Last month the pharmaceutical company
Reckitt Benckiser was fined $6 million for misleading consumers with the packaging and advertising for its pain relief medication Nurofen.
The company had engaged in advertising and packaging its product in what was described as a “specific pain” range product line. The
packaging and promotion alleged that there were four different products specifically targeting pain relief for migraine pain, tension headache, period pain and back pain. Importantly, the product
line was priced at nearly double the price of the standard product. However, all of the products had the same active ingredient and, contrary to the representations, that active ingredient did not “target” any particular kind of pain.
In December 2015 the company was fined
$1.7 million after it was taken to the Federal Court by the Australian Competition and Consumer Commission (ACCC). However, the ACCC appealed that judgement and, on appeal,
the Federal Court increased the fine to
$6 million – the highest corporate penalty awarded for misleading conduct under the Australian Consumer Law.
ACCC Chairman Rob Sims said: “The ACCC welcomes this decision, having originally submitted that a penalty of $6 million or higher was appropriate given the longstanding and widespread nature of the conduct, and the substantial sales and profit that was made”.
“The ACCC will continue to advocate for higher penalties for breaches of Australia’s consumer laws to ensure that they act as an effective deterrent and are not simply viewed as a cost of doing business,” Mr Sims said.
The ACCC has been advocating for increased penalties under the current review of the Australian Consumer Law. This review formally commenced on 31 March 2016 and a final report is expected by March 2017.
John Clarke is the Solicitor Director of Clarke Law with a local network of offices in Narooma, Bermagui.