Drug or cosmetic product? On the judgment of the Administrative Court of Cologne (Verwaltungsgericht Köln) of 13.08.2024 (Az. 7 K 2494/22)

The Administrative Court of Cologne (Verwaltungsgericht Köln) dealt in the past year with judgment of 13.08.2024 (Az. 7 K 2492/22) with the distinction between (presentation) drugs and cosmetics and clarified important delimitation issues.

Regulatory delimitation issues play a considerable role in material health products. For example, for the marketing of a vitamin-containing product in capsule form, it is of decisive importance whether it is a drug or a dietary supplement, i.e. a foodstuff. Comparable constellations can also arise with other product categories, such as medical devices or foods for particular medical purposes.

1. Facts

The claimant is a company that distributes dermatological products and placed the "Q.-Creme" on the market as cosmetic product. The packaging contained statements such as "intensive care for very dry, irritated skin and neurodermatitis" and "immediate relief of itching". The Federal Institute for Drugs and Medical Devices (BfArM) determined that it was a product requiring authorisation, as the product presentation suggested a pharmaceutical purpose. In particular, the mention of neurodermatitis and the emphasised effect of microsilver were assessed as evidence of a drug property.

2. Court decision:

The Administrative Court of Cologne (Verwaltungsgericht Köln) overturned the BfArM decision. It decided that the "Q.-Creme" was not a drug but a cosmetic product. The reasoning was as follows:

• the central product presentation aimed at "care" and not at the cure or treatment of a disease,
• microsilver and panthenol are admittedly also used in drugs, but are equally widespread in cosmetics,
• although the brand "L." also distributes medical devices, this does not necessarily lead to the product having drug properties,
• the overall presentation did not clearly indicate that the product was primarily intended for the treatment of diseases.

3. Relevant legal aspects:

• Definition of drug pursuant to § 2 Abs. 1 Nr. 1 AMG: A product is classified as a drug if it is marketed as a substance with properties for the cure or alleviation or prevention of human diseases.
• Definition of cosmetics pursuant to Art. 2 Abs. 1 of Regulation (EC) No. 1223/2009: Cosmetics are primarily intended to care for and protect the skin.
• Delimitation between drugs and cosmetics: What is decisive is the overall presentation, including packaging, advertising statements and consumer expectations.

4. Action recommendations for companies in the dermatology/cosmetics sector

In order to avoid products being incorrectly classified as drugs requiring authorisation, drugs dermatological companies should observe the following points:

• Packaging & advertising: Do not use formulations that suggest a healing or alleviating effect (e.g. "prevents inflammation"). Instead, use neutral care instructions (e.g. "supports the skin barrier").
• Avoidance of medical terms: Avoid mentioning disease patterns (e.g. "neurodermatitis") on the packaging or in advertising, or use them only in a purely care context.
• Promote ingredients carefully: Even if ingredients such as microsilver or panthenol may have a medical effect, they should be promoted primarily in connection with their care function.
• Consistent product communication: All statements in online presence, packaging and package leaflets should be uniform and send no contradictory signals.
• Legal review before market entry: A detailed analysis of product communication by experienced advisors can help avoid legal disputes.

Recommendation

With these measures, companies can minimise the risk that their dermatological products will be classified as drugs. This could otherwise result in costly authorisation requirements or lead to competition law disputes. We are happy to support the solicitors and specialist solicitors at AVANTCORE in answering your questions regarding your product positioning.