Medicines and Related Substances Amendment Bill RETAILERS’ ASSOCIATION Health Portfolio Committee, 6 August 2008

Introduction Thank you for opportunity Retailers’ Association/RA: consists of large retailers and associated smaller independent franchise operations The RA submission is in addition to submissions made by its members This submission follows the written submission Members are:

RA Members New Clicks Holdings Ellerine Holdings Edcon (Pty) Ltd Foschini Group JD Group Mass Discounters Massmart Metcash Pick ‘n Pay Shoprite Checkers Smollan Group SA (Pty) Ltd Spar Group Ltd Truworths Woolworths (Pty) Ltd

Comments Definition of product: will include cosmetics as per the Foodstuffs Cosmetics & Disinfectants Act, “of which a medical claim is made” or “of which medicinal claims are made” Same applies to foodstuffs No definition of “medical claim” or “medicinal claim” Leads to uncertainty re application of Bill for manufactures, importers, distributors, retailers as to whether the Bill applies Basic principle of our law is certainty Will have to assess each product to see if applies

Products will be assessed by the SA Health Products Regulatory Authority (“Authority”) – at its discretion as to whether they fall within the Bill This lack of certainty will render the Bill susceptible to legal challenge both on a product-by-product basis and potentially before the Constitutional Court re the final amended Act Proposed definition of “medicinal claim”: “means a product in respect of which any statement is publicly made or advertised that states that a product is or purports to be suitable for use in correcting, restoring or modifying any physiological function in a person”

Difficulties arise when one considers the application of certain sections of the Act as amended by the Bill, such as: the term “advertisement” is to be amended so as to apply to all products regulated under the Act thus the restrictions applicable to the advertisement of medicines will apply to foodstuffs and cosmetics that fall within the Bill’s definition of “product” a distinction will have to thus be drawn between foodstuffs and cosmetics that fall within the Act and those that do not foodstuffs and cosmetics that fall within the Act will be required to be registered before they may be lawfully sold or marketed the regulatory regime applicable to medicines (re marketing and the sale) will then also be applicable to foodstuffs and cosmetics that fall within the Act

the consequence of this is that in addition to the manner in which these products may be advertised and sold, such products may only be sold subject to the conditions imposed at the time of registration of the product the containers of cosmetics and foodstuffs will also have to comply with the Act the prohibitions that apply to the supply of medicines ito incentive schemes, rebates, discounts or bonusing, will also apply to foodstuffs and cosmetics it is a widespread and accepted practice to sell cosmetics on an incentive basis and this will no longer be allowed, leading to loss of income for employees

the Authority will be allowed to publish information relating to any product under its jurisdiction in the RSA this information could include information of a sensitive nature, for example, re intellectual property or commercially sensitive information and this could interfere with the competitive value of the product subject to such publication the manufacturers, distributors and wholesalers will be subject to the Act’s licensing requirements, and will be required to obtain a licence to manufacture, distribute or sell the products in the RSA possibility of single exit pricing applying to cosmetics and foodstuffs that fall within the Act

the regulatory regime that traditionally applied to medicines, will apply to certain foodstuffs and cosmetics, and will require that manufacturers, wholesalers and distributors of these products comply with these onerous regulatory requirements  this will contribute to the costs applicable to producing and selling these products in the RSA

Based on what has been said, it is arguable that the distinction between products of the same class or category that fall within the Act, and those that do not, may infringe upon: the equality, dignity and freedom of trade provisions of the Constitution the lawfulness of the Bill, in so far as the principles of legality and administrative law are concerned (especially re s 33 of the Constitution: right to procedurally fair administrative action)

Duplication and over-regulation is also a concern: overlap with Foodstuffs Cosmetics and Disinfectants Act and its Regulations overlap with the Consumer Protection Bill e.g. misleading adverts, the sale of products of questionable quality, trade descriptions the increased regulatory burden will add to regulatory and compliance costs certain products may thus no longer be imported into the RSA due to viability issues and such imported products may be seen as being subject to a “barrier to trade”  consumers in the end will be confused re what law applies, and be prejudiced re higher costs and possible lack of product choices

Recommendations Conduct a RIA as per the draft RIA framework prepared for National Treasury Consult with the DTI re the Consumer Protection Bill If the Bill is to be retained, define “medicinal/medical claims” or narrow down definition of “cosmetic” and “foodstuffs”

Thank you for the opportunity to give the RA’s comments on the Bill -00-