Boots Healthcare Australia Pty Limited v Glaxosmithkline (Australia) Pty Limited

[2003] FCA 1591

FEDERAL COURT OF AUSTRALIA

Boots Healthcare Australia Pty Limited v Glaxosmithkline (Australia) Pty Limited [2003] FCA 1591

BOOTS HEALTHCARE AUSTRALIA PTY LIMITED v GLAXOSMITHKLINE (AUSTRALIA) PTY LIMITED

N 2506 OF 2003

WHITLAM J
22 DECEMBER 2003
SYDNEY

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	N 2506 OF 2003

BETWEEN:	BOOTS HEALTHCARE AUSTRALIA PTY LIMITED APPLICANT
AND:	GLAXOSMITHKLINE (AUSTRALIA) PTY LIMITED RESPONDENT
JUDGE:	WHITLAM J
DATE OF ORDER:	22 DECEMBER 2003
WHERE MADE:	SYDNEY

THE COURT ORDERS THAT:

1.The claim for interlocutory relief is refused. 

2.The applicant pay the respondent’s costs of the claim for interlocutory relief.

Note:    Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	N 2506 OF 2003

BETWEEN:	BOOTS HEALTHCARE AUSTRALIA PTY LIMITED APPLICANT
AND:	GLAXOSMITHKLINE (AUSTRALIA) PTY LIMITED RESPONDENT

JUDGE:	WHITLAM J
DATE:	22 DECEMBER 2003
PLACE:	SYDNEY

REASONS FOR JUDGMENT

1. This is an application for interlocutory injunctions in a proceeding that was commenced as an urgent matter on 19 December 2003. The applicant and the respondent are large drug companies. The applicant alleges that the respondent has contravened s 52 of the Trade Practices Act1974 in an advertising campaign that the respondent is presently conducting.  This campaign relates to a product that the respondent manufactures and markets called Panadol.  The applicant is the manufacturer, marketer and distributor of a product called Nurofen.  Both products relieve pain and are described as analgesics.

2. Although the matter has come on quickly this afternoon, it has been preceded by some short correspondence and the respondent has been able to prepare a substantial case in opposition to the claim for interlocutory relief.  The evidence read in support of the application includes an affidavit of the solicitor for the applicant, Odette Gourley.  She annexed a copy of a print advertisement for Panadol.  Also annexed to her affidavit are the words used in two television commercials for Panadol.  They comprise transcripts of the voice-overs and reproductions of the super-texts displayed in the two commercials.  The first television commercial can be described as the woman jogger advertisement and the second commercial as the mature surfer advertisement.  The two commercials have been played in Court in two recorded forms, in a less clear form which was evidently recorded from television, and a somewhat clearer form that has apparently not been recorded from television.  In addition to Ms Gourley’s affidavit, an affidavit by Susan Mary Williams, the general manager of the applicant, was read in the applicant’s case.

3. The respondent in opposition to the application reads an affidavit of Ian Adams, the medical and scientific affairs director of the respondent, and two affidavits of Kevin Darke, the business development director of the respondent. 

4. The parties do not dispute the following facts:

   ·Both the applicant’s product (Nurofen) and the respondent’s product (Panadol) have been available without prescription (also known as ‘over the counter’ or ‘OTC’) for some years in pharmacies.

   ·The respondent’s product (Panadol) has been available without prescription for some years in grocery outlets (supermarkets, convenience stores and the like) in small (25 or less) packs.

   ·From 1 January 2004 products containing non-steroidal anti-inflammatory medicines (‘NSAIDS’) (eg Nurofen) will also be available without prescription in grocery outlets in small packs.

   ·Approximately 22% of asthmatics are sensitive to products containing aspirin or NSAIDS (eg Nurofen).  Of those asthmatics who are sensitive to NSAIDS, approximately 8.7% (i.e.approximately 1.9% of all asthmatics) are cross-sensitive to Panadol.

   ·The applicant presently has around 12.5% market share of analgesics sold in pharmacy outlets.

   ·The respondent’s product, Panadol, presently has around 6% market share of analgesics sold in pharmacy outlets.

   ·The respondent’s product (Panadol) presently has around 45-50% market share of analgesics sold in grocery outlets.

   ·Certain medications have interactions with or are contra-indicated for Nurofen use.

   ·Certain medications have interactions with or are contra-indicated for Panadol use.

5. The immediate background to the present application emerges from those facts.  It centres on the altered regulatory regime governing NSAIDS products such as Nurofen. Changes to that regime, taking effect from 1 January 2004, will permit the sale of Nurofen in certain small size packages in grocery outlets, including supermarkets.  This is important for both parties.  It appears very clearly from Ms Williams’ affidavit that in her opinion this change presents the applicant with a significant opportunity to expand its market share through sales of Nurofen in outlets that were previously not available to this product.

6. The respondent, for its part, accepts that there will be a change in the competition which its product Panadol faces in the analgesics market as a result of the applicant’s ability to sell Nurofen after 1 January 2004 in supermarkets.  The respondent clearly proclaims, through Mr Darke, its determination to hold onto its sales in supermarkets by distinguishing Panadol from products such as Nurofen.  Mr Darke quite frankly makes the point that asthmatics are one section of potential customers to whom their advertising is aimed and to whom they wish to point out differences between the two products. 

7. The specific representations that the respondent is said to have made are set out in paragraph 7 of the statement of claim.  The print advertisement (which is a newspaper advertorial) and the woman jogger television commercial are said to represent to consumers that ‘for asthmatics, Panadol is more suitable than and/or superior to other analgesics, including Nurofen’.  The mature surfer commercial is said to make the representation that ‘for consumers taking other medications, Panadol is more suitable and/or superior to other analgesics, including Nurofen’.  The ways in which those representations are said to be misleading are set out in paragraph 9 of the statement of claim.  The applicant alleges that, contrary to those representations, most asthmatics are not sensitive to Nurofen, a proportion of those who are sensitive to Nurofen are also cross-sensitive to Panadol, only certain medications have interactions or are contra-indicated for Nurofen use, and some medications interact with or are contra-indicated for Panadol use.

8. It is convenient to deal first of all with the question of whether there is a serious question to be tried that the advertisements are misleading and deceptive in the proscribed sense.  The print advertisement, which was initially described by the applicant’s counsel as a less flagrant contravention than the television commercials, appeared in the Sunday newspapers on 14 December 2003.  Such advertising is described as an advertorial because it appears, if quickly looked at, to be part of the regular editorial content of the newspaper, unless one notices that it is set off with the word ‘advertisement’ and the logo or brand name of the advertised product.  The advertorial contains what is described as a break-out which is in a different colour and the name of the person giving what is described as a testimonial for the product.

9. In relation to this advertisement and the television commercials, senior counsel for the applicant submitted that, in considering the question whether they are misleading and deceptive, the Court should nor parse or analyse such advertisements with infinite care but should look at it the way in which it will strike, and be read or viewed by, the average reader.

10. The advertorial relevantly reads:

    ‘Certain types of medicines can also trigger symptoms in some susceptible asthmatics, symptoms like wheezing, coughing, a runny nose and chest tightness – all of which can bring on asthma.
               Approximately 20% of adults with asthma may find that analgesics containing aspirin, or other non-steroidal anti-inflammatory medicines (NSAIDs – pronounced N-SAYDS) such as ibuprofen and naproxen can trigger an asthma attack.  Interestingly, aspirin or NSAID sensitive asthma most commonly begins in the early thirties and appears more often in women.
               “When I used to take aspirin, or ibuprofen products like Nurofen for a headache, I often started wheezing and sniffing.  Together with my doctor I identified these medicines as a trigger for me.  I now avoid these types of pain relievers,” says Christie.
               “After many years as an asthmatic, I am most comfortable using Panadol as it doesn’t trigger an adverse reaction with my condition.”
               Paracetamol products like Panadol are more suitable pain relievers for aspirin sensitive asthmatics, as less than one in ten people who are aspirin or NSAID sensitive are likely to be sensitive to paracetamol as well, with these reactions tending to be less severe.’

    The break-out box reads as follows:

    ‘What is asthma and what triggers it ?
    People with asthma experience episodes of wheezing, chest tightness and shortness of breath due to narrowing of the airways within the lungs.  The prevalence of asthma in Australia is relatively high by international standards and over 2.2 million Australians have asthma.
               For some people asthma can be triggered by a range of factors, some are listed below.

    • House dust mites  • Pollens  • Tobacco Smoke  •  Mould  • Exercise
               •  Certain medicines  •  Pets  •  Some foods and food additives

    If you suffer from asthma, talk to your doctor or pharmacist about the best way to identify what might trigger your attacks.’

11. This advertisement is said to be misleading or deceptive because of the break-out box, in particular what is there said about ‘certain medicines’.  It is said that the casual or normal reader would not read the unexceptionably accurate statements that are made in the text of the advertorial set out above.  That seems to me to be barely arguable but it may be that a very loose reading would permit the casual reader to conclude that all asthmatics are likely to be adversely affected by the consumption of a product like Nurofen.

12. In both television commercials, there is a combination of voice-over and super-text. I said in the course of argument that it seemed to me that the voice-overs were probably more important than the super-texts. However, the super-texts are important because, as Mr Darke explains in his affidavit, the Therapeutic Goods Advertising Code requires such text to be included in the commercials. The question whether particular advertisements comply with the Code is a matter for the Australian Self-Medication Industry, a self-regulatory organisation to whom the power to approve such commercials has been delegated under the Therapeutic Goods Regulations 1990. Both commercials have been approved. I think that that is a very important matter to be borne in mind on the issue of the balance of convenience. The fact that certain words have to be included by way of super-text is also an important factor when considering whether there is a serious question to be tried.

13. So far as the woman jogger advertisement is concerned, the key words in the voice-over attributed to the young woman are ‘so when I heard certain pain relievers were more suitable for some asthmatics, I made sure I read the label.  Now I choose Panadol’. (Emphasis added.)  Again, I do not think it is a strong case but counsel for the respondent conceded (perhaps intending a pun) that there might be ‘some’ question to be tried.

14. However, when one comes to the mature male surfer advertisement, it seems to me to be even more of a stretch to suggest that it is are misleading or deceptive in the ways specified in the statement of claim.  The relevant words in that advertisement are:

    ‘But I’m always careful with the choices that I make.  So when I read the labels and found some pain relievers shouldn’t be used with certain medications, I made sure I spoke to my doctor.  Maybe you should too.  Panadol, it’s my choice.’ (Emphasis added.)

    It seems to me to be a very slight case indeed.

15. Turning to the balance of convenience, counsel for both sides not surprisingly take different points, but I think a telling submission made by counsel for the respondent is that there is simply no evidence of any specific plans by the applicant to distribute Nurofen in supermarkets and how any such distribution is likely to be affected by these advertisements.  The evidence only shows that the applicant perceives the change in its ability to distribute through supermarkets as an opportunity.  Both sides submitted that the change to the regulatory environment and the fact that both the products have been in the marketplace for a long time are factors supporting their respective cases.  Nurofen will now be available in supermarkets where advice is not obtainable from a so-called health professional.  (The permitted sale of NSAIDS products in supermarkets may reflect the regulatory authorities’ view about the realities of the way in which non-prescription medicines are sold in pharmacies, but I do not know.)  Both sides attach importance to labelling and marketing and their effect, educational or otherwise, on consumers.  I am bound to say that I do not think that this is a strong case in relation to any of the advertisements.  That is always relevant to the balance of convenience and in a case like this, where the public interest in the safe provision of therapeutic goods looms large, I am not persuaded that this is a suitable case to grant the relief sought by the applicant. 

16. Accordingly, the application is refused.  The applicant is to pay the respondent’s costs of the claim for interlocutory relief.

I certify that the preceding sixteen (16) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Whitlam.

Associate:

Dated:             8 January 2004

Counsel for the applicant:	I M Jackman SC with M J Darke
Solicitors for the applicant:	Minter Ellison
Counsel for the respondent:	J W J Stevenson SC with Richard Cobden
Solicitors for the respondent:	Freehills
Date of hearing:	22 December 2003
Date of judgment:	22 December 2003