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Essen%al Elements for Effec%ve
Regula%on of Therapeu%c Goods and
Services Claims

Bill	Dee,	FEMAG	
Seminar	on	Adver5sing	of...
Cu=ng to the chase….this seminar is
about..
Ø Consumers’	health	
Ø False	&	Misleading	claims/rip-offs	
Ø Need	to	send	a	str...
The compliance pyramid
Drivers for compliance management system
- Why comply?

Ø Due	Diligence	Defence	
	
Ø Reduc5on	or	elimina5on	of	nega5ve	exp...
BoGom of the pyramid-enterprise
compliance management system
•  Structural	ma*ers	
Ø Top	management	commitment	
Ø Someone	...
BoGom of the pyramid-enterprise
compliance management system
•  Opera/onal	
Ø Opera5ng	procedures	(	see	A_achment	B	of	FEM...
BoGom of the pyramid-enterprise
compliance management system
•  Maintenance		
Ø Monitoring	systems	
	
Ø Repor5ng	systems	
...
Next level up-codes of conduct
•  Structural	ma*ers	
Ø Governing	body	commitment	
Ø Coverage	
Ø Consulta5on	
Ø Addressing	...
Next level up-codes of conduct
•  Opera/onal	
Ø Code	administra5on	
Ø Transparency	
Ø Consumer	awareness	
Ø Industry	aware...
Next level up-codes of conduct
•  Maintenance	
Ø Monitoring	
	
Ø Accountability	
	
Ø Review
The third level %er of the pyramid-civil
remedies

•  Essen)al	requirements	for	compliance	
Ø Stopping	the	conduct		
Ø Acc...
Stopping the conduct in a %mely
manner - Nurofen case 
•  Started	in	2010	when	the	promo5on	of	the	Nurofen	range	of	produc...
Stopping the conduct in a %mely
manner - the solu%on
•  The	ACCC	could:	
Ø First-seek	an	injunc5on	and	a	correc5ve	adver5s...
The third level %er of the pyramid-civil
remedies toolbox
Ø Civil	pecuniary	penal5es	
Ø Substan5a5on	no5ces	
Ø An	injunc5o...
The third level %er of the pyramid-civil
remedies
•  The	role	of	the	bo_om	of	the	pyramid	to	work	in	this	
space	was	summe...
Top of the pyramid-criminal penal%es
and licence suspension or cancella%on 
•  Criminal	penal/es-where	breaches	are	delibe...
Cu=ng to the chase-%me for ac%on
1.  Using	a	Therapeu5c	Claims	Commi_ee	of	Experts:	
Ø Triage	role	
Ø Expert	evidence	prov...
4.  Holding	a	therapeu5c	goods	and	services	claims	
scan	day	(	ACCC	already	conducts	scam	watch	
days)	
5.  Support		amend...
References
•  Copy	of	the	paper	downloadable	from	
www.femag.org.au	
•  Copy	of	slides	on	www.medreach.com.au	
•  Any	ques...
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Essential Elements for Effective Regulation of Therapeutic Goods_2016

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This presentation comes from the Seminar on Advertising of Therapeutic Goods and Services (and its Regulation), held in Sydney on 17 March 2016.

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Essential Elements for Effective Regulation of Therapeutic Goods_2016

  1. 1. Essen%al Elements for Effec%ve Regula%on of Therapeu%c Goods and Services Claims Bill Dee, FEMAG Seminar on Adver5sing of Therapeu5c Goods and Services (and its Regula5on) Sydney, 17 March 2016
  2. 2. Cu=ng to the chase….this seminar is about.. Ø Consumers’ health Ø False & Misleading claims/rip-offs Ø Need to send a strong message to the market that enterprises need to have an effec5ve enterprise compliance system or take the consequence of vigorous and )mely enforcement Ø “It’s Time”-for a new compliance regime for Therapeu5c Goods claims Ø “Seizing the Zeitgeist” – regulators need to be “innova5ve and agile” and who can be “disrup5ve” to scammers and shonky health claimers Ø Self interest-Michael Porter indicated that countries with robust safety regula5on and enforcement have a compe55ve advantage because consumers have more confidence in products from these countries (e.g. milk powder)
  3. 3. The compliance pyramid
  4. 4. Drivers for compliance management system - Why comply? Ø Due Diligence Defence Ø Reduc5on or elimina5on of nega5ve exposure Ø Reputa5on protec5on Ø Losing money ( lawyers fees, class ac5on( e.g. Nurofen)) Ø Enhancing risk management systems
  5. 5. BoGom of the pyramid-enterprise compliance management system •  Structural ma*ers Ø Top management commitment Ø Someone responsible for driving compliance Ø Alloca5on of responsibility Ø Management supervision Ø A system of documenta5on of all compliance material Ø Regulatory risk assessment and controls Ø Compliance plan Ø A system of documenta5on of all compliance material.
  6. 6. BoGom of the pyramid-enterprise compliance management system •  Opera/onal Ø Opera5ng procedures ( see A_achment B of FEMAG paper) Ø Educa5on and training Ø Regular communica5ons designed to secure compliance Ø Access to expert advice
  7. 7. BoGom of the pyramid-enterprise compliance management system •  Maintenance Ø Monitoring systems Ø Repor5ng systems Ø Compliance failures iden5fied, their causes analysed and rec5fica5on ac5on taken
  8. 8. Next level up-codes of conduct •  Structural ma*ers Ø Governing body commitment Ø Coverage Ø Consulta5on Ø Addressing consumer concerns Ø Adequate resources Ø Risk assessment Ø Alloca5on of responsibility Ø Appointment of a Compliance Officer/Manager Ø Compliance calendar/Compliance plan Ø A system of documenta5on of all compliance material Ø Complaints handling
  9. 9. Next level up-codes of conduct •  Opera/onal Ø Code administra5on Ø Transparency Ø Consumer awareness Ø Industry awareness Ø In house compliance including opera5ng procedures Ø Educa5on and training Ø Regular communica5ons designed to secure compliance Ø  Sanc5ons and other powers for non-compliance Ø Independent review of complaints handling decisions Ø Data collec5on Ø Performance appraisal
  10. 10. Next level up-codes of conduct •  Maintenance Ø Monitoring Ø Accountability Ø Review
  11. 11. The third level %er of the pyramid-civil remedies •  Essen)al requirements for compliance Ø Stopping the conduct Ø Access to compensa/on Ø Demonstrated adequate levels of compliance Ø Punishment for persistent and/or deliberate wrongdoing Ø Innova/ve approach to regulatory ac/on Ø TGA, AHPRA working with the ACCC- the ACCC being a regulator with stronger powers and a more asser5ve culture concerning consumer protec5on Ø Both organisa/ons making therapeu/c goods claims an enforcement priority Ø Using the most effec/ve regulatory tool in each given circumstances ( e.g. stopping the conduct quickly and seeking fines and giving such ac5on publicity to send a clear message to the appropriate industry or profession)
  12. 12. Stopping the conduct in a %mely manner - Nurofen case •  Started in 2010 when the promo5on of the Nurofen range of products “targe5ng” migraine, back pain, tension headache and period pain was awarded a CHOICE shonky award •  In June, 2011 Professor Paul Rolan put in a complaint to the CRP which was upheld but Recki_ Benckiser (Australia) Pty Ltd declined to comply. •  Dr Ken Harvey put in another complaint in 2012 •  TGA “Regula5on 9 order” followed in 2014 •  Despite “assurances” given to the TGA the misleading promo5on con5nued and in March 2015 the ACCC commenced legal proceedings which finally led to a determina5on in December 2015 and new pack labels in 2016 a few weeks ago •  In short, 6 years to get a result! •  Similar 5me frames with other cases eventually taken up by the ACCC such as Homeopathy Plus
  13. 13. Stopping the conduct in a %mely manner - the solu%on •  The ACCC could: Ø First-seek an injunc5on and a correc5ve adver5sement immediately Ø Then seek penal5es to send signals to the market ( and make the bo_om of the pyramid work) •  Professions regulators could: Ø Seek to stop offending conduct quickly ( include having the power to refer to the ACCC where conduct is misleading and/or substan5a5on evidence required) Ø Establish fast track protocols with appropriate regulators in egregious cases and those requiring urgent ac5on
  14. 14. The third level %er of the pyramid-civil remedies toolbox Ø Civil pecuniary penal5es Ø Substan5a5on no5ces Ø An injunc5on to stop conduct (a court order) Ø Correc5ve adver5sing Ø Compensa5on orders Ø Enforceable undertakings Ø Disqualifica5on orders Ø Infringement no5ces (penalty no5ce) Ø Adverse publicity orders Ø Safety warning no5ces Ø Media releases Ø Product liability and recalls provisions.
  15. 15. The third level %er of the pyramid-civil remedies •  The role of the bo_om of the pyramid to work in this space was summed up succinctly by Jus5ce Edelman found in ACCC v Woolworths when he stated that...“The penal5es I have imposed are designed in broad terms to achieve specific and general deterrence by requiring vigilance concerning quality management procedures to ensure the accuracy of representa)ons and effec)ve procedures for the recall or withdrawal of products and the no)fica)on of the ACCC. This is par)cularly so where products can affect consumer safety (emphasis added) and the person deals in the sale of large volumes of consumer products”.
  16. 16. Top of the pyramid-criminal penal%es and licence suspension or cancella%on •  Criminal penal/es-where breaches are deliberate or systemic. The maximum criminal and civil penal5es (fines) for making false or misleading representa5ons are $1.1 million for businesses and $220,000 for individuals. •  Imposing condi/ons on, suspending or revoking a licence- These ac5ons can be applied where the regulatory system involves licensing and would again be available to the regulator to use where there has been a deliberate, systemic breach. Publicity about such ac5on by the regulator sends a clear message to other in the industry to make sure that they have robust compliance management systems in place.
  17. 17. Cu=ng to the chase-%me for ac%on 1.  Using a Therapeu5c Claims Commi_ee of Experts: Ø Triage role Ø Expert evidence provider Ø Reference point 2.  Therapeu5c good claims an enforcement priority for regulators (e.g. TGA, ACCC etc.) and closer liaison between regulators 3.  Intelligent use of tools by regulators Ø Stop the conduct quickly first Ø Correc5ve adver5sing Ø Get fines later-need a deterrent impact Ø Promote the use of enterprise compliance management systems Ø Semng up an on-line monitoring team to constantly monitor websites and remove offending sites
  18. 18. 4.  Holding a therapeu5c goods and services claims scan day ( ACCC already conducts scam watch days) 5.  Support amendment of ACL to include a general duty of safety- this will drive Ø the development of safety compliance management systems at the enterprise level ( see Jus5ce Endelman’s comments on slide 15) Ø Building safety into design of product 6.  Capacity Building-ACCC providing leadership by including regulatory bodies including self regulatory bodies in its inves5gators course 7.  Have a review seminar on this topic in 2017
  19. 19. References •  Copy of the paper downloadable from www.femag.org.au •  Copy of slides on www.medreach.com.au •  Any ques5ons-compliance@ozemail.com.au

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