Application by Medicines Australia Inc - [2007] ACompT 4

FEDERAL COURT OF AUSTRALIA
Application by Medicines Australia Inc [2007] ACompT 4
TRADE PRACTICES – applications for review of authorisation determinations under s 88 of the Trade Practices Act –proposed contract, arrangement, understanding or conduct involving exclusionary provisions – exclusive dealing arrangement – industry association – Code of Conduct – little anti-competitive detriment – sufficient public benefit to outweigh anti-competitive detriment and to allow authorisation of exclusionary provisions and third line forcing – public benefit limited by inefficiencies in enforcement of Code – nature of authorisation – nature of discretion to authorise where public benefit test satisfied – nature of power to impose conditions – where anti-competitive detriment low and public benefit case not strong – condition justified strengthening particular public benefit – Code of Conduct regulating promotion of pharmaceutical medicines by pharmaceutical companies to healthcare professionals – provisions relating to conferral of hospitality and other benefits on healthcare professionals – low level of complaint and enforcement of such provisions – whether conditions should be imposed to require Code to include public reporting of hospitality and sponsorship benefits – authorisation affirmed but varied as to terms of condition and period of authorisation
Trade Practices Act 1974 (Cth) s 88, s 90, s 91, s 101, s 102
Therapeutic Goods Act 1989 (Cth)
Therapeutic Goods Amendment Act (No 1)2003 (Cth)
National Health Act 1953 (Cth)
Jones v Australian Competition and Consumer Commission (2003) 200 ALR 234; 131 FCR 216 cited
Re Queensland Co-operative Milling Association Ltd; Re Defiance Holdings Ltd (1976) 8 ALR 481; 25 FLR 169
Re Howard Smith Industries Pty Ltd (1977) 28 FLR 385
Re Rural Traders Co-operative (WA) Ltd (1979) 37 FLR 244
Re 7-Eleven Stores Pty Ltd (1994) 16 ATPR 41-357
Re Southern Cross Beverages Pty Ltd (1981) 50 FLR 176
Qantas Airways Ltd [2004] ACompT 9
Re VFF Chicken Meat Growers Boycott Authorisation [2006] ACompT 2
Application by Michael Jools (2006) 233 ALR 115
Re QIW Ltd (1995) 132 ALR 225
Re Media Council of Australia Authorisation; Re Australian Consumers’ Association’s Application (1987) 88 FLR 1
Re Australian Competition and Consumer Commission by Australian Association of Pathology Practices Inc (2004) 206 ALR 271
Re EFTPOS Interchange Fees Agreement (2004) 26 ATPR 41-999
Water Conservation and Irrigation Commission (NSW) v Browning (1947) 74 CLR 492
Oshlack v Richmond River Council (1998) 193 CLR 72
Re Herald and Weekly Times Ltd (1978) 17 ALR 281
Re Queensland Timber Board (1975) 24 FLR 205
Lord Wilberforce, Campbell and Elles Restrictive Trade Practices and Monopolies (Sweet & Maxwell, London, 1966)
Donald BG and Heydon JD, Trade Practices Law (Law Book Co, 1978)
Barnes and Blakeney, Advertising Regulation (Law Book Co, 1982)
Gunningham N, “Codes of Practice: The Australian Experience” in Webb K (ed), Voluntary Codes: Private Governance, the Public Interest and Innovation (Carleton Research Unit for Innovation, 2004, Ch 12)
Webb K and Morrison A, “The Law and Voluntary Codes: Examining the “Tangled Web”” in Webb K (ed), Voluntary Codes: Private Governance, the Public…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2007] ACompT 4
Decision Date: 27 JUNE 2007

CaseChat Overview and Summary

Medicines Australia Inc, an industry association representing pharmaceutical companies, applied to the Australian Competition Tribunal for review of a determination by the Australian Competition and Consumer Commission (ACCC) to grant authorisation for Edition 15 of the Medicines Australia Code of Conduct (Code). The Code sets out standards of conduct for the activities of companies engaged in the marketing of prescription products used under medical supervision. The ACCC granted authorisation for the Code subject to a condition requiring each member to report twice yearly to Medicines Australia on events sponsored by the member for healthcare professionals and Medicines Australia to make such reports publicly available on its website and to review them through its Monitoring Committee. The Tribunal affirmed the ACCC's determination of authorisation but varied the condition imposed upon it to require each member to report to Medicines Australia on all educational meetings and symposia as defined in ss 6, 7 and 10 of the Code held or sponsored by that member and for Medicines Australia to make such reports publicly available on its website. The Tribunal also varied the period of authorisation to five years. The Tribunal considered that the public benefit likely to flow from the implementation of the proposed Code outweighs any anti-competitive detriment flowing from it and that the necessary conditions for authorisation are thus satisfied. The Tribunal was of the view that the authorisations should be granted but upon a condition, in each case, that the Code be amended to require reporting by the members of Medicines Australia and public disclosure of hospitality benefits conferred by members on healthcare professionals. The purpose of the condition was to increase the likelihood that the public benefit claimed for the Code is realised in respect of the provisions dealing with the conferral of such benefits on doctors. The Tribunal also considered that authorisation should be for a period of five years.

Orders