Australian consumer watchdog appeals lenient fine imposed on multi-national drug maker

Australia's consumer watchdog on Monday filed an appeal against a 1.7 million Australian dollar fine levelled on a multi-national pharmaceutical company, claiming it could be viewed as "a cost of doing business."

The 1.7 million Australian dollar (1.23 million U.S. dollars) fine was levelled against U.K based Reckitt Benckiser by Australia's federal court earlier in May after the drug manufacturer admitted it had breached Australian consumer law by misleading consumers on marketing its Nurofen product.

However Australian consumer watchdog at the time said the fine did not go far enough, claiming a penalty of at least six million Australian dollars - the legal maximum - would have been appropriate.

"The ACCC will submit to the Full Court of the Federal Court that 1.7 million Australian dollars (1.23 million U.S. dollars) in penalties imposed on a company the size of Reckitt Benckiser does not act as an adequate deterrent and might be viewed as simply a cost of doing business," Australian Consumer and Competition Commission (ACCC) chairman Rod Sims said in a statement on Monday.

"This is particularly the case when the judge found that Reckitt Benckiser had made many millions in profits from sales of 5.9 million units of these products at around 8,500 outlets during the relevant period."

The court in December had found Reckitt Benckiser's products contained the exact same amount of the ibuprofen lysine active ingredient as the company's standard pain medication, however was selling "pain-specific" medication at almost double the price.

Reckitt Benckiser did not immediately respond to Xinhua's request for comment.

Reckitt Benckiser was forced to remove its products off Australian shelves and pay the ACCC's legal costs, however Australian consumer advocacy groups claim that penalty was lenient in light of the scale of the deception.

"If a 10 million Australian dollar (7.23 million U.S. dollar) per breach penalty had been available in this case, like it is available under parts of the Competition and Consumer Act, Reckitt Benckiser could have been facing a more appropriate fine of 60 million Australian dollars (43.40 million U.S. dollars)," Tom Godfrey, spokesperson for consumer advocacy group Choice told Xinhua, adding the amount equals the profit difference between pain specific and generic medication.

"This was, and still is one of the greatest consumer cons of all time." Endit