Influencing for profit – the new Therapeutic Goods Advertising Code 2021 – what you need to know

Key points

• The new Therapeutic Goods Advertising Code 2021 (2021 TGA Code) brings changes to a number of obligations and requirements regarding advertising of therapeutic goods in Australia.
• Between 1 January 2022 and 30 June 2022, the 2021 TGA Code is in a transition period, meaning advertisers can choose to comply with either the existing 2018 TGA Code or the 2021 TGA Code.  Come 30 June 2022, all advertising of therapeutic goods in Australia must comply with the 2021 Code.
• The 2021 TGA Code brings changes to the rules regarding testimonials provided by persons receiving valuable consideration in exchange for the testimonial. This will have significant impact for social media influencers and companies utilising these advertising methods.

Overview

The 2021 TGA Code came into effect on 1 January 2022. While many changes under the 2021 TGA Code seek to clarify and simplify the 2018 TGA Code, there are also a number of key changes. 

The 2021 TGA Code makes changes to the requirements regarding mandatory statements that must be made in advertising material, includes additional products which may be provided as samples to the general public, and further clarifies that it is an offence to provide valuable consideration to a person providing a testimonial such as social media influencers. Each of these key changes is discussed further below.

Despite commencing earlier this year, the 2021 TGA Code is in a transition period for six months ending on 30 June 2022.  During the transition period, advertising can comply with either the existing 2018 TGA Code or the 2021 TGA Code. Practically, this means there is an impending deadline for advertisers of therapeutic goods to review their materials and practices to ensure compliance from 1 July 2022. 

Advertisers who do not comply with the 2021 TGA Code from 1 July 2022 risk committing an offence under section 42DM, or breaching the civil penalty provisions under section 42DMA, of the Therapeutic Goods Act 1989 (Cth).

Mandatory statements

The 2021 TGA Code has removed the table of health warnings previously contained in schedule 1 of the 2018 TGA Code, with mandatory statements including health warnings now specified in Part 4 of the 2021 TGA Code.

The 2021 TGA Code requires advertisers to prominently display or communicate mandatory statements in a range of circumstances, for instance:

• advertisements for therapeutic goods which are only available through a health professional must contain the mandatory statement ‘this product is not available for purchase by the general public’;
• advertisements for therapeutic goods only available through a pharmacist must contain the mandatory statement ‘ask your pharmacist about this product’; and
• short form advertisements (which is defined specifically to not include social media advertisements) must include the statement ‘always follow the directions for use’.

Changes have also been made in relation to therapeutic goods which can be physically viewed and inspected by a consumer prior to purchase, and those goods which cannot – for example, online sales of therapeutic goods. Where goods cannot be physically inspected, warnings, or links to warnings, must be prominently published in the advertisement at the point of purchase.

Samples

The 2021 TGA Code expands on the previous list of therapeutic goods that may be offered as a sample together with an advertisement about therapeutic goods. 

The full list of samples is included in Annexure 2 of the 2021 TGA Code, and notably includes a number of COVID-19 related goods such as:

• rapid antigen tests;
• sanitisers and disinfectants; and
• face masks and gloves.

The expanded list now also includes:

• oral hygiene products including toothpaste and mouthwash;
• lancets and blood glucose strips for use in connection with measuring blood glucose;
• tampons and menstrual cups; and
• personal lubricants.

Testimonials and endorsements

Under Part 6 of the 2021 TGA Code, testimonials about therapeutic goods are not permitted if the provider of the testimonial received, or will receive, valuable consideration in exchange for the review. 

Further, advertisements about therapeutic goods must not contain a testimonial provided by any ‘influencers, direct sellers, and other persons who have, or will receive, valuable consideration for making the testimonial’. However, notably this does not permit influencers from making paid endorsements (rather than testimonials), in certain circumstances.

Advertisers must have verified the content of, and the identify of the person making the testimonial before it can be used to advertise therapeutic goods. Practically, this may require an advertiser of therapeutic goods to obtain a statutory declaration of the person making the testimonial. The TGA website provides that advertisers will be responsible for ensuring the compliance of any testimonial that is publicly posted by third parties to social media platforms where the advertiser has control of the content.  Advertisers should carefully monitor testimonials and remove non-compliant testimonials.

Another implication of the 2021 TGA Code is that any testimonial that was obtained for valuable consideration must no longer be used on and from 1 July 2022. This will require advertisers of therapeutic goods to conduct an audit of existing advertising materials to ensure compliance.

The 2021 TGA Code also prohibits the use of testimonials from persons who are engaged in the production, marketing or supply of the goods. The term ‘engaged in’ is broad and could capture a very wide range of persons. Similarly, ‘valuable consideration’ could be read broadly to include any paid travel associated with obtaining the testimonial for instance to travel to partake in filming.

Endorsements must not be given by a government or government authorities, hospitals or healthcare facilities (other than a community pharmacy) or the employees of government, government authorities, hospitals or healthcare facilities, current or former health practitioners, professionals and medical researchers, or persons representing themselves to have training or qualifications to diagnose, treat or prevent disease, ailments, defects or injuries in persons. Further, organisations that represent the interests of healthcare consumers or medical professionals, practitioners and researchers must not provide an endorsement unless the advertisement discloses, the name of the organisation and whether the organisation has received, or will receive, any valuable consideration for the endorsement.

What should advertisers of therapeutic goods do?

Advertisers of therapeutic goods should use the transition period to review current advertising material and marketing practices and policies to ensure they are and will be compliant with the 2021 TGA Code moving forward.

To the extent that samples are intended to be offered, including in conjunction with advertisements, advertisers may wish to consider whether the expanded list of permitted samples allows an opportunity to provide additional types of samples.

Advertisers should ensure that all applicable online, screen and voice-based advertising contains the relevant mandatory statements that align to the specific products being advertised.

Advertisers should also consider whether any of their existing advertising used would offend the new testimonial provisions. For future advertising, advertisers should ensure that robust procedures are in place to ensure that no consideration is provided in exchange for a testimonial.

Influencers and brand owners should also seek advice on the new rules, particularly relating to testimonials and endorsements, to ensure compliance with the 2021 TGA Code.

If you have any questions, or would like to arrange a review of your advertising material, or discuss the new requirements, please do not hesitate to contact a member of the McCullough Robertson Life Sciences team: Belinda Breakspear