Australia: Social Media and Life Sciences Companies: In or Out of Control?

Life Sciences Spotlight
Last Updated: 1 March 2012
Article by Amanda Turnill, Ingrid Eliasson and Paul O'Brien


While here in Australia, and abroad, guidelines and legislation have been developed on how to regulate this growing area, responsibility for content on social media sites remains a key issue. This article will examine the position in Australia, Europe (in particular the UK and Sweden) as well as the US.

Broadly speaking, the regulation of the pharmaceutical industry in Australia and Europe is quite similar. Both use a system of self-regulation and rely on penalty orders and fines to maintain adherence to their respective advertising guidelines. Further, while all jurisdictions have provisions of their respective codes that regulate advertising on the internet, none have fully grappled with the distinct nature of the social media issue. Sweden is ahead of the other jurisdictions, but has not yet definitively laid out a clear plan on how to regulate this area. Finally, the operation of a constitutionally guaranteed right to freedom of speech in the US adds a different perspective to this issue.

What is social media?

First and foremost, the lack of a clear definition of social media is a key issue for industry. Sensibly, before an area may be regulated, we need to know exactly what is being covered. Australia's definition appears to be the most thorough, defining social media in the 16th edition of the Medicines Australia Code of Conduct (MA Code) as "the various activities that integrate technology, social interaction, and the creation of content".

Similar to other jurisdictions, the MA Code uses examples of social media websites to clarify its definition; including Facebook, Twitter and Wikipedia. And whilst on any view these sites would be regarded as "social media", these examples do not cover the spectrum. The result is that guidance notes issued in these jurisdictions for the pharmaceutical and medical device sector are not meaningful in terms of evaluating the obligations that exist for life sciences companies.

Generally speaking, industry guidance in Australia, Sweden and the UK all infer, or explicitly state, that promotion on social media must be regulated in the same way as any other promotion that occurs in each jurisdiction - that is, promotion to the public is generally prohibited. However, this fails to acknowledge the inherent differences between social media and more traditional media, as well as the incredibly wide definition of promotion, at least in Australia.

In our view, advertising on social media websites requires stricter regulation than other promotions, due to the unprecedented relationship between companies and their consumers. The existence of direct dialogue between these parties means that it is often unclear what content may be classified as an "advertisement" on social media. By only adopting the current regulatory stance in relation to promotion on social media, pharmaceutical companies are being forced to rely on their own internal guidelines, rather than any specific industry or legislative standard. This confusion is most apparent when exploring the issue of control.


Social media sites present an opportunity for pharmaceutical companies to interact with the general public. However, despite the forum, these opportunities for engagement are governed by the various regulations that normally manage this relationship.

For example, in Australia and Europe, a pharmaceutical company will be liable for any statements on social media within their "control" that breach their local regulatory guidelines, ie documents such as the MA Code . However, adding confusion to the mix, no regulatory body or national judiciary has as yet defined "control" in the context of social media.

Due to its very nature, social media makes it is more difficult to determine which party actually controls or is responsible for certain comments on websites. For example, while a Facebook page may be created by one party, any member of the general public (with a Facebook account) may write comments on that page. The issue, therefore, becomes "when is a company in control of thirdparty comments on its social media sites?" A more difficult question is whether a pharmaceutical company will generally be liable for third-party comments.

This issue of control has been discussed in both regulatory guidance and case law, but neither has provided definitive guidance on this issue. As a result, pharmaceutical companies are unclear of their responsibilities. Without adequate guidance on what social media a pharmaceutical company may control (ie is effectively responsible for), companies are unable to develop a clear and coherent social media policy. This lack of guidance was illustrated in August 2011, when Facebook restricted pharmaceutical companies' ability to disable the comment feature on Facebook pages run by them. Given the uncertainty, some chose to close down parts of their Facebook account while others introduced policies on third-party comments, which detail when such comments may be deleted.

The Swedish LIF discusses control in the context of social media in its guidance note on Social media and ethical rules for the pharmaceutical industry in Sweden. This states that if a pharmaceutical company creates a comment (or by its actions allows a comment to be created on one of its pages), it will become responsible for such a comment. This type of policy places additional burdens on pharmaceutical companies, which are then forced to regularly monitor these sites.

In Australia, the explanatory notes to the MA Code outline which social media content a pharmaceutical company will have control of. Though revisions to the MA Code are currently being prepared and may include greater comment in this area, at present it appears clear that control or responsibility will be established where a company engages with a social media site. Although the explanatory notes do not define what constitutes "engagement", in one view it could be assumed that all content posted by it on any such site would constitute engagement, as well as any dialogue with the general public, such as directing consumers to visit the site. What is less clear is whether observing conversations on a third party's website would be viewed as engagement. For example, if a pharmaceutical company observes disparaging or misleading comments about a therapeutic good it sponsors on a website (which they do not administer), would this constitute engagement?

Last year the Federal Court of Australia discussed the issue of responsibility in ACCC v Allergy Pathway Pty Ltd (No 2).1 This case concerned comments posted on Allergy Pathway's Facebook page by both Allergy Pathway and its customers. The key issue in the proceedings was whether Allergy Pathway was responsible for third-party comments. The Federal Court concluded that Allergy Pathway was responsible for third-party comments where it knew of them and made a decision not to remove them from its Facebook page. This principle stems from early defamation cases that concerned notices published on bulletin boards by third parties.2 In this case, as Allergy Pathway a) knew of the posts and their content; b) had the power to remove the posts; and c) took no steps to do so, it assumed responsibility. The second element of this approach to responsibility considers control. Effectively, if a pharmaceutical company has the power to remove posts from social media, it is likely to be considered to have control, and potential responsibility, in relation to that post.

In one view, this approach by the Federal Court does not appreciate the true nature of social media and, consequently, has the potential to place an undue burden on pharmaceutical companies. It would be a mistake to assume social media is merely a direct dialogue between a pharmaceutical company and its consumers. Whilst this is one element of social media, such as Twitter and Facebook, this definition underestimates its broader application. One key element that has been overlooked by various pharmaceutical industry bodies is the "mass collaboration" (between all parties on social media sites) that occurs in social media. While this collaboration can often be limited to a party's own comments and web pages, such as Facebook, other sites allow the general public to edit and engage with a site without restriction. For example, Wikipedia allows any person to edit and remove any content on any page without limitation.

In the pharmaceutical sector, if this occurs, the Allergy Pathway case means that companies may be required to constantly review these sites. Failure to do so could lead to a risk of breaching the responsibility test outlined in that case. As such, a clear definition of social media is required so that regulatory bodies and the judiciary are able to develop clear guidance on what content pharmaceutical companies will be responsible for. It is only when the intricacies of social media are understood, that the responsibilities of pharmaceutical companies regarding this burgeoning medium can be contemplated.

Ultimately, companies in Australia and Europe need to be cautious in their dealings on social media.

The US position

As a result of the First Amendment of the Constitution, the US position on internet regulation is distinct from Australia and Europe. Realising the beneficial effect of an internet without government regulation or interference had on society, the US Congress enacted the Communications Decency Act of 1996, 47 USC § 230 (CDA). The CDA created immunity for "interactive computer services", for any claims regarding third-party comments made on their sites.

Interactive computer services are defined in the CDA as software providers that enable access by multiple users to a specific service or system, such as Facebook and Twitter. As US courts have adopted an expansive definition of interactive computer service,3 pharmaceutical companies that operate social media sites would also be regarded as interactive computer service providers. Consequently, such companies are likely to obtain the immunity under the CDA for third-party comments posted on their social media sites.

The US position, contained in the CDA and case law, varies from the Australian position because of the divergent origins of each country's law. Whilst Australia focuses on defamation as the starting point, the US' faith in the paramount importance of the freedom of speech allows for the unfettered dissemination of content on the internet.4

This position is quite interesting as internet publishers are therefore treated differently to their counterparts in print, television and radio.5 The impact of this remains to be seen, but perhaps the courts have viewed this medium as more of a conduit for public expression, rather than journalistic enquiry.

As a result of the CDA and its subsequent interpretation by US courts, pharmaceutical companies do not presently appear to be liable for comments made on social media sites made by third parties. The exception to this rule would apply if a pharmaceutical company forced a third party to make comments on their sites using questions or open-ended surveys under duress.

In light of these contrasting approaches to third party comments, international companies must be cautious when creating internal policies for dealing with social media.


1ACCC v Allergy Pathway Pty Ltd (No 2) [2011] FCA 74
2See for example, Byrne v Deane [1937] KB 818;Urbanchich v Drummoyne Municipal Council [1991] Aust Tort Reports 81-127 (NSW SC).
3Carafano v Metrosplash, Inc., 339 F.3d 1119, 1123 (9th Cir. 2003).
4Batzel v Smtih, 333 F.3d 1018, 1027 (9th Cir. 2003).
5Carafano v Metrosplash, Inc., 339 F.3d 1119, 1124 (9th Cir. 2003).

© DLA Piper

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DLA Piper Australia is part of DLA Piper, a global law firm, operating through various separate and distinct legal entities. For further information, please refer to

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