Medical products

Free offers of medical products – No violation of the prohibition on promotional gifts under Hwg 7(1) when the purchase price is refunded in full

In the case at issue, the plaintiff, on the basis of Sections 8, 3, 3a of the German Unfair Competition Act (UWG) in conjunction with Section 7(1) Nr. 1 of the German Health Advertising Act (HeilmittelwerbegesetzHWG), sought an injunction against defendant’s promotional offer “Incontinence Pants – FREE TRIAL” which was challenged as in violation of competition law.

Specifically, the defendant had affixed a folded sticker containing the words “FREE TRYon the packaging of its medical product. The inside of the sticker contained instructions on how to obtain a refund of the purchase price after purchasing the product by uploading to the defendant’s website a photo of the payment receipt and the promotional package and providing the name, address and bank details, after which the purchase price would be refunded within 14 days.

The Higher Regional Court of Cologne (judgment of 17 December 2021, file no. 6 U 91/51) upheld the decision of the Regional Court of Cologne (judgment of 25 May 2021, file no. 33 O 60/20) to reject the action and dismissed the appeal against said decision.

In his appeal, the plaintiff argued that the defendant could not rely on the exceptions provided for in § 7, paragraph 1, no. 1 of the HWG, because the limit of the lower value is exceeded when the purchase price exceeds at least eight euros. The other exception in Section 7(1) No. 2(a) of the HWG was irrelevant because the public would not view reimbursement of the purchase price as a gift, but rather as acquiring the product. Furthermore, a full refund of the purchase price is not covered by this provision.

The Higher Regional Court, on the other hand, found no violation of Section 7 (1) HWG. According to this provision, it is in principle inadmissible to offer, advertise or grant advantages and other promotional gifts (goods or services). The term “promotional gift” should be interpreted broadly and includes any free gift in connection with the purchase of a product or service. In the opinion of the Tribunal de Grande Instance, the reimbursement of the purchase price described above constitutes such a free gift. However, the the exception under Section 7 (1) No. 2 (a) HWG applies here, whereby the benefit or promotional gift is permitted if granted for a specific amount of money or for an amount of money calculated in a certain way.

In this case, the Cologne courts therefore did not consider the product itself as the gift, but rather the purchase price reimbursed under the conditions described. Therefore, the exception for low value items under Section 7(1) No. 1 HWG was not relevant.

The decisive factor in this respect is that the product must first be fully paid for by the consumer. The consumer therefore does not understand the message on the sticker to mean that the product is given away free of charge. Also, the consumer is informed of similar promotions, so he will take into account the additional information on the reimbursement conditions appearing inside the sticker. In addition, the refund relates to the total purchase price of the product and therefore to a “specified sum of money or for a sum of money calculated in a certain way”. The fact that the full purchase price is refunded is also not in contradiction with this, since the wording of Article 7(1)(2) (a) of the HWG does not provide for any relative or absolute limitation on the amount of the donation. Accordingly, in the opinion of the Higher Regional Court, the except for Section 7 (1) No. 2 (a) HWG does not to fail due to lower limit value of Section 7 (1) No. 1 HWG nor is it in conflict with this provision.

The Higher Regional Court of Cologne thus follows the decision of the Higher Regional Court of Hamburg, which had previously rejected a previous request for an injunction (judgment of 20 June 2019, file no. 3 U 137/18).

The decision concerns an interesting and finely drawn line between the two exceptions to the fundamental prohibition on promotional gifts under Section 7(1) HWG and illustrates the complexity surrounding the legal assessment of promotional activities for drugs and products. medical, in particular in the planning of such promotional activities. It is strongly recommended to seek legal advice here.

This judgment is one of many decisions which raise the bar for the promotion by pharmaceutical companies of corresponding products. Particular attention should always be paid to the prohibition of promotional gifts under Section 7 HWG discussed here. See also the articles “Mandatory information in pharmaceutical advertising” of the September 7, 2021and “Provision of Complimentary Samples to Pharmacies Pursuant to Section 7 HWG” of April 14, 2021.

Joan J. Dean

The author Joan J. Dean