic use.

So what’s a ‘therapeutic use’?

The TGA Act defines ‘therapeutic use’ as being use in or in connection with:

  • preventing, diagnosing, curing or alleviating a disease, ailment, defect or injury;

  • influencing, inhibiting or modifying a physiological process;

  • testing susceptibility to a disease or ailment;

  • influencing, controlling or preventing conception;

  • testing for pregnancy; or

  • replacing or modifying parts of the anatomy.

Put simply, if the product goes on or in you to diagnose or help with something that’s wrong with you, or to prevent something from going wrong, there’s a chance it falls under the TGA Regulatory Regime.

Products which many people wouldn’t realise are regulated include certain sunscreens, acne treatments, soaps, anti-perspirants and hair products (like some anti-dandruff shampoos).

Are there any exceptions?

Broadly speaking, there are two types of exceptions:

  • partial exceptions (meaning that some of the requirements under the TGA Regulatory Regime will not apply to the product, but others will); and

  • complete exceptions (meaning the TGA Regulatory Regime will not apply to the product at all).

Partial exceptions

Therapeutic goods that are partially exempt from the operation of the TGA Regulatory Regime are specified under Schedules 5, 5A and 7 of the Therapeutic Goods Regulations 1990 (Cth).

The ‘Exempt Goods’ specified under Schedule 5 are not required to be listed or registered in the Australian Register of Therapeutic Goods (ARTG), but they are still regulated by other parts under the TGA Regulatory Regime (for example the Part 5-1 provisions of the TGA Act dealing with advertising and the Therapeutic Goods Advertising Code).

Examples of these products include certain types of:

  • acne treatments;

  • disinfectants;

  • lotions; and

  • anti-dandruff shampoos,

provided they are not for (or advertised as being for) the treatment, cure, prevention, diagnosis or monitoring of, or testing susceptibility of people to, a disease, condition, ailment or defect.

Many of the same products specified in Schedule 5 are also specified under Schedule 7 as exempt from the operation of Part 3-3 of the TGA Act, which deals with manufacturing requirements, as long as they are not supplied as pharmaceutical benefits.

Schedule 5A exempts some medicines and medical devices from the listing and registration requirements in limited circumstances; for example, where they are to be used in clinical trials, provided they meet specific sponsorship conditions and record keeping requirements.

Complete exceptions

Products that fit within the definition of ‘therapeutic good’ but are not regulated by the TGA Regulatory Regime are set out in the new Therapeutic Goods (Excluded Goods) Determination 2018 (Determination) which came into effect on 1 October last year.  The Determination is a legislative instrument made under section 7AA of the TGA Act and it replaced the Cosmetics Standard 2007.

What does the Determination do?

Essentially, the Determination is a legislative list of products that are not regulated by the TGA Regulatory Regime. In other words, the requirements of the TGA Regulatory Regime do not apply to them. These products are defined under the Determination as ‘Excluded Goods’.

The Determination consists of two schedules namely:

  • Schedule 1 which specifies goods that are completely excluded (eg. no specific advertising, presentation or usage restrictions apply). Examples include hair bleaches, hair dyes, hair-colorants, dental bleaches and dental whiteners; and

  • Schedule 2 which specifies goods which are only excluded from the operation of the TGA Regulatory Regime if they comply with specific advertising, presentation or usage restrictions placed on those goods under the Determination. For example, moisturising skin care products that contain sunscreen with a SPF rating of between 4 and 15, are Excluded Goods, provided that the only therapeutic claims made in relation to those products are limited to those in relation to premature ageing in connection with sun exposure.

Suppliers of Excluded Goods listed under Schedule 2 need to familiarise themselves with the Determination and take care to avoid therapeutic claims in their advertising or presenting the products in a way that goes beyond the scope of the Determination.

Said another way, how you advertise a product could determine whether the TGA Regulatory Regime applies to your product.

If my product is excluded under Schedule 1 of the Determination, does that mean I can say whatever I like because it isn’t regulated by the TGA?

No.  The TGA Act places general restrictions (and in some circumstances prohibitions) on claims made in connection with the treatment of serious diseases, conditions, ailments or defects.  Furthermore, the TGA Regulatory Regime is not the only regulatory regime that applies to the advertising of products to consumers.  Advertisers of Excluded Goods must still comply with other advertising codes of conduct and legislation, including requirements under the Australian Consumer Law.

What happens if I advertise my Schedule 2 Excluded Good in a way that goes beyond what the Determination says I can say or do?

In this case, the product will no longer be an Excluded Good. This probably means the TGA Regulatory Regime will apply in whole or in part (depending on what ingredients are in the product and the way in which the product is presented).

If my product is a therapeutic good what do I need to do?

If the product is regulated as a therapeutic good under the TGA Regulatory Regime, three of the most critical things to consider are:

  • whether it needs to be listed or registered in the ARTG;

  • if you are manufacturing the product, whether you need a licence (or conformity assessment certificate) under the TGA Act to be able to lawfully manufacture the relevant product; and

  • whether any advertising restrictions apply (eg. Therapeutic Goods Advertising Code which deals with advertising non-prescription therapeutic goods direct to consumers, or the Medicines Australia Code of Conduct, which deals with advertising prescription products to healthcare professionals).

What are the risks?

If you are advertising, supplying, manufacturing, importing or exporting a therapeutic good without giving any consideration to the TGA Regulatory Regime, you are at risk of contravening the TGA Act.

What are the consequences?

Depending upon which sections of the TGA Act have been contravened, the penalties that could apply include:

  • criminal penalties such as fines (which could be as high as $840,000 per offence) to terms of imprisonment up to a maximum of 5 years for most criminal offence sections (and even up to 7 years for certain offences such as those relating to the destruction of documents required to be retained under the TGA Act); and

  • civil penalties as high as $1,050,000 for individuals and $10,500,000 for companies.

The specific penalties that will apply will also be dependent upon the following factors:

  • how many times you have contravened each relevant section(s);

  • the way in which you have contravened the relevant section(s) (eg. the seriousness of the contravention and the risk of harm or injury that it poses to the public); and

  • whether you have contravened the TGA Act previously.

The Take Home Message

If you are thinking about selling a product in Australia that will be:

  • used on or in people to diagnose, prevent or treat any adverse health or physiological condition;

  • advertised with claims that it diagnoses, prevents or treats any adverse health or physiological condition (or has some other health benefit); or

  • advertised in a way that may lead someone to use it to diagnose, prevent or treat any adverse health or physiological condition,

you should seek advice to determine whether your product will be regulated under the TGA Regulatory Regime.

Don’t let a warning letter (or, worse, an infringement or investigation notice) from the Department of Health be your introduction to the regime.

Author: Matthew Wilson

Further contact: Michael Cossetto

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