A Bitter Pill To Swallow: Class Action Targets Sudafed And Codral’s Ineffective Ingredient

One of the largest class actions in New Zealand’s history has been filed in the Auckland High Court today against pharmaceutical giant Johnson & Johnson. The class action has been brought by boutique class action firm JGA Saddler who allege the company has marketed and sold ineffective medicines for around 20 years.

Popular brands including several varieties of Codral Cold & Flu and Sudafed PE - all owned by Johnson & Johnson - contain phenylephrine (or “PE”), a drug the company has marketed and sold as a nasal decongestant for decades.

Millions of New Zealanders expecting to be able to ‘soldier on with Codral’ and other cold and flu medicines may be shocked to learn the over-the-counter products’ key ingredient is ineffective when taken orally.

A growing body of evidence has caused the Food and Drug Administration (FDA) in the United States to propose an outright ban because it believes the drugs when taken orally, simply don’t work.

JGA Saddler director Rebecca Jancauskas said it was a case of Johnson & Johnson putting profit before people.

“Customers should be able to confidently buy medicines that work as advertised and when they don’t, the company involved should be held accountable,” Jancauskas said.

“Johnson & Johnson has manufactured and marketed a medication that decades of evidence have shown doesn’t work as claimed, relying on outdated, fallible studies to sell the New Zealand public products that don’t do what they say on the packet.

“New Zealanders have trusted these products to work as advertised and wouldn't have bought them if they knew they were ineffective at treating congestion.

“Johnson & Johnson has misled the public and they need to be held accountable for their actions. We are asking all New Zealanders who have purchased any of the 17 affected products to register to be a part of the class action.”

When the decongestant pseudoephedrine, which is effective when taken orally, was banned for sale in New Zealand between 2011 and 2024 over concerns it was being used in the manufacture of illicit drugs, phenylephrine was quickly marketed as a substitute.

“Large multinational companies with ample resources have no excuse for misleading consumers about the efficacy of their products," said Jon Duffy, Chief Executive of Consumer NZ.

"Consumers are especially vulnerable when they are unable to test product claims themselves and when it comes to products in the health space, it’s critical that consumers can rely on the claims manufacturers make.”

“Companies must be held to account if they are found to breach the Consumer Guarantees and Fair Trading Acts.”

Until it can be shown that these products are effective, Consumer NZ recommends consumers stop using them and encourages anyone impacted to join the class action.

“We’re also calling for sales of these products to be halted until the efficacy of the claims can be independently verified.”

A class action is a special type of court claim which enables a number of people who have suffered a similar harm to collectively pursue one claim together in a cost effective and efficient manner.

“We expect this will be the largest class action in New Zealand history in terms of the number of affected individuals,” Jancauskas said.

This case is backed by global litigation funder Omni Bridgeway, which has been funding class actions in New Zealand and Australia for many years. The claim is being run on a “no win no fee” basis which means there are no upfront costs for those involved in the claim. Omni Bridgeway’s New Zealand Investment Manager Jacob Kerkin said it was important companies like Johnson & Johnson are held to account when they breach the law.

“For around 20 years, New Zealanders have been sold cold and flu products to relieve their symptoms, despite studies and scientific evidence showing their key ingredient phenylephrine is ineffective when taken orally,” Kerkin said. “Kiwis deserve better.”

JGA Saddler is urging all New Zealanders who have purchased one or more of the below affected products of Johnson & Johnson branded oral cold and flu medicines during the period of 2005 to 2025 to register their claim at www.coldandfluclassaction.co.nz.

New Zealand consumers who have purchased any of the following 17 products are encouraged to register:

• Sudafed PE Nasal Decongestant Tablet
• Sudafed PE Sinus + Pain Relief Day & Night Tablet
• Sudafed PE Sinus + Pain Relief Tablet
• Sudafed PE Sinus + Allergy & Pain Relief
• Sudafed PE Sinus + Anti-inflammatory Pain Relief Tablet
• Codral Cold & Flu + Mucus Cough Capsule
• Codral Decongestant Tablet
• Codral Day & Night Tablet
• Codral Cold & Flu Tablet
• Codral Night Tablet
• Codral Mucus Cough + Cold Liquid
• Codral Cold & Flu + Mucus Cough Powder
• Codral Cold & Flu Powder
• Benadryl PE Chesty Cough & Nasal Congestion Syrup
• Codral Cold & Flu Sore Throat Tablet
• Day & Night Cold & Flu + Cough Combination Tablet
• Benadryl Mucus Relief Plus Decongestant Liquid

About JGA Saddler

JGA Saddler specialises in large and complex litigation, with a focus on class actions. Collectively the boutique class action firm’s founders have over 80 years’ of litigation experience, 60 of which they specialised in class actions, and have secured more than AU$1.3 billion in class action settlements and judgments. JGA Saddler has offices in New Zealand and Australia.

Factsheet

1. What is phenylephrine?

Phenylephrine is a commonly used ingredient in cold and flu medications as a nasal and sinus decongestant. It is present in several on-the-shelf cold and flu medications in New Zealand, including Johnson & Johnson’s Codral and Sudafed-branded cold and flu medications.

Phenylephrine has been marketed as an effective substitute for pseudoephedrine. Pseudoephedrine-based cold and flu medication was banned in New Zealand in 2011 following concerns over its use in the manufacture of illicit drugs and could only be purchased via prescription.

In May 2024, pseudoephedrine-based cold and flu medications became available for over-the-counter purchase without the need for a prescription (but a consultation with a pharmacist is required).

Despite the ban reversal, products containing phenylephrine continue to be marketed and sold in New Zealand but do not require a consultation with a pharmacist, meaning they remain a popular option for people seeking relief from symptoms.

2. How does phenylephrine work?

When inhaled as a nasal spray, phenylephrine effectively treats nasal congestion by making the blood vessels in the nose narrower, reducing blood supplied. However, a growing body of evidence has revealed that less than 1% of phenylephrine is absorbed when taken orally, rendering its decongestant effects ineffective.

In November 2024, the U.S. Food and Drug Administration announced it is proposing to remove oral phenylephrine as an active ingredient in over-the-counter cold and flu medications.

3. What are the allegations against Johnson & Johnson?

Johnson & Johnson sells a range of oral cold and flu medications containing phenylephrine as an active ingredient, which are marketed as providing effective relief from cold and flu symptoms, despite a growing body of evidence to the contrary.

It is alleged that Johnson & Johnson has marketed and sold ineffective phenylephrine-based cold and flu medication to New Zealand consumers since 2005.

4. What Johnson & Johnson products contain phenylephrine?

There are currently 17 Johnson & Johnson branded oral cold and flu medications available for purchase in New Zealand that contain phenylephrine:

• Sudafed PE Nasal Decongestant Tablet
• Sudafed PE Sinus + Pain Relief Day & Night Tablet
• Sudafed PE Sinus + Pain Relief Tablet
• Sudafed PE Sinus + Allergy & Pain Relief
• Sudafed PE Sinus + Anti-inflammatory Pain Relief Tablet
• Codral Cold & Flu + Mucus Cough Capsule
• Codral Decongestant Tablet
• Codral Day & Night Tablet
• Codral Cold & Flu Tablet
• Codral Night Tablet
• Codral Mucus Cough + Cold Liquid
• Codral Cold & Flu + Mucus Cough Powder
• Codral Cold & Flu Powder
• Benadryl PE Chesty Cough & Nasal Congestion Syrup
• Codral Cold & Flu Sore Throat Tablet
• Day & Night Cold & Flu + Cough Combination Tablet
• Benadryl Mucus Relief Plus Decongestant Liquid

5. What is a class action?

A class action, also known as a representative action in New Zealand, is a special type of court proceeding which enables a group of people to collectively pursue a claim together.

A class action is typically brought by one person (the ‘representative plaintiff’) on their own behalf and on behalf of a class of people (known as ‘group members’) against another person (known as the ‘defendant’). Group members must have claims against the same respondent that are in respect of, or arise out of, the same, similar or related circumstances.

6. Who is Omni Bridgeway?

Omni Bridgeway Limited (‘Omni Bridgeway’) is a global litigation funder with offices around the world, including in New Zealand. Omni Bridgeway is listed on the ASX.

Omni Bridgeway is providing litigation funding for the fees and disbursements of law firm JGA Saddler Lawyers who are conducting the proceedings against Johnson & Johnson on behalf of the class in both Australia and New Zealand. It is also providing litigation management services during the class action.

7. Who is eligible to participate in the class action?

Anyone who has purchased one or more of the 17 Johnson & Johnson branded oral cold and flu medications listed in question between 2005 and 2025 is invited to register their claim with Omni Bridgeway.

8. Do applicants need a receipt of purchase to register for the class action?

No, applicants do not need proof-of-receipt to participate in the class action. If they have not kept their receipts, they will be required to sign a declaration to say they had purchased the product.

9. Does it cost to be part of the class action?

The class action is being funded by Omni Bridgeway on a “no win, no pay” basis in accordance with the terms of a funding agreement or terms imposed by the Court.

There are no costs involved for group members who wish to take part in the class action. Group members do not have to pay anything if the class action is unsuccessful, as Omni Bridgeway agrees to pay any legal costs that might be awarded to Johnson & Johnson or any other respondents.

10. What happens if the class action is successful?

If the class action is successfully resolved and there is a recovery of compensation, Omni Bridgeway will be entitled to reimbursement of the costs it has spent plus a commission from such recovery only. The rest of the compensation will be disbursed equally among the group members.

11. How can eligible New Zealanders apply to be part of the class action?

Anyone who has purchased one or more of the Codral, Sudafed or Benadryl cold and flu medications listed in question between 2005 and 2025 is invited to register their claim at www.coldandfluclassaction.co.nz.

12. How does this class action relate to similar actions in Australia and other countries?

The proceedings on foot in Australia have no bearing on the proceedings in New Zealand. These two cases will proceed through the usual interlocutory steps independently of each other.

There are also similar proceedings on foot in Canada and the US.

13. Are class actions common in New Zealand?

New Zealand doesn’t have an established class actions regime. Instead, we have ‘representative actions’ under the New Zealand High Court Rules.

In 2022 the Law Commission has recommended the creation of a formal class actions regime, which would be governed by a new "Class Actions Act". This proposed regime would allow for both opt-in and opt-out class actions and would include provisions for litigation funding.

While there have been no legislative changes since the report, key judicial decisions continue to develop the law around class actions and litigation funding.

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