Food/therapeutic goods interface: Can apples be compared to orange pills?

By Lisa Kurian and Madeleine Kearney.

Key Points:
Where a product is borderline in terms of its composition, the marketing and presentation of the product may be enough to transform the product into a therapeutic good rather than a food. Manufacturers and importers marketing these products as foods must be careful not to accidentally present the product in such a way that the product is represented to be for therapeutic use or is likely to be taken for therapeutic use.

"Foods" and "therapeutic goods" are subject to two very different regulatory regimes in Australia. Whether a product is classified as a food or a therapeutic good is clearly a question of importance for manufacturers and importers of goods, as the classification will fundamentally alter both the manner in which a product can be marketed, andthe company's compliance regime. As food legislation usually imposes a smaller regulatory burden on manufacturers and importers than therapeutic goods legislation, in circumstances where it is possible to market a product as a food, it is often an attractive proposition to do so.

The question of whether a particular product is appropriately classified as a "food" or a "therapeutic good" should be easy to answer - an apple is a "food", a pill is a "therapeutic good". However there has always been some crossover between the categories of products - after all, foods and therapeutic goods are both consumed and both are intended to have a physiological effect. This is reflected in the legal definitions of "foods" and "therapeutic goods". Indeed, an understanding of the definition of one is needed for an understanding of the other.

In recent years, the line between the two categories has become increasingly blurred, both due to technological advances and to product innovations. There are now a wide range of products on the Australian and New Zealand market that may be classified as either a therapeutic good or a food product, depending upon the composition of the product, and how the products are marketed. Where a product is "borderline" in terms of its composition, the marketing and presentation of the product may be enough to transform the product from a food into a "therapeutic good". These products include products that resemble food in form, i.e foods fortified with medicinal herbs, or food extracts (in circumstances where the extract does not have a history of use as a food, or is produced using new technology).

This article examines the issue of "borderline" products. In particular, we look at the risks associated with comparative advertising between a product marketed as a food and a therapeutic good.

The importance of classification

It is trite but important that manufacturers appropriately classify their products as either therapeutic goods or food products. For example, a product classified as a "food" needs to be labelled in accordance with the Food Standards Code, meaning (amongst other things) information regarding the nutritional profile of the food, and certain allergens in the food, needs to be provided to the consumer on the label of the food. On the other hand, a product classified as a "therapeutic good" must be listed or registered in the Australian Register of Therapeutic Goods, and any advertisements of the therapeutic good must comply with the Therapeutic Goods Act 1989, Therapeutic Goods Regulations 1990 and the Therapeutic Goods Advertising Code 2005.

What is a food?

A food is defined in various Commonwealth, State and Territory Acts relating to food as including "any substance used for human consumption" but excluding therapeutic goods within the meaning of the Therapeutic Goods Act 1989. That is, the legal definition of a food is anything that is eaten or drunk, unless that product is a therapeutic good. As such, to properly understand what a food is, one must know what a therapeutic good is.

What is a therapeutic good?

Therapeutic goods are defined in the Therapeutic Goods Act 1989 as goods: "that are represented in any way to be, or that are, whether because of the way in which the goods are presented or for any other reason, likely to be taken to be...for therapeutic use".

However, the following types of products are specifically excluded from the definition of "therapeutic goods":

• goods for which there is a prescribed standard in the Food Standards Code;
• goods which, in Australia or New Zealand, have a tradition of use as foods in the form in which they are presented.

In other words, a product which is eaten or drunk is a food, unless it is a therapeutic good. A product is a therapeutic good if it is represented to be (or if for any other reason is likely to be taken) for therapeutic use. However, a product is not a therapeutic good if there is a prescribed standard in respect of the product in the Food Standards Code, or if the product has a tradition of use as a food. So a product is a food, unless it’s a therapeutic good, unless it’s a food!

To make matters more complicated, there is provision in both food and therapeutic goods legislation to declare products as foods or therapeutic goods, respectively.

What types of products are borderline?

Borderline products are those which have a health benefit to the consumer and are (for whatever reason) capable of being considered a food, but for which there exists no standard in the Food Standards Code, and do not otherwise have a tradition of use as a food in the form in which the product is presented. There are also prescribed standards in respect of a very limited range of foods.

Examples of these types of products might include:

• products that resemble foods in their form, for example, foods fortified with medicinal herbs;
• "functional foods" - foods developed to provide a specific health benefit to consumers. An example of such a product is plant sterols, which are added to products such as margarine and help reduce cholesterol absorption;
• food extracts, possibly derived using new technology - eg, an anti-oxidant extract from tea; and
• products that are currently available, but are derived from new sources, eg, omega 3 oils derived from algae.

For these types of products the factor that will determine whether they are a food or a therapeutic good is whether the products are represented in any way to be or likely to be taken to be for therapeutic use. In other words, the marketing of the products will affect their classification. It is the making of a therapeutic claim in respect of these products which will mean that these products are appropriately classified as therapeutic goods.[1]

Food/Medicines Interface Group

The difficulties associated with the way the definitions of "food" and "therapeutic good" interact has been recognised by the Federal government, which established the Foods / Medicines Interface Group to provide advice to industry. The Interface Group comprises members from Food Standards Australia New Zealand, the body responsible for setting food standards, the Therapeutic Goods Administration and the Australian Quarantine Inspection Service.

The group meets on an as-needed basis to discuss case-by-case specific products forwarded to it in order to make suggestions as to whether a product is more appropriately treated as a food or a medicine. The advice provided by the group often consists of suggestions about labelling or compositional changes that may be needed to clarify the regulatory status of the particular product. However, the group has no legislative status, and has no power to make "decisions". It is ultimately up to the manufacturer/importer of the product to ensure that it has classified the product appropriately and that it complies with all relevant legislation. .

Risks associated with comparing foods with therapeutic goods

When a manufacturer/importer decides to market a borderline product as a food product, it is critical that the manufacturer ensure that any advertising of the product does not include therapeutic claims. To do so would risk that product losing its status as a food. In effect, the claim would instantaneously transform the product from a food into a therapeutic good. Such a transformation would almost certainly place the the manufacturer/importer in breach of therapeutic goods legislation. It is highly unlikely that the packaging or labelling of that product would be in compliance with either therapeutic goods legislation or the Food Standards Code.

Although there is no express prohibition in the Food Standards Code (or related food legislation) or the Therapeutic Goods Act 1989 against comparing a food to a therapeutic good, it is certainly conceivable that, in certain situations, such a comparison would, by its nature, constitute a therapeutic claim. The food would then become a therapeutic product with associated unwanted consequences.

This is a particular risk if an advertisement for a food product targets existing users of a particular therapeutic good. For example, if a manufacturer develops a soft drink fortified with a medicinal herb, such as gingko biloba, and makes the following statement in advertising:

"Throw away your supplements! Finally, a delicious way to take your gingko, without all those nasty pills!",

what was simply a drink may well have become a therapeutic good.

Although no express therapeutic claims are made in the above statement, the message advocates that consumers switch from a vitamin supplement, which is classified as a therapeutic good under Australian law, to the drink. Consumers who take this supplement would be aware of the claims made on the packaging of the vitamin supplement and are presumably taking the supplement for a therapeutic benefit. If they "switched" from the supplement to the drink, they would be taking the drink with the expectation that it will deliver a therapeutic benefit. As such, the statement has the effect that the product is being presented in such a way that it is "likely to be taken for therapeutic use".

In addition, manufacturers must ensure that any advertisements comparing a food product to a therapeutic good are not misleading and/or deceptive to consumers, in contravention of the Trade Practices Act 1974. For example, the above comparison may be misleading if the drink contains an insufficient quantity of the gingko to have any therapeutic effect at all.

Trans-Tasman developments/Review of the "health claims" standard

The trans-Tasman therapeutic products agency, which will replace Australia's Therapeutic Goods Administration and New Zealand's Medicines and Medical Devices Safety Authority, is due to commence on 1 July 2006. Following commencement, a new trans-Tasman therapeutic products advertising scheme will come into force in relation to the advertising of therapeutic goods to be supplied in Australia and New Zealand. The draft Australia New Zealand Therapeutic Products Advertising Code (Version 11) has been developed to underpin the proposed trans-Tasman therapeutic products advertising scheme. Section A 3.2 sets out when the Code applies to specific types of advertisements and states:

"Where advertisements for a food product contains a claim for therapeutic use, other than a nutrition or health related claim as specifically prescribed by any standard nutrition, health and related claims in the Food Standards Code, the product may be declared to be a therapeutic product subject to the full provisions of the therapeutic product legislation, including compliance with the Code and all other regulatory requirements."

Additionally, the Food Standards Code currently contains a prohibition on "health claims" (which include therapeutic claims"). The "health claims" standard is currently being reviewed, with a view to relaxing the prohibition. On 28 November 2005, Food Standards Australia New Zealand released its Draft Assessment Report on health claims, representing the second round of public consultation. The Draft Assessment Report indicates that during the first round of public consultation, some submitters expressed their concern in relation to the perceived "blurring" of the distinction between foods and therapeutic goods if health claims were to be permitted in respect of foods. The Draft Assessment Report States that "as part of the establishment of the Joint Agency for the regulating therapeutic products an ad hoc Trans-Tasman working group on the Food/Medicines Interface has been formed. The purpose of this group is to develop a tool for determining the regulatory status of products at the food/medicine interface" with the purpose of ensuring a clear demarcation between foods and therapeutic goods.

The draft standard on health claims forming part of the assessment report also contains a prohibition on comparing food products to therapeutic goods. Whilst this draft standard is far from being law yet (it still needs to go through at least one more round of public consultation before being submitted to the Health Minsters for consideration), it demonstrates that this is a topical issue for the regulators, and that reform in this area may be imminent.

Conclusion

Manufacturers and importers of "borderline" products that have decided to market these products as "foods" need to take great care in advertising to ensure that they do not (inadvertently or otherwise) make any representations or otherwise present the product in such a way that the product is represented to be for therapeutic use or is likely to be taken for therapeutic use. Like the philosopher's stone, a simple comparison may be sufficient to transform a product from a food to a therapeutic good.

Manufacturers and importers would be prudent in seeking advice on the classification and advertising issues identified in this article to ensure continuing compliance with Australian law. Manufacturers and importers may also need to seek further advice on food/therapeutic goods interface issues following commencement of the trans-Tasman therapeutic products agency and the completion of the review of the health claims standard. Watch this space!

For further information, please contact Jocelyn Kellam.