Fines company Rs150m for deceptive marketing
The Competition Commission of Pakistan has penalised Reckitt Benckiser Pakistan Limited Rs150 million for what it said was deceptive and misleading marketing of one of its products, Strepsils.
The commission said that the company is accused of disseminating misleading information to consumers by creating an impression its product ‘Strepsils’ is a drug for a sore throat and cough.
Square Distribution and Marketing System (Pvt) Limited sent a formal complaint to the commission making the allegation.
It alleged that Strepsils was de-registered as a drug when acquired by Reckitt from Boots in 2005, and then re-launched with the disclaimer, “non-medicated lozenges.”
However, the company made no effort to educate and inform consumers on the discontinuation of a medicinal ingredient in it.
This was followed by a CCP inquiry, which concluded that the marketing campaign appears to be deceptive and goes against competition laws which prohibits the distribution of false and misleading information to consumers.
“Moreover, the marketing campaign demonstrates that the public was actually deceived into perceiving that ‘Strepsils’ was still a medicated sore throat remedy,” the CCP said. “The respondent’s misleading campaign was also capable of harming the business interests of others.”
The CCP order added that branding has a significant role in marketing products, and therefore, the change in formula of the product has changed the character from being a medicine to a non-medicated product.
“Did you know that Strepsils is only a candy and it can’t cure anything,” said the CCP spokesperson.
The history of the brand ‘Strepsils’ and the fact that, internationally, it is known and marketed in various jurisdictions as a medicinal product, means that the disclosure of the fact that it is not medicated in Pakistan becomes compulsory.
The CCP bench observed that the disclaimer on the box was not enough. It said the company has not been able to explain properly how and to what extent it made an effort to inform the public about the change in formula.
“Barely printing ‘non-medicated lozenges’ on the product box and that too in a very small font does not discharge the onus of making due and sufficient disclosures of such material change in the character of the product,” said the CCP statement.
The bench has directed the company to print ‘NON-MEDICATED’ as a disclosure in English and Urdu in bold on the box as well as on the strips.