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Australian Regulatory Guidelines for Advertising Therapeutic Goods (ARGATG)

Guidance for advertisers

13 November 2019

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Sanctions and penalties for non-compliant advertising

This guidance for advertisers applies to the current Therapeutic Goods Advertising Code 2015 but incorporates amendments to the Therapeutic Goods Act 1989 (the Act) that came into effect on 6 March 2018, and has been further updated to provide specific information on advertising biologicals and to also include more background information on advertising requirements.

The Therapeutic Goods Advertising Code (No.2) 2018 was made on 31 October 2018 to replace the 2018 Code which will come into effect on 1 January 2019. A summary of the changes is available. To assist advertisers with implementation, we have also published guidance material; Complying with the Therapeutic Goods Advertising Code (No. 2) 2018.

TGA's approach to compliance is described in the Regulatory Compliance Framework. This framework allows us to escalate actions to achieve compliance, depending on the severity of the non-compliance and your attitude towards compliance.

We have the authority to use various enforcement tools if your advertising does not comply with requirements. We can apply these actions at any time, even if your advertisement was not brought to our attention by a complaint. These actions can have various consequences for you as the advertiser ranging from mild to very serious.

We may take any of the following actions when advertising is found to be non-compliant:

*As of 1 July 2017, the value of a penalty unit is $210. The value of a penalty unit is listed in the Crimes Act 1914.

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We may send you a letter or visit you in person to educate you or your staff on advertising requirements for therapeutic goods. You may choose to engage with a regulatory affairs consultant or a lawyer to assist you in ensuring your advertisement complies with all relevant requirements. You should implement procedures to ensure that all future advertising meets relevant requirements to avoid further or more serious compliance action.

We may refer:

We may send you a warning letter requesting that you amend your advertisement to ensure compliance within a specified timeframe. We will then confirm with you whether the advertisement has been made compliant. If you fail to address the compliance issues identified in the warning letter, we may escalate the compliance action.

We may use substantiation notices to request information to establish the person responsible for an advertisement or to obtain information to substantiate claims made in an advertisement. If you receive a substantiation notice from us, you must provide the information we have requested.

If you fail to comply with a substantiation notice, we may publish a warning notice under section 42DY to alert the public to possible advertising issues or prosecute you under section 42DS of the Act. This carries a maximum penalty of 500 penalty units* (in 2017-18, $105,000).

Providing false or misleading information in response to a substantiation notice can also be prosecuted with a maximum penalty of 1000 penalty units* and/or 12 months imprisonment. We may also pursue civil action for the provision of false or misleading information (section 42DT of the Act).

The Secretary of the Department of Health directs you to take steps to address non-compliant advertising and/or retract or correct your advertising.

If you fail to comply with a direction, it may result in criminal prosecution or civil proceedings.

We will publish directions on the TGA website.

You can request a review of a direction issued under section 42DV of the Act.

Under the Act, we can suspend or cancel your therapeutic good from the ARTG on the basis of advertising non-compliance. Suspension or cancellation is limited to cases where the sponsor of the therapeutic good is responsible for the non-compliant advertising.

If we suspect that there has been a breach of the legislation in relation to the advertising of the therapeutic good, we can issue a written notice to the public containing a warning about the advertised goods, if it is satisfied that it is in the public interest to issue the notice.

We can also issue a public warning notice if you fail to comply with a substantiation notice and it is in the public interest to issue such a notice.

Infringement notices will have a maximum 12 penalty units* for an individual or 60 penalty units* for an incorporated body for non-compliant advertising.

In 2017-18, this will result in fines of $2520 for an individual and $12,600 for an incorporated body.

We may issue multiple infringement notices, depending on the number of non-compliances identified. Even if the notice is paid, you will need to address the non-compliant advertising that resulted in the infringement notice in order to avoid future criminal or civil proceedings.

Under certain circumstances, and where it is clear that the advertiser wants to comply, we may accept the offer of an enforceable undertaking instead of pursuing court action when an offence or civil penalty provision in the legislation has been, or is likely to be, breached. If we accept the undertaking, you are bound by the terms agreed to in the undertaking. Terms may include mandatory training of your staff and taking the steps needed to ensure compliance of any future advertising.

A breach of the terms may result in the matter being referred to the Federal Court who can make orders under section 42YL(5) of the Act.

If you are convicted by a court for advertising non-compliance (including failure to comply with a direction from the Secretary), penalties may be up to:

  • imprisonment for 5 years or 4,000 penalty units*, or both, where the use of the goods in reliance on the advertisement has resulted in, will result in, or is likely to result in, harm or injury to any person; or the use of the goods in reliance on the advertisement, if the goods were so used, would result in, or would be likely to result in, harm or injury to any person
  • imprisonment for 12 months or 1,000 penalty units*, or both, for intentional non-compliance
  • 100 penalty units* for strict liability offences (where intent does not need to be demonstrated)

Offences by corporations can also attract a 5x multiplier.

We may pursue multiple advertising offences. There is also provision for continuing offences (i.e. increased penalties for each day of non-compliance following notification of compliance issues).

If a court finds that you have failed to comply with the relevant advertising requirements or directions, it can impose civil penalties up to a maximum of:

  • 5,000 penalty units* for an individual; or
  • 50,000 penalty units* for a body corporate

for each contravention.

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