Advertising prices of prescription products to be made clearer

By Julieann Ahern.

Key Points:
Under the Draft Code, advertising the prices of prescription medicines and certain pharmacy only medicines will be made simpler.

The Therapeutic Goods Administration ("TGA") recently released a Regulatory Impact Statement in relation to a draft Price Information Code of Practice ("Draft Code") and a review of the consultation process leading up to the publication of the Draft Code.

Under the Draft Code, advertising the prices of prescription medicines and certain pharmacy only medicines will be made simpler.

The Galbally Review of 1999-2000 determined that advertising of the pricing of prescription-only and certain pharmacist-only medicines should be permitted, provided that such advertising did not promote the use or supply of those products and was only for the information of consumers.

The Galbally Review recommended that the National Co-ordinating Committee on Therapeutic Goods ("NCCTG") develop a standard for the provision of "Informational Price Advertising" of such medicines.

The recently released Draft Code has been developed by NCCTG in response to that recommendation.

Currently

Publication of price information about prescription-only and pharmacy only medicines (except for those in Appendix H of Schedule 3 to Standard for the Uniform Scheduling of Drugs ("SUSDP") which indirectly promotes the use or supply of those products amounts to a breach of the current regulatory regime.

Whilst consumers may receive information about the price of prescription-only and certain pharmacy-only medicines from health professionals such as doctors and pharmacists, if publication of the price promotes the use or supply of the medicine, it is prohibited.

The difficulty in this area to date has been the lack of guidance as to how price information can be provided in a way which does not promote the use or supply of the relevant therapeutic good.

The Galbally Review acknowledged that the issue is a difficult one, given the fine line between that which is promotional and that which is information.

The Draft Code

The aim of the Draft Code is to permit the publication of price information as between suppliers of medicines listed in Schedules 3, 4 and 8 of the SUSDP. Unscheduled medicines, Schedule 2 medicines, and medicines in Appendix H of Schedule 3 will not be covered by the Code, save for some minor exceptions.

The Draft Code does not permit the publication of price information which is promotional and provides guidance as to how price information can be conveyed whilst ensuring it is not promotional. Publication of any information that is promotional or inconsistent with the Code will be prohibited.

The Draft Code provides that:

• price information will only be able to be provided by suppliers;
• product manufacturers, distributors or sponsors will not be able to provide price information;
• price information will be able to be provided by any method except TV, radio and "outdoor advertising", eg. on billboards and buses;
• provision will be made for the exclusion of controlled substances prone to misuse/abuse; and
• price information will be defined as information about the costs to consumers "at the pharmacy till", that is, after subsidies and any applicable premiums and concessions have been applied.

Consistency with the trans-Tasman scheme

The Code is to be further amended to make it trans-Tasman consistent, and following that amendment, is likely to be finally endorsed by the NCCTG. Once endorsed and appropriate Regulations have been made, the Code will only apply in Australia, as New Zealand will retain its current regulatory regime for direct consumer advertising of therapeutic products.

Future Review

The Draft Code will be reviewed after it has been in operation for 12 months.