Influencers finally regulated when promoting therapeutic goods

Social media influencers can be important channels for advertisers to reach large volumes of consumers.  The new Therapeutic Goods Advertising Code 2021 (Cth) (2021 TGA Code) came into effect on 1 January 2022, bringing about a number of changes to the regulatory framework for advertising therapeutic goods.  The new 2021 TGA Code provides changes to the rules regarding testimonials for therapeutic goods by social media influencers or anyone else receiving valuable consideration for their endorsement.  This article discusses the new changes introduced by the 2021 TGA Code and liability for non-compliance.

What is a therapeutic good?

The Therapeutic Goods Administration (TGA) is the regulatory body in Australia that regulates medicines and products that are marketed as having a “therapeutic” effect.  This includes most skin-whitening lotions, disinfectants, primary sunscreens, blood products and complementary medicines.

Section 3 of the Therapeutic Goods Act 1989 (Cth) (Act) provides a definition of therapeutic goods.  Therapeutic goods can comprise a broad range of things, including herbal remedies, pregnancy test kits, bandages, paracetamol and tissue grafts.  Generally therapeutic goods fall under three (3) categories:

• Medicines – including prescription, over the counter and complementary medicines, such as echinacea and paracetamol;
• Biologicals – something made from or containing human cells or tissues, such as human stem cells or skin; and
• Medical devices – including instruments, implants and appliances, such as pacemakers and sterile bandages.

The TGA is responsible for evaluating, assessing, and monitoring products that are defined as therapeutic goods in the Act.

Changes introduced by the 2021 TGA Code when advertising Therapeutic Goods

The 2021 TGA Code does not necessarily restrict social media endorsement of therapeutic goods by social media influencers, however advertisers and influencers (Advertisers) must ensure that any endorsement of a Therapeutic Good meets the regulations in the 2021 TGA Code.  The implications of the TGA Code 2021 for Advertisers are that paid or incentivised testimonials of Therapeutic Goods are prohibited.  This is regardless of whether the testimonial is genuine or if the payment to the influencer is disclosed.

Section 24(4) of the 2021 TGA Code does not prohibit influencers from making genuine unpaid testimonials about the therapeutic goods, but the Advertisers must not be “involved with the production, sale, supply or marketing of the goods” or receive any “valuable consideration” for the testimonial.  It must be noted that “valuable consideration” does not only refer to monetary payment and would include other incentives for influencers such as gifts, services and opportunities in exchange for the testimonial.

Advertisers may continue to endorse Therapeutic Goods under the 2021 TGA Code as long as the endorsement does not refer to the personal experience of the person making the endorsement, as this would be considered a testimonial.  Furthermore, endorsement of Therapeutic Goods must comply with the other provisions in the 2021 TGA Code.

Mandatory statements

Part 4 of the 2021 TGA Code specifies the mandatory statement requirements to be when advertising therapeutic goods.  This means that there is a requirement for all advertisers to communicate or prominently display these in particular instances.  Some circumstances include where an advertisement is:

• for a Therapeutic Good that is only available through a health professional, the mandatory statement, “this product is not available for purchase by the general public” must be included;
• for a therapeutic good that is only available through a pharmacist, the mandatory statement, “ask your pharmacist about this product” must be included; and
• a short form advertisement, which does not include social media advertisements, the mandatory statement, “always follow the directions for use” must be included.

When do the changes come into effect?

The 2021 TGA Code replaces the Therapeutic Goods Advertising Code (No.2) 2018 (Cth) (2018 TGA Code).  However, between 1 January 2022 and 30 June 2022, both the 2021 TGA Code and the 2018 TGA Code will be in effect.  During this transition period, advertisers have discretion as to whether they apply the 2021 TGA Code or the 2018 TGA Code.

From 1 July 2022, the 2018 TGA Code will no longer be in effect and all advertising will be assessed against the 2021 TGA Code requirements.

Who is responsible for enforcing non-compliance?

Under the 2021 TGA Code, it is the responsibility of the Advertiser, which may be a brand, to ensure that testimonials comply.  A person or brand will be responsible for ensuring compliance of testimonials that are posted on social media platforms by third parties where the Advertiser has control of the content.  The TGA may commence action for breaches of the 2021 TGA Code and maintains a list of advertising enforcement and outcomes.

Takeaways

There are some steps that Advertisers can take to ensure they comply with the new rules.  Influencers and advertisers should ensure that non-compliant content is removed by 30 June 2022 and that future advertising, even if the brand pays for it, is not a testimonial, but rather an endorsement that complies with the 2021 TGA Code.

Links and further references

Legislation

Therapeutic Goods Act 1989 (Cth)

Therapeutic Goods Advertising Code (No.2) 2018

Therapeutic Goods Advertising Code 2021 (Cth)

Further information about the 2021 TGA Code

If you need advice on compliance with the 2021 TGA Code, contact us for a confidential and obligation-free discussion:

Disclaimer

This article contains general commentary only.  You should not rely on the commentary as legal advice.  Specific legal advice should be obtained to ascertain how the law applies to your particular circumstances.

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