“Is my product actually a cosmetic?”
It’s one of the most common questions I hear from brand owners and NPD teams developing a new SKU – and it’s important to answer before the formula is finalised, the name is chosen or the label goes to print.
Get it wrong and it may mean rethinking the product concept, formula, name and marketing approach.
The line between cosmetics and therapeutic goods is not always obvious, and the TGA looks at the overall picture – not just one factor.
This guide gives you a practical framework to work out whether your product is a cosmetic or a therapeutic good, whether you’re developing something new or reviewing what you already sell.
In this article we’ll cover:
- How cosmetics and therapeutic goods are defined and regulated in Australia
- What products ‘at the interface’ are and the TGA’s Excluded Goods Determination
- The five areas the TGA looks at when classifying a product as a therapeutic good
- Where I’m seeing brands go wrong today
- The consequences of getting it wrong
- What to do instead
To work through how this applies to your own product, download the free cheat sheet.
What’s the difference between a cosmetic and therapeutic good in Australia?
Cosmetics are products that change how the body looks, feels or smells at a surface level. Therapeutic goods are generally products that treat a condition or affect how the body works. They’re defined under separate Acts and regulated by separate bodies – so working out which one your product falls into is the starting point.
A cosmetic is defined in section 9 of the Industrial Chemicals Act 2019 as a substance or preparation designed to be used on any external part of the body, or inside the mouth, to change its odour or appearance, cleanse it, keep it in good condition, perfume it or protect it.
In practical terms, cosmetic products generally have surface-level benefits related to how skin, hair, nails and lips look, feel or smell.
AICIS (the Australian Industrial Chemicals Introduction Scheme) regulates the definition of a cosmetic and the import and manufacture of ingredients used in cosmetic products, but it doesn’t decide whether a product is a cosmetic or a therapeutic good – that sits with the Therapeutic Goods Administration (TGA).
A therapeutic good is defined in the TGA’s Therapeutic Goods Act 1989 as a product for therapeutic use, which includes two key areas that are relevant to cosmetic products:
- Preventing, diagnosing, curing or alleviating a disease, ailment, injury or defect (including named skin conditions like eczema)
- Influencing, inhibiting or modifying a physiological process
In practical terms, therapeutic goods do something to the body beyond the surface – whether that’s treating a condition, changing how the body works, or going beyond how something looks, feels or smells.
Therapeutic goods must be listed or registered on the Australian Register of Therapeutic Goods (ARTG) before they can legally be supplied in Australia. There are also extra regulatory requirements that apply, including around permitted ingredients, claims, manufacturing standards and advertising, which add cost and complexity.
Although skincare and beauty products are either regulated as a cosmetic or a therapeutic good, some don’t fit neatly into either category.
Which products sit ‘at the interface’ of cosmetics and therapeutic goods?
Products ‘at the interface’ sit at the boundary between cosmetics and therapeutic goods. They may have features of both – where they may look like a cosmetic, but make claims, contain ingredients or have functions that could push it across the therapeutic line.
Some borderline products are covered in the TGA’s Therapeutic Goods (Excluded Goods) Determination 2018. The Excluded Goods Determination identifies certain types of products that would otherwise be therapeutic goods – but if they meet specific conditions, they’re treated as “excluded goods”, meaning they’re not regulated as therapeutic goods and can be sold as cosmetics.
The six categories of products covered are:
- Antibacterial products
- Anti-acne products
- Anti-dandruff products
- Oral hygiene products
- Anti-perspirant deodorants
- Secondary sunscreens (where sun protection is not the primary purpose of the product)
Each category has its own set of conditions listed in the Excluded Goods Determination, and if those conditions aren’t met, the product is regulated as a therapeutic good, not a cosmetic. For some product types like secondary sunscreens, the conditions are extensive, including SPF limits, testing, product formats and claims.
One thing a lot of brands don’t realise is that some products that would be classified as drugs overseas, e.g. anti-acne products, can legally be sold as cosmetics in Australia so long as they meet the conditions in the Excluded Goods Determination, such as making the right types of claims.
Whether a product is covered by the Excluded Goods Determination or not, the TGA doesn’t just look at one thing – so next we’ll take a look at what else they consider.
What makes a product a therapeutic good, not a cosmetic?
A product is a therapeutic good when it goes beyond a surface-level cosmetic effect – whether by treating a condition or affecting how the body works. In practice, there are five areas the TGA may consider when assessing whether a product crosses that line:
- Product category – what type of product it is
- Product intent – what it’s designed to do
- Ingredients – what’s in it, and what those ingredients are known for
- Claims – what’s being said about it, on the label and everywhere else
- Presentation – the overall impression the brand and product create
Each one is covered below.
Some factors can push a product over the line on their own – like a clearly therapeutic claim or a product category with no legitimate cosmetic pathway. Often though, it’s a combination of multiple factors that decides where a product sits. And importantly, the TGA looks at the overall picture and what a consumer would think.
Product category
The first step is checking whether the product type has a cosmetic pathway. Cosmetic product categories typically include:
- Facial skincare (moisturisers, serums, cleansers, toners)
- Haircare
- Perfume and body fragrance
- Colour makeup, including foundations and powders
- Bodycare
- Deodorants (non-antiperspirant)
- Lip products
- Shaving products
- Bath products and soaps
- Nail products (polish and adhesives)
- Hair and eyebrow dye, including henna
- Eyelash glue
- Face paint
- Temporary tattoos
- Cosmetic sunscreens (when they meet the requirements of the Excluded Goods Determination mentioned above)
If the type of product you’re developing doesn’t have a clear cosmetic pathway (see examples later in the article), it will be difficult to overcome that regardless of how it sits with the rest of the areas.
Product intent
What the product is designed to do – often called its ‘intended purpose’ in regulatory language – can push it across the line, even when it sits in a cosmetic category.
For cosmetic products:
- The effect is on how the skin looks, feels or smells
- It stays surface-level – on the skin, hair, nails, lips or inside the mouth
- Any change is temporary, not permanent
- The reason someone uses it is aesthetic or sensory, not to address a health concern
If the intended effect goes beyond that – influencing how the skin behaves at a biological level, addressing a medical condition or creating a permanent change to the body – the product is likely therapeutic.
Ingredients
Ingredients can push a product across the line even when the category, intent and claims all look cosmetic.
Three things to consider:
Mechanism of action. Cosmetic ingredients work on the surface of the skin. If an ingredient is intended to influence, inhibit or modify a physiological process, that points to a therapeutic mechanism that should be assessed carefully.
Ingredients with therapeutic associations. Some ingredients are recognised as therapeutic actives, even when used at low concentrations. Human-derived stem cells and exosomes are clear examples – the TGA classifies human cellular and tissue material as biologicals (a type of therapeutic good), not as cosmetic ingredients. This is different from plant-derived stem cells, which are widely used in cosmetics.
The Poisons Standard. The Standard for the Uniform Scheduling of Medicines and Poisons (the Poisons Standard, also known as SUSMP) schedules certain ingredients based on the risk they present. Some ingredients are prohibited in cosmetics entirely or may turn a product into an over-the-counter (OTC) medicine or prescription-only medicine.
Claims
Claims are the most visible signal of whether a product is positioned as a cosmetic or therapeutic good. They include anything said about the product – on the label, in the product name, on the website, in social media and anywhere else the product is described.
A product is on the cosmetic side if its claims describe how the product affects appearance, smell, cleansing, condition or protection of the skin, hair, nails, lips or mouth.
The moment a claim crosses into talking about preventing, curing or alleviating a disease, ailment, injury or defect – or influencing a physiological process – the product is likely to be considered a therapeutic good.
Two common ones to watch out for:
Named conditions. Claims about treating, preventing or managing named skin conditions like eczema, rosacea, psoriasis, acne or dermatitis.
Mechanism-of-action language. Claims that describe how a product works at a biological level, such as regenerating skin cells, stimulating collagen production, stimulating hair growth or repairing DNA.
Presentation
The TGA doesn’t just look at what a product says – it looks at the overall impression the product creates. This is what the TGA often refers to as the consumer’s “take-out message”, i.e. what the average consumer would understand from what is being presented to them.
Things that can contribute to a therapeutic impression:
- A brand narrative built around solving a health problem rather than a beauty one
- Disclaimers stating the product isn’t intended to treat a medical condition
- Clinical or medical packaging, imagery and language, including terms like “medical-grade” or “pharmaceutical-grade”
- Positioning alongside therapeutic goods (e.g. listed in pharmacy categories or sold next to medicines)
- Endorsements from medical professionals framed as treatment recommendations
One thing to be clear on – avoiding certain words isn’t enough on its own. The take-out message is shaped by what’s implied or left unsaid, not just the words on the page. A product can avoid naming a condition and still leave a customer expecting it treats one.
The question every brand should ask is:
“Looking at everything (packaging, claims, advertising), would my customers understand my product to have a cosmetic effect? Or would they expect a therapeutic benefit – something that treats a condition or changes how the body works?”
If you’re not sure, show it to someone who knows nothing about the product and ask what they think it does.
Where do brands go wrong?
Leaving it too late
Brands often don’t ask whether their product is a cosmetic until the labelling stage. By then the formula, name and brand story are already locked in.
Sometimes the fix is easy, like rewording a claim. Other times the product itself has to change, or the brand has to sell it as a therapeutic good instead.
Relying on AI for regulatory advice
AI can be useful for early research, but it shouldn’t be relied on for Australian regulatory advice. Generic AI answers may apply overseas rules or miss important Australian exceptions.
For example, an AI tool may tell you anti-acne products are a therapeutic good because they’re regulated as drugs in the US. In Australia, some anti-acne products can be sold as cosmetics if they meet the conditions in the Excluded Goods Determination, including the requirements around claims.
This means you might be too conservative with your claims, or not launch a product at all. Or worse, you’ll develop a product that can’t legally be sold as a cosmetic, just because an AI tool told you it was fine.
Chasing trends
Wellness products, such as lubricants and period care products, are growing in popularity. Brands see a gap in the market and read it as an opportunity, when it’s a sign the product either can’t legally be sold as a cosmetic here or has only a very limited cosmetic pathway that needs to be carefully considered.
If you haven’t seen a product like yours on the market in Australia, it’s worth asking why. Sometimes the answer is that it can’t be sold as a cosmetic, and no amount of careful wording changes that.
Recently I came across a period care brand that had just launched a cramp relief balm, without TGA listing, because they didn’t get the right advice before launching. There’s no way this would be classified as a cosmetic the way it’s presented, and the brand is carrying real regulatory risk.
Some brands know the product is borderline and go ahead anyway. That’s a commercial decision, but it leaves the business exposed to recall, regulatory action and reputation damage.
What happens if you get it wrong?
It depends on the product and the risk. A cosmetic making therapeutic claims is an illegal therapeutic good, and if the TGA becomes aware of it they may issue a warning notice directing you to change your packaging, update your website or stop making a claim. That means reprinting, reworking the site and holding stock you can’t sell in the meantime, or having to destroy it.
Penalties are possible for more serious cases, but a warning notice is the more likely outcome in the first instance. For a small to medium brand, that can still be enough to end the business. I’ve seen a number of wellness brands share closing-down posts on Instagram after receiving letters from the TGA saying their products were illegal therapeutic goods because they weren’t listed on the ARTG.
Brands often assume they’re too small to be noticed, but complaints frequently come from competitors, not just customers.
And just because other brands are selling a certain type of product as a cosmetic doesn’t mean it’s compliant.
What this means for you
The two key things for you to do at the start of product development are:
- Work out whether your product is a cosmetic before you brief a formulator
- If there’s any doubt at all whether your product is a cosmetic, e.g. a wellness product, sunscreen or other grey area product, get specialist advice from a cosmetic regulatory consultant rather than relying on an AI answer
Use the cheat sheet below as a starting point – it includes a checklist of questions against the five areas mentioned in this article.
Want the cheat sheet?
A one-page checklist to help you work out if your product can legally be sold as a cosmetic.
How we can help you
If you’re not sure whether your product is a cosmetic or a therapeutic good, we usually help with one of the following:
- Regulatory Risk Assessment – gives a clear position on whether the product is cosmetic or therapeutic, looking at the specific criteria relevant to the product. This is the right pathway for products like sunscreens and other more complex categories.
- Clarity Call – works through the product positioning (cosmetic vs therapeutic good) in a single conversation. This is the right pathway where the product is more straightforward.
If our assessment points to the product being a therapeutic good rather than a cosmetic, we can refer you to TGA regulatory consultants who can guide you through TGA listing and the other requirements that apply.
You can see all our regulatory consulting services here.
To explore working together, the first step is to complete a Compliance Project Brief.
Jen has worked with Australian and international skincare and beauty brands on regulatory compliance since 2018, drawing on a background in corporate risk and compliance and degrees in Business and Psychology. Jen speaks regularly on cosmetic regulation, including at the Australian Society of Cosmetic Chemists (ASCC), the New Zealand Society of Cosmetic Chemists (NZSCC), in-cosmetics Korea, and Monash University.
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