Regulatory Update 2011

What lies ahead for natural products manufacturers and suppliers?

Written By:
Kaylynn Chiarello-Ebner
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Many regulatory changes are percolating in the natural products industry. Leaders from several industry associations and nonprofits offer some insight about what could be in store for companies in the near future.

Food Safety Modernization Act
The Food Safety Modernization Act was signed into law in January, and insiders believe it could strongly affect our industry. First off, Michael McGuffin, president of the American Herbal Products Association (AHPA), Silver Spring, MD, says there’s some language in the legislation that changes how often one would need to register with the U.S. Food and Drug Administration (FDA). Previously, registration with FDA was required once in life, and now the law requires registration every two years.  “It’s still free. It will still take 20 minutes,” McGuffin states. “It’s just tedium, that’s all.”

Importantly, the Act says FDA must produce a guidance document for new dietary ingredients (NDIs) within 180 days of the bill becoming law, which could be in early July. When it does come through, McGuffin says, “I can’t imagine an NDI guidance would change the law…But, I won’t be surprised to see some interpretation from FDA.”

Douglas “Duffy” MacKay, N.D., vice president of scientific and regulatory affairs for the Council for Responsible Nutrition, Washington, D.C., also is concerned about what such a document could mean for dietary supplement manufacturers. “We’re all waiting to see how FDA interprets the NDI notification process…there are some gray areas or open areas for interpretation.” For instance, ingredients that were grandfathered in because they were sold before 1994 do not need to go through the NDI process. There’s no agreed-upon list of such ingredients. So, in a new NDI process, it’s not clear what substantiation could be required to prove that a product was on the market before 1994.

MacKay also raises the issue of what would happen if a botanical was on the market before this time, but is extracted with a new technology. States MacKay, “We may find that the FDA document will say certain chemical alterations or extraction methods make it a new dietary ingredient. We may run into the issues of having ingredients on the market that would require retroactive certification.”

The problem could snowball from here. MacKay says it’s possible that the agency would be flooded with NDI applications, and not have the resources to go through everything in a timely manner or even enforce such regulations. “This is something that has the potential to really affect the industry,” he states. “The question is what is new and what isn’t? If the definition of ‘new’ is very broad, then companies are going to have a lot of work to do to submit their NDIs.”

The biggest effect the law may have on natural businesses, McGuffin believes, could be the requirement of food manufacturers to develop Hazard Analysis and Critical Control Points (HACCP) practices in their facilities. Supplement manufacturers were exempted because the good manufacturing practices (GMPs) requirements they must abide by are so stringent. “We’re not seeing a lot of food hazards as a class in our category, so they exempted dietary supplements manufacturers,” he states. “But, they didn’t exempt ingredient suppliers.” Every ingredient company must now comply with HACCP, which will mean a lot more paperwork and increased manufacturing costs for some firms, McGuffin feels.

MacKay highlights another section of the bill that deals with protection against intentional adulteration. “This is really about food and they’re really looking at economically motivated adulteration,” he explains. The bill indicates vulnerability assessments will be conducted and regulations be issued to protect against the intentional adulteration of food. “We don’t know what areas they’ll define as vulnerable, but there is the possibility that the categories highlighted by former FDA official Joshua Sharfstein, M.D., in his announcement to the industry could potentially make the list of possible vulnerable areas and regulations may be put into place to address them,” MacKay predicts. Such categories could include weight loss, sexual enhancement and body building.

McGuffin also notes that the new act gives FDA some additional recall authority and the ability to collect fees for reinspection. “That’s one we’re a little concerned about,” he says. The new law says FDA can charge companies if they come back to follow-up on problems—even minor ones—uncovered during inspections. Theoretically, they could bill you for everything from car mileage to overhead cost. “They left it up to FDA to determine the cost,” McGuffin says. “We are curious to see if they will start submitting invoices for inspections that happen, say, 20 years after the first inspection. Is the first one the original inspection and then all others reinspections? We hope not. We don’t think that’s what Congress intended.”

Funding Issues
Some of the ways the Food Safety Modernization Act could affect our industry are dependent on FDA having appropriate monetary resources. At press time, John Gay, executive director and CEO of the Natural Products Association, Washington, D.C., told WholeFoods that “Congress is on the verge of a potential government shutdown.” The last Congress only funded the government through March 4 with a continuing resolution. “The current House Republicans have passed a continuing resolution that doesn’t just extend current funding levels through the end of the year, but makes significant cuts in discretionary spending—which includes FDA,” Gay explains. Though there aren’t specifics about how the budget cuts will affect its dietary supplements programs, “it’s a significant cut to FDA,” he says. Gay also notes that the Senate is “less than thrilled” with this document and is working on its own continuing resolution.

At the same time, President Barack Obama released a budget for fiscal year 2012 that would increase FDA funding 33% over fiscal year 2010. “A big chunk—over $300 million of that budget request—is new money to implement the Food Safety Bill,” Gay says. “So, you’ve got a big difference between what the House would like to spend and what the President would like to spend.” Will that delay the NDI guidance? Will there be fewer GMP facility inspections in the future? Only time will tell.

Given that the Congress holds the purse strings for these key areas, Gay believes that it’s important to contact legislators such as on NPA’s Lobby Day to discuss issues like these that could affect the natural products industry.

Establishing DRIs for DHA
In 2009, the Global Organization for EPA and DHA Omega-3s (GOED), Salt Lake City, UT, and 10 other organizations submitted a citizen’s petition to the Food and Nutrition Board of the Institute of Medicine (IOM) asking for a panel to review the data on the health benefits of omega-3s. How close are we to getting the IOM to establish some standardized dietary reference intakes for EPA and DHA? “That’s the $64,000 question,” says Harry Rice, Ph.D., vice president of regulatory and scientific affairs at GOED, who hopes that this petition will rise to the top of the pile of IOM’s to-do list now that the vitamin D review is out.

Rice says GOED intends to approach IOM about the EPA/DHA petition. “It’s not clear whether they’re going to choose another nutrient to review. But, we believe DHA/EPA will be reviewed in the near term…I think it depends partly on the budgeting process,” he explains.

Right now, the IOM is reviewing the review process itself, and Rice speculates that DHA/EPA may be up against choline for the next review slot. He expressed confidence that the research behind EPA/DHA is compelling enough for it to be chosen. Once DHA/EPA is in review, it will take about two years before a report is issued.  “If we were asked to make a recommendation—and we are not a recommending organization—we believe the science points to a minimum of 250 mg/day to 500 mg/day combined for the general population. Greater amounts could be used for different populations,” states Rice.

Health Claims and the FTC
Over the past one to two years, the Federal Trade Commission (FTC) has sent out a slew of warning letters opposing the health claims made in several dietary supplements advertising campaigns. Some blame a murky (and sometimes changing) explanation of what research is sufficient to make a health claim in the eyes of FTC.

States Rice, “Messages have been very mixed about what makes an acceptable health claim. They’ve gone on record with more than one criteria.”

For instance, the FTC has indicated that two human studies are sufficient to support a claim, and other times, it won’t specify how many studies are adequate, saying that it must be evaluated on a case-by-case basis.

Will we see something to cement exactly what makes a suitable claim any time soon? Unfortunately, it doesn’t look like it, even though many believe such a definitive guidance document would be extremely helpful.

Similarly, many believe it would helpful if FDA offered better explanations about claims, too. “I think some structure–function claims guidance from FDA would be beneficial. All of the enforcement isn’t doing enough. Unless companies get additional guidance, they’re not going to know what to do,” says Rice.

On a related front, MacKay notes that the FTC recently asked some companies to sign consent decrees saying they can’t make future claims without first having two independent double-blind, placebo-controlled randomized trials and having pre-approval from FDA for any health claims. This is despite the fact that FTC doesn’t formally require such FDA pre-approval under the law. So far, two companies have been served this order, but “the industry is concerned that this is becoming a de facto standard,” says MacKay.

“Is this the start of a trend for FTC to require pharma-like substantiation from companies?” Gay asks. “Are they going to do it company by company and seek to make it a de facto standard, when it should not be the requirement for most…We want to make sure the FTC doesn’t take away the ability to do what DSHEA and FDA allow.”

Codex Standard for Marine Oils
An informal industry working group (that included GOED) was formed about two years ago to provide guidance to the Swiss delegation, which was submitting the first proposal to Codex for new work on marine oils. “This has been very interesting,” Rice states. “There’s been an incredible lack of consensus on what should constitute a viable standard. First, we started with just a fish oil standard, and then it migrated to encompass absolutely everything, making it a marine oil standard.”

Rice says it’s not clear how such a standard would be adopted or even what would be adopted, partly because the identity profile for fatty acids is so diverse. At the end of the day, he says, the question is whether the standard would be helpful or practical to adopt through Codex.

Codex met at the end of February in Malaysia. At the meeting, the Committee on Fats and Oils decided to advance a proposal for new work to establish a standard for the identity of marine oils.

Continued Attention to Drug Spiking
FDA has stated loud and clear that it’s trying to squeeze illegal, tainted products out of the legitimate dietary supplements industry. “We have been talking about it for years, and really want to see the problem go away,” says McGuffin. “The message is that FDA is paying better attention. We’ve seen a number of criminal cases brought in the past couple of months…it’s a quiet message to the good companies…but the louder message is to the criminals and that is that the regulator has stated that this is its priority.”

In the coming year, we may see continued attention from the agency in this area and some fairly quick action against offenders. 

GMPs Watch
Gay believes that FDA is doubling its GMPs inspections this year. “We are seeing an increase in activity based on the increased funding levels they have had for the past few years. Looking ahead for the rest of this year and next year, there’s a budget fight happening. How it will affect the dietary supplements industry remains to be seen.”

So far, about 100 companies have been visited under the GMPs for dietary supplements, so we can begin to draw some insight from what was recorded on Form 483s about what FDA is looking for. “We’re seeing patterns that are telling us what are FDA’s priorities for these inspections,” says MacKay. “That, I think, will shape best business practices like areas of supplier qualification.” Warning letters and inspection reports send a message to other companies for where they need to address their resources so as to pass their own inspection, he feels.

Gay adds that there are many resources available (like educational programs from many industry associations) for manufacturers that have questions about compliance. “Companies need to get up to speed about GMPs if they aren’t already,” he says.

USDA, Organic and GMOs
There has been a recent flurry of activity at the U.S. Department of Agriculture (USDA). In the past couple of years, USDA has hinted that it would continue to pay attention to organic non-conventional foods like personal care products. Some feel organic rules should be followed strictly and others believe in a more relaxed interpretation. “USDA has said they’re going to figure it out,” states McGuffin. He believes signs are pointing to USDA taking a fairly stringent approach to organic products. “I think that’s a pending regulation that will have some impact on anyone selling organic, including organic supplements,” he states.

In other news, the USDA recently deregulated some genetically modified organisms (GMOs); now GMO sugar beets, alfalfa and feed corn can be planted. “The concern is that as crops get deregulated to use GMOs and to plant GMO crops, the inadvertent contamination of organic crops then becomes an enormous problem for farms—which then becomes an enormous problem for retailers,” states Christine Bushway, executive director of the Organic Trade Association (OTA), Washington, D.C.

Since the principles of organic means that it must be free of GMOs, there could be a dangerous chain of events that could affect organic regulations. “There are strong scientific data that in a very short period of time—three to five years—organic crops will be tainted with GMO pollen,” McGuffin states. 

Adds Bushway, “If we don’t have those baseline farmers, then we can’t supply what the consumer is asking for. We see it as a huge affront to consumer choice…The farmer is the base of the organic industry.”

At this time, the only recourse for the industry, according to Bushway, may be litigation. She stated that such a lawsuit would not be raised by the OTA, but by others concerned about the threat to organic crops. Unfortunately, there may be upwards of 20 potential GMO crops that may be deregulated.

The last issue that could affect organic product makers in the near future are the enormous budget cuts at USDA due to the government’s financial woes, says Bushway. “We want to protect the National Organic Program, which is housed at the USDA, and some other programs like research programs for organic and Environmental Quality Incentives Programs (EQIP),” she says.

Bushway says, in particular, they want to ensure that the cost share program for small farmers doesn’t get cut. This money helps reimburse $750 toward organic certification costs. “Right now, there’s a lot of push to cut the cost share program, and that would be really a big problem for a lot of small organic producers because it’s a big help to them…we’re watching it very closely,” she states. WF

Published in WholeFoods Magazine, April 2011