Risk-based regulation has underpinned Australian prescription and non-prescription medicine regulation for over three decades. However, data consistently demonstrate high rates of non-compliance among non-prescription medicine sponsors, with most breaches a result of inappropriate labelling and advertising, a lack of evidence to substantiate therapeutic claims, and product formulation and manufacturing. This paper seeks to understand why the regime fails to achieve compliance from non-prescription medicine sponsors. Using a state–corporate harm lens, and Marxist and Foucauldian perspectives, it is argued that regulatory failure is the product of the regime’s congruence with neoliberal governmentality. This governmentality is inextricably linked to a neoliberal market hegemony that attempts to minimize forms of market intervention detrimental to the accumulation of capital.