The Therapeutic Goods Administration (TGA), which is a part of the Australian Government Department of Health and Ageing, administers the following legislation:

This legislation regulates the manufacture, supply and advertising of therapeutic goods (health products) in Australia to ensure they are safe and fit for their intended purpose.

Therapeutic goods include medicines (whether prescribed by a doctor, recommended by a pharmacist or bought at a supermarket) and medical devices.

Most therapeutic goods must be entered on the Australian Register of Therapeutic Goods before they can be supplied in Australia. However, there are some goods which are exempt altogether from being entered on the register, some which may be listed only and others which must be registered.

Listed goods are considered to be lower risk and are not evaluated; they are presumed to be safe and sponsors can make any claims about their use and effect as long as they do not breach the Therapeutic Goods Advertising Code (No. 2) 2018 (Cth). Sponsors must certify that they hold evidence to support any claims they make in relation to the goods and that those claims are substantiated. Registered goods, by contrast, are evaluated for safety and effectiveness by independent expert advisory committees of the TGA.

Most therapeutic goods must be accompanied by consumer information stating what the goods are used for and how they work, contraindications, precautions and possible side-effects, guidelines for proper use and storage and unwanted effects or overdose and what to do in such situations.

The TGA may require a sponsor to recall goods if faults are detected. Faults may include that the goods do not conform to standards or that they do not meet licensing, listing or registration requirements. Alternatively the TGA may require a sponsor to inform the public that a fault has been detected or publish specific information about the product.

The Australian and New Zealand Governments signed an Agreement for the Establishment of a Joint Scheme for the Regulation of Therapeutic Products on 10 December 2003 and on 20 June 2011 the respective Prime Ministers signed a statement of intent to implement the agreement over a period of up to five years.

Usually there is a contract involved in the supply of a health product. The contract, which need not be written, is between the supplier (usually a pharmaceutical company) and the user. If a product is faulty, or not fit for the purpose for which it was sold, the contract is breached. A breach of the terms of the contract is enough to bring an action. There need not be any carelessness involved unless the contract only promised that the supplier of the services or product would exercise reasonable care. For more information, see CONSUMERS AND CONTRACTS, Contracts, Defective Goods.

In cases involving the sale of goods, the injured person can use consumer protection laws such as the Sale of Goods Act 1895 (SA) or the Competition and Consumer Act 2010 (Cth). For more information, see CONSUMERS AND CONTRACTS, Consumer Protection.

Sometimes an action may be taken against the manufacturer instead of, or as well as against the supplier. For example, the contract might not give the injured person the necessary legal rights or the manufacturer may be better able to meet large claims because it is adequately insured. There are statutory rights against manufacturers under the Australian Consumer Law, which is contained in schedule 2 of the Competition and Consumer Act 2010 (Cth).

Manufacturers are usually sued for breach of the guarantees contained in the Australian Consumer Law [see in particular schedule 2, ss 54-56], for breach of other provisions of the Australian Consumer Law [see in particular shcedule 2, ss 106 and 138] or for negligence at common law.

The extent to which negligence, or carelessness, must be proved varies from case to case. It commonly involves satisfying the court that it was more probable than not that the plaintiff's injury was caused by the negligence of the manufacturer.

If a number of people have been injured by the same product it is now easier to take a class action (make a claim as a group) [see Competition and Consumer Act 2010 (Cth) sch 2, s 149 and the Federal Court Rules 2011 (Cth)].

Liability may be found if the drug or device was not properly tested, if sterilisation and safety control measures were inadequate, or if the company failed to warn users of adverse reactions.

The manufacturer is also liable for the negligent acts of individual employees.

The court will consider the extent to which consumers were warned of adverse reactions or potential hazards by information attached to the product.

In the case of therapeutic products, much of the relevant information will be given to the consumer by the doctor. It is unclear whether or to what extent a warning provided by the manufacturer but not passed on to the consumer allows the manufacturer to escape liability.

In a claim of negligence, the manufacturer may argue that a plaintiff voluntarily accepted the risks associated with the durg or device or was careless in using it. A further difficulty confronting a plaintiff receiving a drug or device at a health service is in proving that the damage or harm complained of has been caused by the product and not by the health service. In other words, fault may lie with those administering treatment rather than with the product itself. When the faulty product is not the sole cause of the damage, difficulties and complexities arise which can have an impact not only on the amount which may be recovered, but also on the result of the case. These difficulties may be not only legal but also practical, such as the difficulty of obtaining evidence needed for success in the case.

To defend a claim, the manufacturer must usually show both that the consumer was aware of and understood a particular risk, and that he or she consciously decided to take the risk, or was reckless about whether or not a harmful result might occur.

What if the manufacturer cannot be identified?

If a consumer wishes to take action against a manufacturer for defective goods but does not know or cannot identify the manufacturer, they may request, by written notice, that the supplier provide details to identify the manufacturer [see Competition and Consumer Act 2010 (Cth) sch 2, s 147].

If no information is provided to identify the manufacturer within 30 days then the supplier to whom the request was made can be taken to be the manufacturer for the purposes of any action to be pursued.