New rules from the TGA restrict influencers from promoting certain skin, health and beauty products.
The Therapeutic Goods Administration (TGA) has introduced changes to its Advertising Code which ban paid testimonials for therapeutic goods in all advertising formats.
The ban prevents social media influencers from promoting certain cosmetic and health products if they are paid or incentivised (by receiving gifted goods) for providing testimonials.
Prominent influencer Emma Mugica (who has over 73,000 Instagram followers) told The Australian newspaper the changes would ‘cripple her earnings’ as the majority of her income ‘is supported by paid partnerships with skincare, wellness, vitamin and protein brands’.
She said: ‘Influencer marketing is the number one strategy for most companies. By pulling that away from them, not only are influencers losing out on their job, but the companies are also losing out on a lot of business.’
Leading law firm King & Wood Mallesons has formally assessed the changes and noted that, regardless of whether a testimonial is genuine, anyone who receives ‘valuable consideration’ is considered ‘involved with the production, sale, supply or marketing of the goods’, which prohibits them from making a testimonial.
‘Valuable consideration’ would include non-monetary items such as services, gifts, opportunities or any other incentive.
The updated Code – which applies to all therapeutic goods (including medicines, medical devices, vitamins and some cosmetics) – is voluntary until 1 July 2022, when it becomes mandatory. As a result, any non-compliant posts which are currently live on the internet will need to be taken down by 1 July.
However, the Australian Influencer Marketing Council (AIMCO) moved to address confusion around the new Code by asserting it ‘does not ban promotion’ of therapeutic goods, but simply aligns the rules for influencers with the longstanding rules for other advertising formats of therapeutic goods.
AIMCO told mumbrella.com.au influencers will still be able to ‘endorse and promote’ therapeutic goods in exchange for payment or gifts ‘so long as the endorsement abides by the rules stipulated in the TGA Advertising Code’.
Endorsement Versus Testimonial
AIMCO declared the key issue will be interpretation of an ‘endorsement’ versus a ‘testimonial’, which are defined on the TGA website.
An endorsement ‘is made where a person or corporation sanctions (approves of) a particular therapeutic good but there is no indication as to the outcome(s) from the use of the good by any individual. For example, ‘Company X recommends Brand Y disinfectant’.’
A testimonial ‘is made where an individual person has used a therapeutic good and has testified as to the outcome(s) they experienced from the use of the good. For example, ‘I use Brand Z cream on my eczema as it helps soothe the itch and inflammation’ or ‘Brand A liquid helped ease my daughter’s discomfort during teething’.’
Caroline Hogh Groth, a wellness influencer who works with skincare and supplement brands, told mumbrella.com.au that news about the changes was confusing.
‘There’s been a lot of misinformation spread across digital news platforms and social media and that’s made it hard to understand what’s actually changing and how it’s impacting the industry – both for brands and for content creators/influencers’, she said.
‘I do think it will affect my work to some extent; however, it’s also part of my job to adjust to ongoing changes, both in the industry and on social media, as we move towards creating more transparency for the consumer.’
Hogh Groth conceded the TGA’s rules about testimonials would ‘impact her ability to connect openly with her audience when promoting goods that fall under the Code’ and summed up: ‘I do think it’s a shame that we can’t include personal testimonials any longer.
‘I can only speak for myself, but I’ve always approached what I do and my community/following with the utmost respect. This means my authenticity and honesty mean more to me than any amount of money ever will, because once you lose trust from your following, you don’t get it back.
‘Any brand I’ve ever worked with will always be one I’ve tested and tried and given honest feedback to my community.
‘So for me not to be able to include a genuine personal testimonial – even if it’s a paid partnership – is a real shame.’ AMP
Therapeutic Goods Advertising Code
From 1 January 2022 Australia’s Therapeutic Goods Administration (TGA) introduced changes and updates to the Therapeutic Goods Advertising Code – the cornerstone of its therapeutic goods advertising framework, which ‘sets out minimum requirements for advertising therapeutic goods to the public – to ensure ‘the language and presentation meets contemporary government standards’.
The TGA noted ‘further changes will be made to advertising education and guidance material over coming months’ – and warned ‘there are criminal offences and civil penalties for advertising to the public in a manner that does not comply with the Code’.
Confirming the changes, the TGA emphasised:
- ‘advertising of therapeutic goods requires a higher ethical standard than may apply
for advertising of ordinary consumer goods because consumers rely on therapeutic goods for their health’; and - ‘it can be difficult for a consumer to determine the appropriateness of a therapeutic good for their particular circumstances, so it is important that promotional material is truthful, balanced and not misleading’.
The TGA noted its Code exists to ‘ensure advertising of therapeutic goods to the public is conducted in a manner’ that:
- promotes the safe and effective use of therapeutic goods by minimising misuse, overuse or underuse;
- is ethical, does not mislead or deceive the consumer or create unrealistic expectations about product performance;
- supports informed health care choices;
- is not inconsistent with relevant current public health campaigns.
The TGA has provided detailed ‘guidance on applying the Advertising Code’ (www.tga.gov.au/guidance-applying-advertising-code-rules) which includes practical examples relating to mandatory statements, health warnings, testimonials and endorsements, substantiation of claims, product and service comparisons, safe and proper use, scientific or clinical representations, advertising lawfully to children and price information.
It also provides specific direction on ‘activities that represent advertising’ – including ‘promotional activities and materials’ and ‘forms an advertisement may take’.
For the purposes of the Code, therapeutic goods have been divided into three broad categories: medicines; medical devices; other therapeutic goods (OTGs).
For users familiar with the previous 2018 Advertising Code, a table of changes (www.tga.gov.au/therapeutic-goods-advertising-code-comparing-2018-and-2021-codes) has been created to highlight the equivalent reference in the new Code.
