Case: Astrazeneca Pty Ltd v GlaxoSmithKline Australia Pty Ltd [2006] FCAFC 22 ; [2006] ATPR 42-106
Outcome: considered
In Taco Co of Australia Inc v Taco Bell Pty Ltd (1982) 42 ALR 177 at 202 Deane and Fitzgerald JJ outlined a series of propositions to be considered in assessing whether conduct is misleading or deceptive under s 52 of the Act: &#8226; It is necessary to identify the relevant section(s) of the public by reference to whom the question of whether conduct is or is likely to be misleading or deceptive falls to be tested (ie to whom the conduct is directed, as subsequently addressed in Astrazeneca Pty Ltd v GlaxoSmithKline Australia Pty Ltd [2006] FCAFC 22 ; [2006] ATPR 42-106 at [34] ). &#8226; Once the relevant section of the public is established, the matter is to be considered by reference to all who come within it, including the astute or the gullible, the intelligent or not so intelligent, educated or not educated and men and women of various ages and vocations (citing Puxu Pty Ltd v Parkdale Custom Built Furniture Pty Ltd (1980) 31 ALR 73 at 93 per Lockhart J). &#8226; Evidence that some individual has in fact formed an erroneous conclusion is admissible and may be persuasive, but is not essential. Regardless, such evidence does not itself conclusively establish the conduct to be misleading or deceptive, the test is objective and one the court must determine for itself. &#8226; It is necessary to inquire why any proven misconception has arisen (citing Hornsby Building Information Centre v Sydney Building Information Centre (1977) 140 CLR 216 at 228). It is only by this investigation that the evidence of those who are shown to have been led into error can be evaluated and it can be determined whether they are confused because of misleading or deceptive conduct on the part of the respondent. When I discuss doctors, pharmacists and patients, it is in the context of these principles. 58 No reason has been advanced to sub-divide these groups into any sub-classes or areas of specialisation. The question is whether the advertisements would be likely to lead to a misconception arising in the minds of that section of the public to whom the conduct, or silence, has been directed. Where, as here, the representations are made to various classes of the public, the characteristics of the members of that class are relevant in order to determine whether a misconception is likely to arise from the conduct alleged ( Campomar at [98] [103]; Astrazeneca at [34]). The question is whether a not insignificant number of doctors, pharmacists or patients will be misled ( ConAgra Inc v McCain Foods (Australia) Pty Ltd [1992] FCA 159 ; (1992) 33 FCR 302 at 380-381 per French J; National Exchange Pty Ltd v ASIC (2004) ATPR 42-000 at [70]). It is therefore necessary to assess the reactions or likely reactions of the members of each class to whom the conduct was addressed ( Campomar at [105]). The representations are to be tested by their effect on ordinary and reasonable persons within those groups ( Campomar at [102]). 79 It is not necessary for GenRx to establish that Ms Crisp, or anyone else, was actually misled or that she took steps consequent upon her misunderstanding ( Astrazeneca at [33]). However, it is relevant that Ms Crisp laboured under an erroneous assumption as to the substitutability of new Coversyl, arising from the use of the stamp issued by Servier and used by the prescribing doctor ( Astrazeneca at [36]; Taco Bell at 202). I am not satisfied that Ms Crisp's assumption was extreme or fanciful. To the contrary it was, for a busy pharmacist who dispenses numerous different drugs daily, a reasonable reaction on the part of an ordinary and reasonable pharmacist. The stamp did not simply cause confusion or wonderment ( Campomar at [106]), it misled Ms Crisp. It caused her to take remedial action, without which she would have continued to believe that brand substitution for Coversyl was not generally permitted. Accordingly, Ms Crisp laboured under an error ( Taco Bell ). 83 Mere confusion on the part of patients is not sufficient to establish a contravention of s 52 of the Act. Where there is no evidence of actual misleading, the question raised by the pleading is whether patients were or were likely to have been misled by the use of the stamp on patient prescriptions ( Campomar at [106]; Astrazeneca at [38]). 95 Doctors who read medical journals would be familiar with advertising for different drugs. The first banner advertisement would be recognised by doctors as an advertisement for Coversyl. Although it is in small type, there is an "elucidator" ( Astrazeneca ) that Servier has placed the advertisement. The statement "BRAND SUBSTITUTION NOT PERMITTED" appears directly next to the red box containing a tick and the exhortation "tick the box". The hypothetical ordinary or reasonable medical practitioner is familiar with the tickable box adjacent to the words "BRAND SUBSTITUTION NOT PERMITTED" appearing on standard prescription forms and its purpose. A doctor appreciates that he or she has the option to tick that box when writing a prescription for a specific brand of drug and that, if ticked, the pharmacist is not entitled as a matter of law to substitute another brand of drug for that which appears on the prescription form. A doctor reading the advertisement as a whole would know that Coversyl is a branded product which, without the exercise of the doctor's discretion to tick the box, can be substituted by "a"-flagged generics. 96 The first banner advertisement is an exhortation to tick the box and would be read as such. The doctor would associate the advertisement with the box on the standard form of prescription which he or she can decide to tick. He or she would understand that the advertisement was urging the doctor to tick that box as part of the completion of the prescription for Coversyl. I do not accept that it would be read or understood by a doctor to represent that brand substitution for Coversyl is never permitted or permissible. It does not say that the doctor cannot instruct that there be no substitution, or that the doctor is not permitted to allow substitution, or that "a"-flagging has not been or is not permitted. There is no suggestion of a Government or TGA source. The fact that the box is pre-ticked is not sufficient to suggest that a regulatory body has made a decision not to permit substitution. 97 There would be no need for an advertisement or for the doctor to tick the box if there was no "a"-flagged generic, or substitutable generic, drug for Coversyl. The advertisement does not represent that there are no substitutable drugs or that brand substitution is not permitted, in the sense that the doctor could not permit such substitution. Doctors would not be misled into thinking there is some regulatory bar to brand substitution for Coversyl. 110 In Astrazeneca the Full Court considered whether advertising flyers that were sent to general practitioners regarding a particular asthma medication were misleading or deceptive under s 52 of the Act. The flyers contained references to a clinical study and its results. The Court noted that in order to determine whether any breach of s 52 had occurred, it was necessary to determine whether the conduct would be likely to lead to a misconception arising in the mind of that section of the community to whom the conduct was directed (at [34]; [37]). The Court noted that the representations in the advertisement were not made to identified individuals or to the public at large (at [35]) but to ' ordinary or reasonable members of the community of general practitioners throughout Australia ...'. The representations as claimed were not misleading or deceptive when viewed, in their entirety, as marketing documents directed to that class (at [24]; [42]). It can be assumed that the class of medical practitioners would, as in Astrazeneca , have some knowledge of clinical trials and that the class would accordingly view such material in a different fashion to the public at large. 111 I do not accept that the references to non-clinical factors would be understood by doctors as referring to regulatory matters. Doctors, by reason of education and experience, would understand that drugs are publicly available as a result of expenditure on research by innovator or originator companies. These are factors of importance to some medical practitioners (see [63]). GenRx submits that, although it is apparent that some of the reasons are not clinically based, doctors would be misled into thinking the reasons are ' reasonable or proper reasons to take into consideration when prescribing Coversyl '. They may be so led but it would not be misleading. Doctors are entitled, in their discretion, to take into account matters that are clinically related, although not specifically concerning the medication for that patient. For some ordinary and reasonable doctors, such as Drs Barlow, Ferrari, Flecker and Lambie, investment by originator companies in Australia and the undertaking of research, funded by profit on existing drugs, are important, reasonable and proper reasons for ticking the box to prevent generic substitution. Doctors would understand the factors of "investment in Australia", "all profit to research" and "patient and doctor support" as linked to the company that manufactures and sells Coversyl and not as factors relevant to regulatory decisions. They would understand that they were being asked to take those factors into account in forming the decision whether or not to tick the box on the prescription. 112 These representations, in the first whole page advertisement, are not misleading as alleged.