Last week Justice Edelman delivered judgment in the Federal Court, finding that Reckitt Benckiser (Australia)’s packaging and website descriptions of the Nurofen ‘Specific Pain Range’ constituted misleading or deceptive conduct under section 18 of the Australian Consumer Law (‘ACL’).

Reckitt Benckiser was found to have represented that the four products in the Nurofen Specific Pain Range were each specifically formulated to target a particular type of pain when, in fact, each product was identical in composition.

Consequently, Justice Edelman ordered, by consent, that Reckitt Benckiser remove all Nurofen Specific Pain Range products from sale within three months. Further orders included publishing a corrective notice, implementing a relatively extensive consumer protection law compliance program and paying the ACCC’s costs. The penalty enforced will be decided by the Federal Court at a later date. The ACCC has previously indicated that it will be seeking the maximum possible penalty.

The decision is Australian Competition and Consumer Commission v Reckitt Benckiser (Australia) Pty Ltd (No 4) [2015] FCA 1408.

BACKGROUND

In March 2015, the Australian Competition and Consumer Commission (‘ACCC’) instituted proceedings against Reckitt Benckiser in the Federal Court, alleging that the packaging and website descriptions of the Specific Pain Range contravened the ACL.

Reckitt Benckiser markets and sells Nurofen products, including the Specific Pain Range. Comprising four colour-coded products each targeting a different pain, namely, back pain, tension headache, migraine pain and period pain, the Specific Pain Range claims to ‘relieve pain with the right types of pain medication’. For example, the back pain medication was branded as below:

Click here to view the image

It was argued that consumers paid a premium: the Specific Pain Range is double the price of Nurofen’s general pain relief product. However, beyond the packaging and the cost, the differences are scarce (if any).

Each product contains the same amount of active ingredient, being ibuprofen lysine 342mg. Each product is of the same formulation, equally effective in treating all the types of pain described in the Specific Pain Range and has the same approval from the Australian Register of Therapeutic Goods (‘ARTG’), as follows:

The temporary relief of pain and/or inflammation associated with headache (including migraine and tension headache), dental pain, period pain, arthritis, aches and pains associated with the common cold or flu, backache, sinus pain, muscular and rheumatic pain. Reduces fever.

The packaging of each product included a generic statement that the product provides ‘fast targeted relief from pain’ and ‘is fast and effective in the temporary relief of pain associated with …’ followed by the relevant pain: back pain, tension headache, migraine pain and period pain.

In addition to the product packaging, from around December 2012 until May 2014, the Nurofen website contained a product comparison page. The page consisted of a table comparing each pain relief product with ticks, indicating that a particular product targeted its corresponding pain. For example, Nurofen caplets were represented as being suitable for all types of pain, whereas ‘Nurofen Period Pain Caplets’ were represented as exclusively being suitable for period pain.

PROCEEDINGS

Following an adjournment at the commencement of the trial, Reckitt Benckiser admitted to contravening sections 18 and 33 of the ACL – engaging in misleading or deceptive conduct and engaging in conduct that is liable to mislead the public as to the nature, characteristics or suitability of the Nurofen Specific Pain Range products for their purpose.

Justice Edelman held that the packing and website representations of the Specific Pain Range infringed sections 18 and 33 of ACL because:

  1. each product contains the same active ingredient;
  2. the ARTG approved indications for each product is the same;
  3. each product is of the same formulation; and
  4. no product is any more or less effective than the others in treating any of the symptoms shown on the packaging.

The ACCC and Reckitt Benckiser agreed to the proposed orders, the terms of which were generally adopted by Edelman J, with some amendments.

THE RESULT?

  1. The four orders made by Justice Edelman encompassed a number of different aspects. Designed to signal the Court’s disapproval of the conduct, vindicate the ACCC’s claim, deter companies from engaging in future misleading and deceptive conduct and inform consumers, The ACCC were successful in securing an injunction restraining further breaches.
  2. Reckitt Benckiser was ordered to issue a corrective notice and advertising both online and in a widespread national newspaper, The Australian;
  3. An order was made requiring Reckitt Benckiser to amend its existing compliance program to reduce the prospect of future breaches – including appointing a compliance officer, issuing a compliance policy, and developing a complaints handling system;
  4. An order that Reckitt Benckiser pay the ACCC’s costs.

As noted above, the Court will decide on a penalty at a later date.

WHAT DOES THIS MEAN?

Brand owners in the medicine and health industry should exercise care when marketing their products, particularly when making unproven health claims. The ACCC has previously identified such conduct as a ‘new priority area’, and has signalled its general intention to seek maximum penalties. Following its recent Federal Court success, it is likely the ACCC has other healthcare companies on its radar and will continue to crack down on misleading and deceptive conduct within the industry.

With the issue of penalties yet to be decided, whether the ACCC will be successful in achieving its mandate of maximum penalties remains to be seen. Watch this space!