Prevention notice: Contract Manufacturing & Packaging Services Pty Ltd

Material finding of fact and reasons for direction

I make the following material findings of fact.

1. Background
   1. On 15 September 2021, the TGA received a complaint from a member of the public regarding Contract Manufacturing and Packaging Services Pty Ltd (the Company) promoting a listed therapeutic good, 'Facia Premium' (AUST L 295927) (the Medicine) for use in skin lightening by advertising the claim on its label. The complainant alleged that the claim was false or misleading as to proper use of the Medicine. The complaint further alleged that the Medicine was manufactured in Australia for export purposes.
   2. As a result of this complaint, a post-market compliance review was initiated to determine whether the label of the Medicine contravened the advertising requirements in the TG Act.
   3. On 19 October 2021, the TGA sent a Request for information (RFI) notice to the Company issued under subsection 31(2) of TG Act. In this notice, the TGA requested information about current in-use labels, supply status of the Medicine, the number of units of the Medicine held by the Company and the number of units of the Medicine that had been supplied to consumers, retailers, distributors and wholesalers that are within expiry.
   4. On 15 November 2021, the Company responded to the RFI by providing the requested information.
   5. On 18 November 2021, the TGA requested further information, including whether the Company had labels that are used for export purposes and if so, requested that these labels be provided.
   6. On 19 November 2021, the Company responded by providing discontinued versions of the labels which were claimed to have been used for export batches of the Medicine. Some of those labels (the Labels) contained the claim, 'skin lightening formula'.
   7. On 24 November 2021, the TGA requested the Company provide further clarification to the RFI response including certain information about the batches of the Medicine where the Labels were used.
   8. On 1 December 2021, the Company responded by providing the following information for the affected batches:
      1. Dates of manufacture
      2. Number of units manufactured
      3. Number of units exported
      4. Batch numbers
      5. Expiry dates
2. Material findings of fact
   9. Contract Manufacturing & Packaging Services Pty Ltd is an Australian Proprietary Company, Limited by Shares and has been provided with Australian Business Number (ABN), 70 092 250 596 and Australian Company Number (ACN), 092 250 596 as its unique registration number.
   10. The Medicine is a therapeutic good within the meaning of subsection 3(1) of the Act, and has been included in the Australian Register of Therapeutic Goods (ARTG) as a listed therapeutic good under section 26A of the TG Act since 6 November 2017.
   11. The Company, as the sponsor of the Medicine, is the person responsible for advertising the Medicine via the label of the Medicine.
   12. The Medicine is manufactured in Australia for export purposes.
   13. The Labels, which were applied to batches of the Medicine manufactured up to March 2020, stated that the Medicine was a 'skin lightening formula'. The Company voluntarily discontinued use of the Labels in March 2020 without prior contact from the TGA.
   14. The claim, 'skin lightening formula' is an indication within the meaning of subsection 3(1) of the Act.
   15. As of 9 December 2021, following permitted indications are accepted in relation to the inclusion of the Medicine in the ARTG:
       1. Antioxidant/Reduce free radicals formed in the body
       2. Helps reduce/decrease free radical damage to body cells
       3. Maintain/support collagen formation
       4. Maintain/support natural liver cleansing/detoxification processes
       5. Helps convert (state food) into energy
       6. Maintain/support energy production
       7. Maintain/support healthy eye function
       8. Maintain/support eye health
       9. Maintain/support healthy eyesight/vision
       10. Maintain/support body mucous membrane health
       11. Maintain/support general health and wellbeing
       12. Maintain/support hair health
       13. Maintain/support healthy teeth
       14. Decrease/reduce nail brittleness/splitting/chipping in females
       15. Maintain/support nail health/strength/thickness
       16. Enhance/improve/promote/increase nail health/strength/thickness in females
       17. Maintain/support connective tissue health
       18. Aid/assist/helps connective tissue production/formation
       19. Maintain/support bone health
       20. Aids/assists healthy bone development/growth/building
       21. Maintain/support blood capillary health
       22. Maintain/support blood vessel health
       23. Maintain/support immune system health
       24. Maintain/support healthy immune system function
       25. Aid/assist/helps glucose/sugar/carbohydrate metabolism
       26. Aid/assist/helps protein synthesis in the body
       27. Maintain/support absorption of dietary (state vitamin/mineral/nutrient)
       28. Helps prevent dietary (state vitamin/mineral/nutrient) deficiency
       29. Aid/assist/helps metabolism of (state vitamin/mineral/nutrient)
       30. Aids/assists the body to cope with environmental stress
       31. Support healthy stress response in the body
       32. Maintain/support cognitive function/mental function in healthy adults
       33. Maintain/support nerve conduction
       34. Aid/assist/helps synthesis of neurotransmitters
       35. Maintain/support nervous system health
       36. Maintain/support nervous system function
       37. Maintain/support nervous system function
       38. Maintain/support female reproductive system health
       39. Maintain/support preconception health in healthy females
       40. Maintain/support healthy reproductive hormones
       41. Maintain/support skin health
       42. Maintain/support skin integrity/structure
       43. Maintain/support skin regeneration
       44. Maintain/support wound healing
3. Reasons for decision
   16. My reasons for making the Notice are set out below.

   Power to issue Notice

   17. Subsection 42AC(2) of the TG Act provides that sections 42DKB, 42DLA and 42DLC, among others, apply in relation to advertisements solely for therapeutic goods that have been exported or are intended exclusively for export.
   18. Subsection 42DKB(1) of the TG Act provides that if the Delegate is satisfied that a representation in an advertisement about therapeutic goods is false or misleading the Delegate may, by notice given to a person apparently responsible for advertising the therapeutic goods or causing the advertising of the therapeutic goods, prevent that person from advertising the therapeutic goods, or causing the advertising of the therapeutic goods, in circumstances where the advertisement contains that representation (whether in express terms or by necessary implication).

   The Medicine is a therapeutic good

   19. The Medicine was presented (via the Labels) as having therapeutic uses for supporting healthy hair, skin integrity and as an antioxidant.
   20. I am therefore satisfied that the Medicine is a therapeutic good within the meaning of subsection 3(1) of the TG Act as goods 'represented in any way to be… for therapeutic use'.

   The Company is apparently responsible for advertising or causing the advertising of the Medicine

   21. I am satisfied that the Company is apparently responsible for advertising or causing the advertising of the Medicine by way of the Labels.
   22. In this respect, I note that subsection 3(1) of the TG Act provides that 'advertise', in relation to therapeutic goods, 'includes make any statement, pictorial representation or design that is intended, whether directly or indirectly, to promote the use or supply of the goods, including where the statement, pictorial representation or design is on the label of the goods'.
   23. For the above reason, I am satisfied that the Labels are an advertisement for the Medicine, as they were intended to promote the use or supply of the Medicine by claiming that the Medicine has therapeutic effect for skin lightening, maintenance of healthy skin and hair, collagen formation and antioxidant.

   The Labels contain a false or misleading representation

   24. The Labels contained both the claim, 'skin lightening formula' and the listing number for the Medicine (AUST L 295927). Having regard to the overall presentation of the Labels, including the prominent skin lightening claim, the prominence of statements that the Medicine is made in Australia, and the presence of the listing number for the Medicine, I am satisfied that the Labels represented that:
       1. the Medicine, being the therapeutic good entered in the ARTG under AUST L 295927, is indicated for skin lightening;
       2. the Australian regulator of therapeutic goods, being the TGA, has accepted skin lightening as an indication in relation to the entry for the Medicine in the ARTG under AUST L 295927; and
       3. the Australian regulator of therapeutic goods, being the TGA, accepts or permits the advertising of the Medicine for skin lightening.
   25. One of the defining characteristics of a medicine listed in the ARTG is the indications for that medicine. Where a medicine has different indications to a listed medicine, that medicine will be treated under the TG Act as a separate and distinct therapeutic good from the listed medicine (subsection 16(1A) of the TG Act and regulation 11 of the Therapeutic Goods Regulations 1990).
   26. Additionally, subsection 28(5)(ab) of the TG Act imposes a condition of listing that the listing-holder for a listed medicine must 'not, by any means, advertise the subject goods for an indication other than those accepted in relation to the inclusion of the goods in the Register'. This reflects the importance of sponsors ensuring that therapeutic goods are promoted in a manner consistent with the entry for those goods in the ARTG.
   27. The ARTG entry for the Medicine includes three permitted indications that refer to therapeutic benefits for skin outlined in paragraphs [oo] - [qq]. None of these indications relate to, or otherwise imply that the Medicine is for therapeutic use for, skin lightening.
   28. Consequently, I am satisfied that the Medicine entered in the ARTG under AUST L 295927 is not indicated for skin lightening, and that a skin lightening indication is not accepted by the TGA in relation to that entry in the ARTG. I am further satisfied that the TGA does not accept or permit the promotion of the Medicine for skin lightening, noting the condition of listing imposed under subsection 28(5)(ab) of the TG Act. I therefore find that each of the representations listed at paragraph 27.a. to c. above was false or misleading.

   Compliance history of the Company

   29. The Company has a long history of interaction with the TGA and compliance history in relation to medicines under their sponsorship. The Listing Compliance Section of the TGA has conducted 10 separate compliance reviews of select medicines under their sponsorship occurring between 2015 and 2021. Seven of these medicines have a record of non-compliance with requirements of the Act. As such, the sponsor has a non-compliance rate of 70%.
   30. The contraventions of the Act that were identified in the above reviews include advertising therapeutic goods for an indication other than those accepted in relation to the inclusion of the goods in the ARTG, holding insufficient information or evidence to support particular indications proposed to be accepted in relation to the inclusion of the goods in the ARTG, reference to an un-approved or non-permitted restricted representation and non-compliance with the Labelling Order for non-prescription medicines.
   31. As such, I consider that the Company had received sufficient information and guidance from the TGA to assist them to meet their regulatory obligations under the Act. I have decided to give the Company a notice under section 42DKB of the Act in relation to this matter.

   Conclusion

   32. Having regard to the above, I am satisfied that the Labels, being an advertisement for the Medicine, contained representation about the Medicine that is false or misleading, and that you are the person apparently responsible for advertising the Medicine.
   33. I have concluded, having regard to the background to this matter as set out above, that it is necessary and appropriate to prevent you from advertising the Medicine, or causing the advertising of the Medicine, in circumstances where the advertisement contains the claim 'skin lightening' (whether in express terms or by necessary implication).
   34. In this respect, I note the importance of ensuring that therapeutic goods are only advertised for the indications in relation to which they are entered in the ARTG. I also note that skin lightening is not an indication included in the Therapeutic Goods (Permissible Indications) Determination (No. 1) 2021, and therefore is not permitted to be used in relation to listed medicines. In those circumstances, noting the past promotion of the Medicine for the skin lightening indication, I consider it necessary to put in place this notice as a preventative measure to ensure that false or misleading statements of this kind are not made in future (whether on the labelling of the Medicine or otherwise).
   35. Please note that failure to comply with this Notice, whether the advertisement in question is made in relation to goods for use in Australia or goods solely for export, is a criminal offence under section 42DLA of the TG Act, punishable by sentences of up to 5 years' imprisonment and fines of up to $4.44 million for a body corporate, or $888,000 for an individual. Contraventions of this Notice may also give rise to civil penalties, under section 42DLC of the TG Act, of up to $11.1 million for a body corporate or $1.11 million for an individual.

Effect of not complying with this/these directions

Contravening a notice given under subsections 42DKB(1) of the TG Act, is a criminal offence under section 42DLA of the TG Act, and may give rise to civil penalties under section 42DLC, which could lead to court action against you.

The TGA could also issue you an infringement notice as an alternative to these actions.

In conjunction with pursuing civil or criminal sanctions, the TGA may also seek an injunction from a Federal Court to immediately cease your advertising.

The TGA can also issue directions concerning failures to comply with a notice issued under section 42DKB of the TG Act, or alert the public to its concerns about particular therapeutic goods advertising through the use of public warning notices (sections 42DV and 42DY).

Please Note:

Subsection 42DKB(3) states

As soon as practicable after giving a notice under subsection (1), the Secretary must cause the Notice to be published on the Department's website.

Relevant extracts from the Therapeutic Goods Act 1989

Therapeutic Goods Act 1989

Part 5-1 - Advertising and generic information

Division 3A - Advertising offences and civil penalties

42DKB Certain representations not to be advertised

Advertisements

1. If a representation in an advertisement about therapeutic goods is false or misleading, the Secretary may, by notice given to a person apparently responsible for:
   1. advertising the therapeutic goods; or
   2. causing the advertising of the therapeutic goods;
      prevent that person from advertising the therapeutic goods, or causing the advertising of the therapeutic goods, in circumstances where the advertisement contains that representation (whether in express terms or by necessary implication).

Generic information

2. A notice under subsection (1) is not a legislative instrument.

Publication

3. As soon as practicable after giving a notice under subsection (1), the Secretary must cause the notice to be published on the Department's website.

42DLA Advertising offences – contravening section 42DKB notice

1. A person commits an offence if:
   1. the Secretary has given a notice to the person under section 42DKB in relation to therapeutic goods; and
   2. the person does an act or omits to do an act; and
   3. the act or omission contravenes the notice; and
   4. either:
      1. the use of the goods has resulted in, will result in, or is likely to result in, harm or injury to any person; or
      2. the use of the goods, if the goods were used, would result in, or would be likely to result in, harm or injury to any person; and
   5. the harm or injury has resulted, will result, is likely to result, would result, or would be likely to result, because of the contravention.

   Penalty: Imprisonment for 5 years or 4,000 penalty units, or both.

2. A person commits an offence if:
   1. the Secretary has given a notice to the person under section 42DKB; and
   2. the person does an act or omits to do an act; and
   3. the act or omission contravenes the direction or a condition of the direction.
3. A person commits an offence if:
   1. the Secretary has given a direction to the person under subsection 42DV(1) or (2); and
   2. the person does an act or omits to do an act; and
   3. the act or omission contravenes the direction or a condition of the direction.
4. An offence against subsection (3) is an offence of strict liability.

42DLC Civil penalty relating to advertisements – contravening section 42DKB notice

A person contravenes this section if:

1. the Secretary has given a notice to the person under section 42DKB; and
2. the person does an act or omits to do an act; and
3. the act or omission contravenes the notice.

Maximum civil penalty:

1. for an individual - 5,000 penalty units; and
2. for a body corporate - 50,000 penalty units.

Export only labels - 19 November 2021