Oregon Attorney General Pursues Supplement Retailer GNC

In today’s regulatory climate, where FDA, FTC, state attorneys general, industry self-regulatory organizations, class action lawyers, and even individual U.S. Senators are leading a patchwork of crusades against dietary supplement companies, it is vital to keep up to date with the latest enforcement efforts and trends.  Every two weeks, we send out an email that gives a brief synopsis of enforcement actions in the dietary supplement space (we never share our subscription list, and you can opt out at any time at the bottom of each email). Staying apprised of enforcement trends in the industry, from FDA warning letters to FTC false advertising allegations, can help you to stay above the fray and off of the regulatory radar. Learning from others’ mistakes is cheaper than learning firsthand what kinds of practices and violations lead to enforcement.
Here are the recent enforcement actions taken against purportedly non-compliant dietary supplement companies, and the claims made against them:
GNC under attack from Oregon Attorney General
On October 22, Oregon Attorney General Ellen Rosenblum accused GNC of selling products that were labeled as dietary supplements but contained synthetic ingredients. Even worse, the AG alleges that internal documentation shows that an important GNC figure knew the ingredients were synthetic and should not be used in dietary supplements but decided to continue sales regardless. One of the synthetic ingredients in question is Picamilon- a Russian synthetic drug that is created by combining Niacin and GABA and is used to treat a plethora of ailments but predominately neurological conditions. GNC is also accused of selling the synthetic amphetamine-like chemical BMPEA. “The suit alleges more than 4,000 individual violations of Oregon’s Unlawful Trade Practices Act, including failing to disclose that products contained the chemicals and misrepresenting that the products were lawful dietary supplements.” Not only does the AG attack GNC but also FDA, FTC and the dietary supplement community as a whole. The AG claims that if FDA and FTC cannot regulate the community, Oregon will take the necessary steps to regulate it.


Massachusetts Legislation
H. 3471 is a proposed bill in the Massachusetts legislature that would ban the sale of weight loss and bodybuilding supplements to minors as well as force retailers to post conspicuous warnings about said supplements at check out. Additionally, the products could only be accessed by store personnel, most likely by placing the products behind the checkout counter. Retailers would face penalties for not complying with the bill such as: at least $100 for the first violation, $200 for a second and $300 for a third.

Bayer’s Victory Over FTC
Judge Linares of the U.S. District Court for the District of New Jersey issued a strong opinion in FTC’s contempt action against Bayer, finding that Bayer did not fail to substantiate its product’s structure/function claims simply because it didn’t rely on randomized, double-blind, placebo-controlled clinical trials. FTC alleged that Bayer violated a 2007 settlement regarding substantiating its claims about its dietary supplement products. Through expert testimony, FTC argued that Bayer could substantiate its claims only through “a randomized controlled trial . . . meeting 8 specific requirements: (1) randomized; (2) placebo-controlled; (3) double-blind; (4) human clinical trial; (5) done in the target population; (6) with the specific product at issue; (7) using appropriate statistical methods; and (8) designed with the desired outcome as the primary endpoint.” Judge Linares rejected FTC’s position, stressing the flexibility of the “competent and reliable scientific evidence” set forth by FTC regulations. “[FTC’s expert’s] opinion is contrary to the FTC Guidance.” “As two other courts have held, competent and reliable scientific evidence does not require drug-level clinical trials, and the Government cannot try to reinvent this standard through expert testimony.”

CMG in the News
For an October 22 Natural Products INSIDER piece, Collins, McDonald & Gann, P.C. partner, Richard D. Collins, spoke about the latest trend in sports nutrition compliance: cease-and-desist letters, followed by private litigation. Allegedly compliant supplement companies have begun sending cease-and-desist letters to allegedly noncompliant supplement companies. These letters essentially flag the alleged violations of the noncompliant supplement company. Seemingly, if the recipient of the letter does not cease its allegedly illegal practices, then the sender will file a lawsuit alleging various unfair competition causes of action, including Lanham Act violations. Until recently, noncompliance was addressed predominantly by FDA and FTC actions. As reported by Natural Products INSIDER, Rick Collins states: “I anticipate cease-and-desist letters becoming more common alleging Lanham Act violations or unfair trade practices in an effort to force competitors to clean up their act. . . . If this trend continues, I think it will have a profound effect on the market without FDA or FTC doing anything.”

If you have a dietary supplement company and have any questions about your responsibilities under the law, including label claims, labeling requirements, advertising review, Good Manufacturing Practices, or anything else, give us a call anytime at 516-294-0300.