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New Regulatory Sheriff in Town

There was a day when the only main regulatory concern for the dietary supplement industry was the FDA. Mel Gibson, many years ago, warned and protected us from the prying fingers of the FDA and then DSHEA was passed and the FDA regulatory battlefield became somewhat more defined.

Fast forward over two decades and the regulatory concern is more broad. In addition to the FDA there is now oversight from FTC, Class Action Attorneys, Attorneys General, Brand Owners, Truth In Advertising, NAD, Investors, SEC and more. A new entrant into the list is emerging, e-commerce providers like PayPal and Amazon.

Two examples of this new oversight have become considerably troubling to internet sellers as the process is referenced by the ecommerce retailers as “guilty until proven innocent”. PayPal and Amazon are beginning to flex their muscles by refusing or discontinuing service when they believe the retailers product is not in compliance.

In much of the retail world, a product would be offered and vetted prior to offering for sale. Experts like Dr. David Morrison, Vice President of Scientific and Regulatory Affairs at The Vitamin Shoppe, Inc., Dr. Michael Lelah, Chief Research Scientist at Mercola and Aaron Secrist, Vice President Quality & Regulatory, NOW Foods are effectively trained gatekeepers ensuring compliance of products offered by the retail giants. Having presented both ingredients and brands to people like Dr. Morrison, Dr. Lelah and Mr. Secrist, I always felt relief, assurance and satisfaction when the product was approved. Vetting was never easy, but their process and dedication to compliance was comforting.

In the world of internet retail, the product is offered for sale and it is only after that point that vetting occurs. PayPal recently shut down payment portals on entire sites where it found product containing ingredients not approved in foreign countries accessible to international customers via US based websites. When PayPal discovered the infraction, all funds currently in process were held and future payments by consumers were denied. The retailer was then notified of the issue and a lengthy appeal process ensued. Complaints of disruption of commerce were referred to the PayPal Acceptable Use Policy Agreement approved at sign up.

In other cases, many retailers have no choice but to deny international sales in total as their ability to monitor the regulatory environment for individual ingredients to individual countries is beyond the scope of most retailers. (The full content of the PayPal Acceptable Use Policy: PayPal Acceptable Use Policy.)

Another example of a new regulatory sheriff is Amazon. Again, the vetting process occurs after a product is in commerce. After Amazon determines an infraction has occurred the product is delisted, and the retailer is subsequently advised:

This product has been identified as a dietary supplement that does not meet Food and Drug Administration (FDA) labeling requirements. Amazon policy prohibits products marketed to U.S. consumers that are FDA regulated products, such as cosmetics, drugs, or dietary supplements, that do not meet FDA labeling requirements. For more information, please see our Dietary Supplements Seller Help Page: Amazon Customer Help Page

No additional information is initially provided, and the retailer has the eventual ability to appeal or correct the decision after the fault is identified. Countless transactions can be lost during this process.

Amazon provides a detailed listing of infractions associated with Dietary Supplements: Amazon Seller Central Dietary Supplements. Among the reasons for delisting are FDA infractions:

  • Products that have been the subject of a prior regulatory action, such as:
    • Food and Drug Administration (FDA) warning letters, safety alerts, or recalls.

However, in one specific example, an FDA Warning Letter dated March 2018, citing specific products has not resulted in the products being delisted by Amazon. Obviously, more enforcement should be expected.

For assistance in vetting labels, the FDA provides a guideline: FDA Dietary Supplement Labeling Guide. Many consultants, including ITC, are also available to assist in this endeavor.

The takeaway here is that dietary supplement brands and retailers need to be extra vigilant in regulatory review to avoid risk of delisting or removal from services. No longer is it safe to “hope for the best” and believe in the favorable odds that the FDA will not come to your door. Many more eyes are watching now so it’s more important than ever to keep your eyes wide open.