INSIGHT

Changes ongoing for product liability and compliance during COVID-19

By Miriam Stiel, Emma Gorrie, Ingrid Weinberg, Zoe Chapman, Sarah Muller
Consumer law COVID-19 Employment & Safety Health Intellectual Property

In brief 6 min read

The COVID-19 pandemic has brought about a rapid series of changes to product laws in the healthcare space as the Therapeutic Goods Administration (TGA) and the Australian Competition and Consumer Commission (ACCC) seek to regulate the manufacture and supply of essential hygiene products.

Australian businesses that manufacture personal protective equipment (PPE), detergents and hand sanitiser must remain on top of these changes in order to avoid potential liability.

Key takeaways

  • The regulations affecting healthcare-related products are changing frequently throughout the COVID-19 pandemic. It is critical for Australian manufacturers to keep up with these changes and monitor the effects of any further developments on their approach to the advertising, distribution and sale of such products.
  • In particular, manufacturers should ensure that any representations as to a product's purpose and/or effects (as well as its composition, in the case of hand sanitisers) are accurate given these representations determine whether or not the product is subject to TGA and / or the Australian Register of Therapeutic Goods (ARTG) requirements. Misleading representations may leave manufacturers open to penalties and potentially have broader implications for a brand's trust and reputation at a time of great uncertainty.

PPE

As Australia battles the pandemic, the use of PPE has become increasingly common. Face coverings (including masks and shields) are compulsory for people living in Victoria, and recommended for those living in New South Wales when they leave their homes and are not able to keep 1.5 metres away from other people. Many businesses have begun manufacturing non-sterile plastic and cloth masks to keep up with a spike in demand.

In April 2020, the TGA amended the Therapeutic Goods (Declared Goods) Order 2019 to provide that non-sterile PPE, including masks, gloves and gowns, are not 'therapeutic goods'. This applies to PPE that does not make therapeutic claims and that is not intended to be used to prevent disease transmission (such as that used for personal or domestic purposes). PPE intended to be used for surgical or examination purposes that claims to reduce or prevent transmission of bacteria or viruses remains a 'medical device' under the Therapeutic Goods Act 1989 (Cth) and must be included on the ARTG before they can be supplied.

The TGA is conducting a post-market review of face masks listed on the ARTG to determine if they meet the legislative requirements for medical devices and perform as intended. More than 280 registrations have been cancelled during the review. The majority were cancelled by suppliers rather than the TGA, so that they are not subject to recall.

The efficacy of PPE remains an issue globally. For example, Canadian and United States regulators recalled face masks that claimed compliance as 'KN95' respirators on the basis of the Chinese standard for respiratory protection because they failed to pass testing for 95% filtration, as required in those countries.

Hand sanitisers

In the early days of the pandemic, hand sanitisers disappeared from shelves as panic buying set in. Breweries and distilleries transformed supply lines to help meet demand. As a result, the TGA introduced regulations to allow certain hand sanitisers to be sold without the need for TGA approval:

  • Hand sanitisers containing ethanol and isopropyl alcohol must satisfy specific formulation and manufacturing criteria, based on standards recommended by the World Health Organisation, to be excluded from regulation as therapeutic goods.
  • Cosmetics or general consumer products: These are antibacterial products that only contain 'low-risk products' (ie no substances covered by Schedules 2, 3, 4 or 8 of the Poisons Standard) and that only make low-level claims about their effect on bacteria. Such products cannot claim to be active against viruses, fungi or other microbial organisms. Cosmetics or general consumer products remain subject to regulation by the Australian Industrial Chemicals Introduction Scheme and the ACCC.

Hand sanitisers falling within the above categories must also follow advertising requirements. This issue has already been the subject of a number of class action lawsuits in the United States, in which companies such as Purell are alleged to have misled consumers by claiming their hand sanitisers could prevent '99.9 percent of illness-causing germs'.

Here, hand sanitisers cannot claim to kill viruses and must not expressly or impliedly suggest they treat or prevent COVID-19. Those products that make specific claims about their effects on bacteria or viruses, or that are used in hospital or medical clinics, remain regulated as therapeutic goods and subject to inclusion in the ARTG.

In late July the TGA issued three infringement notices totalling $37,800 to a Melbourne-based company after it allegedly claimed its hand sanitiser killed COVID-19 and had been approved by the TGA where this was not the case.

The ACCC has issued guidance around hand sanitisers and warned of the danger of children confusing their packaging with food. It has recommended that suppliers consider the consistency of, and the ingredients used in, their products to reduce the impact and likelihood of accidental ingestion. The ACCC has also issued a set of detailed requirements around the packaging and labelling of hand sanitisers, including the need for safer dispensing mechanisms.

Disinfectants

With parts of Australia reopening, governments have encouraged strict regimes of cleaning and disinfecting premises necessary to prevent transmission of the virus.

Manufacturers of disinfectants must get approval from the TGA to claim that their products are effective against any virus. The TGA has given permission for specified disinfectants to represent that they are effective against the COVID-19 virus, either on their label, packaging or accompanying material. You can find an up-to-date list of disinfectants that have been granted permission to make such representations here.

The TGA recently announced it had fined one manufacturer almost $40,000 over advertising claims it had made in relation to its disinfectant product's effectiveness against COVID-19.

COVID-19 test kits

Early on in the COVID-19 pandemic, Australia faced a shortage of testing kits, and so restricted the testing criteria. The TGA has since expedited the assessment of tests for approval for listing in the ARTG.

A list is available of COVID-19 test kits that have received approval. The TGA has issued a strict warning that test kits cannot be supplied or advertised to consumers. Rather, the test kits can only be supplied to accredited pathology laboratories, medical practitioners, healthcare professionals in residential and aged care facilities, and other specified government agencies. In an announcement in early July, the TGA confirmed it will undertake a post-market review of approved COVID-19 test kits to verify their ability to detect antibodies.

The TGA initially provided an emergency exemption for supplies to pathology laboratories. This exemption ended on 31 July 2020, after which COVID-19 tests must be included in the ARTG. A broad exemption is no longer necessary now that there are sufficient numbers of testing kits available in Australia. A more limited emergency exemption will continue to apply through to June 2021 to accredited pathology laboratories, allowing them to test blood, tissue and organ donors for COVID-19 antibodies.