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An online pharmacy allows people to purchase medication and communicate with pharmacists online or over the phone. The convenience and safety of this is appealing, particularly in a COVID world where many don’t want to step outside if they are not feeling well.
Starting an online pharmacy business is still a relatively new area. Therefore, it’s important to carefully navigate the legal aspects of it so you can confidently provide your services without the risk of it crashing down if something goes wrong.
In this article, we’ll look at how to do this and discuss:
- Starting an online pharmacy
- What policies are required
- Licences and registration
- Selling prescription medication
- Schedule 4 drugs
- Telehealth services
- Liabilities
- Misleading and deceptive conduct
- Insurance
Are Online Pharmacies Legal?
Yes, operating an online pharmacy is legal in Australia. However, in order to do this correctly, it’s important to make sure you follow the right regulations so your online business is well protected and not in violation of any laws.
The main regulation that will determine how you can go about operating an online pharmacy is the Therapeutic Goods Act 1989. The legislation covers matters such as:
- Trading pharmaceutical goods
- Import and export of goods
- Items that are considered exempt
- Approvals and determinations
- Possible criminal and civil penalties
You can find more information on the Therapeutic Goods Administration (TGA) website. The TGA webpage is currently being updated, so keep an eye out for any changes in the near future.
How Do I Start An Online Pharmacy
An online pharmacy needs to be registered, set up and structured all the same as a non-medical business. Once you’ve established a business plan and have the funds ready, you will need to follow these general steps in order to start an online pharmacy business:
- Decide on a business structure for your online pharmacy
- Register the business online
- Open up a bank account for the pharmacy
- Ensure all licences and permits are up to date
- Apply for taxes
- Secure all relevant legal documentation
We’ll discuss some of these points in more depth below – keep reading to find out more.
Legal Policies For Running An Online Pharmacy
As a business that is operating on the web, the online legal policies you use will be some of the most important documents regarding your business.
Not only do these policies aid in keeping your business protected, but they can also help build better transparency and trust with your customers.
So, which policies are best for your online pharmacy?
Terms & Conditions For Your Online Pharmacy
The terms and conditions of your online business will be one of the most important aspects of your business. Terms and conditions generally regulate how customers can interact with your website. It sets out their roles and responsibilities as well as your duties to them.
Essentially, users and customers will need to agree to your terms before they can further engage with your business or purchase any goods from you.
Having a terms and conditions agreement in place affords greater protection from liabilities, especially when you’re dealing with medication online.
Does An Online Pharmacy Need A Privacy Policy?
A Privacy Policy is a legal document that alerts customers about how their information is collected, used and stored. It should attempt to remain transparent about your process of using your users’ personal information and the reasons for collecting it.
Any business that collects the personal information of their clients must have a Privacy Policy in place.
More specifically, if your business has an annual turnover of more than $3 million, you are required to have a Privacy Policy under the Privacy Act 1988.
However, there are some exceptions to this rule. One of them is if your business collects and handles health information.
So, let’s say you’re an online pharmacy that requires customers’ health information before they purchase products. Even if your annual turnover is less than $3 million, you still need to have a Privacy Policy under the Act as health information is an exception to the threshold.
Furthermore, businesses collecting health information are generally held to a higher standard by the law. Any personal or health information that is collected must have explicit consent prior to collecting it.
As a result, the Privacy Policy you have for your online pharmacy would be different from a regular one.
Feel free to contact us today about a Health Service Provider Privacy Policy.
Does My Online Pharmacy Need A Cookie Policy?
As you may know, cookies are used to keep track of user preferences. This, in turn, may be used to further a business’ marketing activities and goals.
However, it’s important to balance this with the user’s right to know how their information is being used.
It’s encouraged to have a Cookie Policy if your online business uses cookies for any reason. This informs users of how you use their cookies and for what purpose.
This is also good for strengthening your relationship with your customers and boosting the level of trust.
Online Pharmacy Reviews
Opening your business up to online reviews can be a great way to attract more customers. In fact, reading positive reviews from other customers can influence other potential customers to buy from your business.
However, there are instances where a customer review may be less than shining. In this case, there are multiple courses of action.
First, you can look to get the review removed if it’s on a third party site such as Google Reviews (however, it is not promised that this path will result in your desired outcome).
There is always the option to reply directly to the customer in an effort to smooth over the situation.
Lastly, if a negative customer review is persistent, false and having defamatory impacts on your business, then you have the option to pursue legal action.
We’ve written more about how your business can deal with negative online reviews – it’s worth having a read to prepare your business for unexpected mishaps.
Do I Need To Register My Online Pharmacy?
Regulations that apply to traditional and physical pharmacies also apply to online pharmacies (although this is not expressly stated, m there are simply no separate regulations for online pharmacies).
Therefore, you will need to register your pharmacy as per the regulations of your state.
In order to register a pharmacy, you must:
- Be a registered pharmacist or working with one
- Have the businesses name registered with ASIC
- Meet all relevant regulations for a setting up a pharmacy
Do I Need Any Licences To Run An Online Pharmacy?
In order to operate a pharmacy, you will need to be a legally recognised pharmacist in Australia. If not, the pharmacy will need to have a partner that is a registered pharmacist.
Additionally, in order to supply prescription medication and other pharmaceuticals, a licence is required under the Poisons and Therapeutic Goods Act 1966 which can be done online.
Along with the above, in order to sell the goods, you need approval from the Therapeutic Goods Administration. Apart from licences, the businesses will also need to follow regulations set out by the Pharmacy Board of Australia.
Selling pharmaceuticals is not taken lightly in Australia, so it’s best to seek the advice of a legal professional before proceeding to ensure all your licensing obligations are covered.
Can I Sell Prescribed Medicine Online?
There is no straightforward answer to this question. Selling prescribed medication online will primarily be subject to the rules and regulations of each individual state. It’s best to check and be up to date with the regulations of your locality.
In most cases, prescription medicine can only be sold online after the patient has submitted proof of a prescription from a doctor. Once a client has done this, the pharmacy is then able to send the client the medication.
There are certain risks involved, such as fake or forged prescriptions. Make sure you have a vetting process in place to ensure your business doesn’t fall victim and expose itself to potential liabilities.
It’s wise to check the regulations of your state or territory and operate accordingly.
What Are Schedule 4 Drugs In Australia?
Schedule 4 drugs are those medications that need a prescription from a healthcare provider in order for an individual to be able to purchase them. They cannot be sold over the counter and to just anyone.
Examples of schedule 4 drugs include:
- Methandriol
- Oxandrolone
- Stanozolol
- Ethylestrenol
- Methylandrostanolone
Essentially, Schedule 4 medicines can only be sold by pharmacies as they are considered ‘authorised persons’.
There are also Schedule 8 drugs, which includes ‘controlled drugs’. This is slightly stricter than those in Schedule 4 as they require a special prescribing permit. This is because these medicines are likely to cause addiction, such as morphine and oxycodone.
You can read more about scheduled medicines here.
What Are Telehealth Laws In Australia?
Telehealth is the act of accessing medical consultations from a health service provider either by a phone call or video call. Providing a telehealth service is legal in Australia and makes medical services accessible for those who don’t live near the services they may need or cannot travel.
In order for a medical practitioner to conduct a telehealth consultation with a patient, they must have visited the practice in person within the last 12 months. In extremely limited circumstances, this rule is waved.
What Does The Privacy Act Say About Telehealth Services?
According to the Privacy Act 1988, telehealth service providers must take reasonable steps in order to secure the privacy of their patients. Much like traditional types of medical information, a telehealth patient’s medical records should be secured and never be disclosed to another without their consent.
It is also the responsibility of telehealth providers to inform patients of how their data will be used, including its collection, storage and utilisation for matters such as training services.
Patients should have the right to choose whether or not they give consent to how their information is used.
Do I Need A Telehealth Service Agreement?
A Telehealth Service Agreement covers all the important information customers need to know, prior to them proceeding with the service.
It’s important not only for the knowledge of customers, but also, for the protection of your business to have matters such as privacy, confidentiality and services (as well as anything else you might deem important for your businesses) covered in a Telehealth Service Agreement.
Is A Store Liable For A Customer Injury?
Stores can be liable for customer injuries, however, this depends on the type of incident that has occurred, supply chain issues and any protections or liabilities the store has. As a result, your online pharmacy can be put at risk if a customer has been harmed after using a product they purchased from you.
As the owner of the business, there are ways to protect your business and take reasonable measures to prevent this from happening. Contact us today to find out more about your liabilities.
What Is A Customer Injury Report?
A customer injury report is required by Australian Consumer Law (ACL) once a business has learned of a serious incident involving one of their customers.
The report should be submitted within two days of learning about it and needs to be done whether or not there was misuse of the product.
What Is Misleading And Deceptive Conduct?
Misleading and deceptive conduct includes any statements, omissions or acts that lead a customer to believe something false about a product or service. Under the ACL, misleading and deceptive conduct is strictly prohibited.
Therefore, it is the responsibility of your business to actively ensure that all the information provided is clear, factual and up to date.
Consumers carry the right to make a complaint or seek remedies for situations where they have been a victim to misleading or deceptive conduct.
Refunds And Exchanges
According to the ACL, customers also have the right for refunds and exchanges to a certain degree. We encourage businesses to have a system in place for this as at times, things can go wrong.
If a customer has received an item that is faulty or in bad condition, they retain the right to have it returned or exchanged for another one.
Do I Need Insurance For My Online Pharmacy?
There is no legal requirement to have insurance for your online pharmacy. However, it’s highly recommended to consider getting cover when dealing with medicine. After all, businesses handling health information are generally held to a higher standard of care.
There are risks associated with selling pharmaceutical products to customers and you want to make sure your business is protected if something goes wrong.
Key Takeaways
Setting up an online pharmacy in Australia can be a promising venture. If done correctly and legally, you’d be providing greater access to a much needed service.
However, it is extremely important that you prepare for all your legal obligations beforehand to make sure your business starts off strong. You also want to protect your business from any risks.
To summarise what we’ve discussed:
- Online pharmacies are legal, however, it’s important to comply with the regulations that apply
- Starting an online pharmacy includes registering and setting up your business as you would any other
- You still need to register your online pharmacy and get any relevant licences
- There are limits and regulations on the types of medications that can be sold
- Ensure you have strong online policies and look into getting a Telehealth Service Agreement
- Be aware of any obligations under the ACL, such as reporting customer injuries and practising consumer rights
- Consider getting insurance for your business to combat any risks
If you would like a consultation on setting up an online pharmacy, you can reach us at 1800 730 617 or team@sprintlaw.com.au for a free, no-obligations chat.
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