It was a brilliant marketing strategy … instead of marketing the fast-acting Nurofen for pain relief as one product effective for a range of pains (as the standard Nurofen is marketed), to market it as four products targeted to specific pains, namely migraine pain, tension headache, period pain and back pain. It’s known as segmenting the market.

This marketing strategy was undone as misleading as a result of the recent decision of the Federal Court of Australia (Edelman J) in Australian Competition and Consumer Commission v Reckitt Benckiser (Australia) Pty Ltd (No 4) [2015] FCA 1408 (11 December 2015).

This is a commentary on the how the marketing strategy was undone.

The Nurofen marketing strategy

Nurofen is an over-the-counter medicine for the temporary relief of pain which has been sold in Australia in pharmacies since the late 1980s and in grocery stores since the early 2000s. In 2006, Nurofen introduced a Specific Pain Range with four products, marketed in tablet blister packs as follows:

  1. Nurofen - Migraine Pain in a pack coloured violet
  2. Nurofen - Tension Headache in a pack coloured burgundy
  3. Nurofen - Period Pain in a pack coloured magenta
  4. Nurofen - Back Pain in a pack coloured green

The words “Fast targeted relief from pain” appeared prominently on the packs.

The Nurofen website had a product comparator table which contained a list of different types of pain. It posed the ‘informative’ question “What product is right for you, your pain and your body?” The table indicated that Nurofen products were suitable for the relief of all types of pain listed. But that for specific relief of Migraine Pain, Tension Headache, Period Pain and Back Pain, the pack labelled for the specific pain should be chosen.

Images of the packs and the website pages are reproduced in the judgment which can be accessed by clicking here.

According to a Nurofen spokesperson “The Nurofen specific-pain range was launched with an intention to help consumers navigate their pain relief options, particularly within the grocery environment where there is no healthcare professional to assist decision making.”

Details of the Reckitt Benckiser marketing strategy remain confidential as a result of orders made in interlocutory proceedings to protect the confidential information. The confidentiality of the marketing strategy documents produced by Reckitt Benckiser was protected – see Australian Competition and Consumer Commission v Reckitt Benckiser (Australia) Pty Ltd (No 3) [2015] FCA 1406. The confidentiality of the market research documents produced by The Nielsen Company, was protected – see Australian Competition and Consumer Commission v Reckitt Benckiser (Australia) Pty Ltd (No 2) [2015] FCA 1274.

Therefore we can only speculate that the marketing strategy was to segment the “pain market” by creating a “Nurofen Specific Pain Range” of products to target four of the most common types of pain. Market research would have indicated that consumers will choose specific pain relief products in preference to general pain relief products. And at point of sale, by having four different packs, the products would have four times the shelf space.

The marketing strategy was successful, which caught the attention of the Australian Consumer and Competition Commission (the “ACCC”), which instituted civil prosecution proceedings for misleading conduct.

Why the Nurofen marketing strategy contravened the Australian Consumer Law

Reckitt Benckiser admitted two contraventions of the Australian Consumer Law (the “ACL”) when the trial commenced, namely section 18 (misleading and deceptive conduct) and section 30 (misleading representations as to the nature, characteristics or the suitability for their purpose, of the products).

The particular representations which contravened the ACL were that each product in the Nurofen Specific Pain Range:

  1. Was specifically formulated to treat the particular type of pain specified on the packaging relevant to that product; and
  2. Solely or specifically treated the particular type of pain specified on the packaging relevant to that product.

These representations were misleading because the products in the Nurofen Specific Pain Range were all the same, in that:

  1. Each product contains the same active ingredient, namely ibuprofen lysine 342mg (lysine speeds up the absorption of ibuprofen);
  2. The Australian Register of Therapeutic Goods (ARTG) approved indications for each product are the same (that is, 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).
  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 of the products in the Nurofen Specific Pain Range.

When instituting the proceedings, the ACCC highlighted that the retail prices for the range was “around double that of Nurofen’s standard ibuprofen products and standard products of its competitors”. At the trial, the ACCC did not pursue this price discrepancy as being in contravention of the ACL.

The Court orders

Reckitt Benckiser’s agreement with the ACCC to admit to two contraventions of the ACL avoided a hearing, and importantly, avoided possible adverse findings by the judge.

Reckitt Benckiser also agreed with the ACCC to certain court orders, which with amendments made by the Court were made as follows:

  • Cease shipment, distribution or sale of the products in their ‘offending packaging’ within four weeks;
  • Use its best endeavours to remove the products in their ‘offending packaging’ from retail outlets within three months*;
  • Be restrained from selling, marketing or promoting the products in the ‘offending packaging’ or other packaging which contravenes the ACL for three years;
  • Publish a corrective notice (in the form specified) on its website within 14 days and in The Australian newspaper within 21 days;
  • Ensure that its existing consumer protection law compliance program meets the requirements, and maintain the program for 3 years;
  • Pay the ACCC’s legal costs in the proceedings.

A hearing is to take place on the pecuniary penalties to be paid by Reckitt Benckiser for the contraventions of the ACL. The considerations in setting the penalties will be similar to those applied by the Court in the Coles ‘Fresh Baked’ proceedings – for my commentary click here

*The ACCC has agreed to let Reckitt Benckiser continue to use the same packaging and product names after three months and for up to twelve months, provided it attaches a sticker to pack to the effect that - the products are equally effective at treating other types of pain; while it redesigns the products and has them approved by the Therapeutic Goods Administration.

Conclusions

In terms of legal compliance for its packaging and its website, Reckitt Benckiser followed the standard approach which is to use word for word the approved indications for the product (see above). Where it went wrong was not to recognize that the ACL imposes another level of compliance, which is that although the marketing material may be literally accurate, it may contravene the ACL if it creates an overall impression which misleads the consumer. This is particularly relevant when the product is displayed on the shelves in a grocery store or on a website, where a pharmacist is not available to assist the consumer.

As ACCC Chairman Mr Sims said “Truth in advertising and consumer issues in the health and medical sectors are priority areas for the ACCC, to ensure that consumers are given accurate information when making purchasing decisions.” See ACCC media release

The Nurofen Specific Pain Range is sold in the United Kingdom and in New Zealand, in the same way as it was sold in Australia. It will be interesting to watch whether the regulatory authorities in those countries take the same approach as the ACCC, and whether Nurofen will redesign its marketing material in those countries to be consistent with the redesign in Australia.