Consumer Affairs Agency vs. Daiko Pharmaceutical: The Eight-Year War over “CleverineConsumer Affairs Agency vs. Taiko Pharmaceutical: The Eight-Year War over Cleverin took a big leap with the Corona Pandemic and Government’s Medal with Dark Blue Ribbon Award

On April 15, the Consumer Affairs Agency issued a cease and desist order to Taiko Pharmaceutical Co. for Cleverin air sanitizer as “removing airborne viruses and bacteria,” claiming that the labeling has no reasonable effect and is in violation of the Act Against Unjustifiable Premiums and Misleading Representations. This was in response to the Tokyo High Court’s judgment against Taiko Pharmaceutical on January 13. However, some in the industry are wondering if Taiko Pharmaceutical will file an appeal.

Taiko Pharmaceutical is probably best known for its “Seirogan,” a gastrointestinal drug with a trumpet logo. However, the company’s hidden flagship product is the “Cleverin” air sterilizer. A fierce battle is now raging between the Consumer Affairs Agency and Taiko Pharmaceutical over a reporter from the former company tells us the following.

Last November, the Consumer Affairs Agency granted Taiko Pharmaceutical an opportunity to explain its action order against the labeling of six Cleverin products (a stick type, a spray type, and a placeable type). In response, Taiko Pharmaceutical filed a lawsuit to stop the measure order. This is an unusual action for a manufacturer.

In January of this year, the Tokyo District Court ruled that while the effectiveness of two of Cleverin’s placeable products had been recognized, the effectiveness of the other four products could not be reasonably recognized. In response, both Taiko Pharmaceutical and the Consumer Affairs Agency appealed the decision.

 

The High Court’s decision was made on April 13. The high court ruled that there was no reasonable basis for claiming air sterilization not only for the four products, but also for the two products that were found to be effective at the district court. For Taiko Pharmaceutical, this is a major setback.

The dispute between Taiko Pharmaceutical and the Consumer Affairs Agency over air sterilizers began eight years ago. In 2014, the Consumer Affairs Agency issued a cease-and-desist order to 17 companies, including Taiko Pharmaceutical, claiming that there was no evidence to support their advertising that the space sterilizers they were selling could sterilize air. At that time, Taiko Pharmaceutical commented in response to media interviews that it would make every effort to ensure that there were no misunderstandings in its labeling.

Then came the outbreak of the new coronary disease. While the world was in a state of excitement over the need to sterilize people, sales of air sterilizers were growing rapidly. An official of a major pharmaceutical company said, “The market size of air sterilizers” has been growing rapidly.

The market for air sterilizers expanded greatly with the outbreak of the new corona epidemic. The market for placeable sanitizers was said to be on the order of 5 billion yen until fiscal year 2018, but in fiscal years 2019 and 2020, the market quickly grew to 10 billion yen. Among them, Cleverin accounts for about 80% of the market.

For Taiko Pharmaceutical, the Corona disaster was a major turning point.

“Since Taiko Pharmaceutical’s business related to Cleverin for the fiscal year ended December 31, 2020 was approximately 14 billion yen (compared to approximately 9.3 billion yen for the fiscal year ended February 28, 2018). This was a significant increase,” he said.

This is not all. In April 2020, the company donated 10,000 units of Cleverin to Osaka Prefecture. For this achievement, the company was awarded the “The Medal with Dark Blue Ribbon” by the government in July 2021. The Medal with Dark-Blue Ribbon is a medal given to a person or organization that has donated a large amount of private funds for the public good.

Taiko Pharmaceutical has made a big deal of the fact that it has been awarded the Medal with Dark Blue Ribbon on its website. It is thought that the endorsement of the Medal with Dark Blue Ribbon had a significant impact on sales of Cleverin.

However, as you can see, the dispute with the Consumer Affairs Agency was reignited last November, and on April 13, the High Court of Justice ruled in favor of the company.

 

We asked the Osaka Prefectural Health and Medical Care Department for an interview about the High Court’s ruling that Cleverin was “without reasonable grounds,” and they responded as follows.

The Osaka Prefectural Government, which was not a party to the trial, is not in a position to comment on the content of the ruling.

We also asked the General Affairs Division of the Bureau of Prizes and Awards, Cabinet Office, which is in charge of the Medal of Honor, for an interview, to which they replied, “We are not in a position to comment on the reasons for individual awards.”

We are not in a position to comment on the reasons for individual awards.

 

The company’s position is that it is not able to answer questions about its products, even though it has given its endorsement. A pharmaceutical company official said, “In fact, Taiko Pharmaceutical has been working on the Taiko product for some time now.

In fact, Taiko Pharmaceutical posted a loss of 9.5 billion yen for the fiscal year ended December 31, 2021. The main reason for this was that sales of Cleverin fell far short of the plan. If the high court ruling were to become final, it would be a major blow to the company’s image. It was a surprise that they even filed this lawsuit in the first place, but now the industry is saying, “Taiko Pharmaceutical may appeal the case and continue the fight.”

 

On April 25, we asked Taiko Pharmaceutical about the high court decision and its intention to appeal.

“We will consider our future response to this decision after carefully examining the details of the decision. (Whether or not we will appeal the decision) is something we cannot say at this time.”

The “eight-year war” may still be raging.