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Ministry Prosecutes over Medicines Act Breaches

9 Feburary 2006

Ministry of Health Prosecutes over Medicines Act Breaches

Three companies and two individuals have been found guilty of breaching the Medicines Act and Regulations in the selling of medicines to overseas retail purchasers over the internet and in the advertising of the medicines over the internet.

Medsafe's team leader of compliance Derek Fitzgerald has welcomed the judgement of Judge Neil MacLean, released today. The decision follows a defended hearing held over 10 days in the Hamilton District Court in October and November last year.

Derek Fitzgerald says that it is important that the public safety provisions in the Medicines Act and Regulations are met.

All 111 charges laid against three Hamilton-based companies - Ink Media Ltd, Ink Electronic Media Ltd and Standard 304 Ltd and the companies' directors, father and son Wallace Leslie Waugh and Ian Wallace Waugh, were found proven by the court.

Ian Wallace Waugh was absent overseas during the proceedings and is expected to face a further 17 charges upon his return to New Zealand.

The proven charges include selling a prescription medicine without a prescription, selling medicines by wholesale transaction without holding a wholesale licence, selling unregistered medicines, unlawful possession of medicines and breaching advertising restrictions.

The company had advertised medicines without providing legally required information including potential adverse effects, warnings, precautions and notification of the classification of the medicine.

The Court heard from over thirty prosecution witnesses, most of whom were required to attend for cross-examination. The Court found that Ian Waugh and Wallace Waugh had decided that they would change an already established operation to supply medicines to persons overseas. Through Ink Electronic Media Limited and Ink Media Limited and using a Fijian company, the defendants caused medicines, including prescription and restricted medicines, to be supplied to overseas consumers.

An elaborate, complex and inter-connected network of websites was established into which a substantial and regularly updated flow of information by way of advertising and other information was loaded onto websites at the direction of the defendants.

Arrangements for obtaining medicines through New Zealand wholesalers was organised from the defendants' Hamilton premises and then arrangements made for supply of the medicines to the Fijian company. The Hamilton offices also supplied packaging and ancillary equipment to the Fijian company, which was essentially a warehousing and dispatching facility.

A substantial proportion of the sale proceeds came into the bank accounts of the defendants. In the period from November 2001 to August 2003 the whole enterprise had a turnover of over $10 million.

The Court heard of the dangers of selling prescription medication without the individual being under the care of a doctor who had assessed the patient's condition and made an appropriate prescribing decision. Also, the importance of the system of licensing of wholesalers and manufacturers of medicines and the risks associated with a lack of a record-keeping trail if there are recall issues.

Two instances of the dangers of selling prescription medicines without a prescription, highlighted in court, were the sale of anti-depressant Amitriptyline, which if taken in excess can be fatal and the prostate treatment Proscar and hair treatment Propecia, which contain finisteride which has the potential to cause foetal abnormalities in pregnant woman.

Medsafe's Derek Fitzgerald says the aim of the Medicines Act is to ensure that consumers receive medicines that are safe, effective and of acceptable quality.

"Internet sales of prescription medicines place patients at unacceptable risk, because no professional diagnosis is required prior to the purchase of medicines for serious conditions", says Mr Fitzgerald.

"Certain medicines may not be appropriate for particular patients. The patient may be allergic to the product, side effects may result in further health issues or the product may interact with other medications the patient may be taking".

Ink Media Ltd, Ink Electronic Media Ltd, Standard 304 Ltd and Wallace Leslie Waugh will be sentenced in the Hamilton District Court on April 28th.


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