Can the ACCC 'target the source' of misleading labelling?

Regular readers of this column will know that I’ve been less than complimentary about the effectiveness of the Therapeutic Goods Administration (TGA) in its efforts to regulate advertising of non-prescription products.

I am therefore delighted to give some credit when good news breaks. The Australian Consumer and Competition Commission (ACCC) has succeeded in a Federal Court action to have misleading packaging of Nurofen products banned.

The manufacturer Reckitt Benckiser (Australia) Pty Ltd has three months to remove all its misleadingly packaged Nurofen products from shelves. This outcome has taken five years from the time CHOICE magazine awarded Nurofen a Shonky Award for the labelling. The TGA first ordered them to withdraw the claim in 2011.

Following a final TGA review in 2012 which backed up the original finding, Reckitt Benckiser effectively dared the TGA to force them to change their ways. It was announced in March this year that following the failure of the TGA to get an outcome, the ACCC would pursue it using their consumer protection powers.

Today’s outcome is entirely predictable, from a scientific point of view. There was never any merit to the claim that ibuprofen could in any way be said to “go straight to the site of pain” any more than a sprinkler system in a high-rise building goes straight to the cause of a fire.

So why didn’t Reckitt Benckiser change their branding when ordered to?

My guess (and I emphasise this is speculation) is that they understood that there has never been a prosecution by TGA under the Therapeutic Goods Act 1989 because the derisory penalties aren’t worth paying good public money to enforce.

Once Reckitt Benckiser have paid their lawyers and costs, I’m guessing they will be well in front after selling the offending products for four years longer than they were supposed to. They have also had four extra years to gather marketing data and optimise their plan for rebranding.

It was inevitable that they were going to have to change their indefensible labelling, but why jump until you’re about to be savagely pushed?

Another example of the contempt in which the TGA is held was in 2013 when Swisse vitamins had an “appetite supressant” product banned by TGA only to re-register the exact same pills as a “hunger control” product. They only made the change after the TGA threw everything they had at them. Yet it was as easy as that to shrug off all the bluster the regulator could work up.

The example Reckitt Benckiser has set in defending its misleading and unfair consumer strategy with Nurofen will be noted by other companies, and the lesson will not be lost on them if they are next in the ACCC’s sights. The tactic is to fight in the courts for as long as the ACCC has the will to spend taxpayers' money in order to buy time to plan the exit strategy and get a few more months or years of benefit from the dodgy claims. Milk the cash cow until the law closes in, then cop it sweet and move on.

Australian consumers will continue to be ripped off and fleeced as long as we are represented by a TGA which has not been given the tools to do its job. Neither side of politics is very interested in legislative change because the big players are just fine with it how it is. The real problem is that the same legislation that makes the TGA a tough-but-fair sheriff as far as prescription drugs and devices go also renders it flabby and supine enough to be unable to seriously hamper the sales targets of the non-prescription sector.

The foxes of the health-care industry may not be directly in charge of the hen house, but no holes in the wire are getting fixed without them giving the nod.