In a ruling made at the end of last month, Glucorell and Anafit were ordered to pay $493,545, which equated to the sales generated from their deceptively marketed products.
FTC, which works together with FDA to regulate product advertising, said the two Orlando-based firms had made a number of unsubstantiated claims about their Glucorell R and Insulow products, and also falsely stated that some of these claims were backed by clinical evidence.
The complaint filed by FTC lists unsubstantiated claims including:
- prevention or reduction of the risk of developing Type 2 diabetes
- an effective treatment for Type 1 and Type 2 diabetes
- an effective in treating and preventing cancer
- lowering high blood sugar levels;
- preventing or reversing insulin resistance
- increasing fat loss and decreasing insulin-related obesity
- enabling diabetics to reduce or eliminate the amount of drugs and insulin required to keep blood sugar levels healthy and reduce insulin resistance
The Commission also alleged that the defendants falsely advertised that the majority of these claims had been proven by clinical studies.
How FTC regulates
In broad terms, the nation's Food and Drug Administration (FDA) regulates the use of health claims on product labels, while FTC handles claims made in product advertising. However, some overlap may occur when products are being investigated.
Michelle Rusk, from FTC's division of advertising practices told attendees at Expo West in Anaheim, California, earlier this year, that FTC enforcement priorities include: Health and safety; promises to treat/cure serious diseases; children ("Anything that makes dodgy claims about being good for kids"); outright false claims; and widespread or severe consumer injury.
She highlighted the following in relation to the agency's enforcement avenues and consequences:
- Administrative or Federal Court - with most of FTC's cases now going into Federal Court
- Broad liability - with anybody actively involved in the creation of advertising being liable
- Injunctions and asset freezes
- Suspended judgments
- Criminal liason unit - "Sometimes, civil law enforcement isn't adequate"
Slap on the wrist
Despite the half a million dollar fine incurred by Glucorell and Anafit in the current case, the two companies ultimately escaped payment.
FTC said the entire judgment was suspended due to the firms’ inability to pay the dues. If the companies are found to have submitted inaccurate financial information to the agency, then they will automatically be required to pay the fine in full, said FTC.
The order contains various record keeping provisions to assist the FTC in monitoring the defendants’ compliance.