Breadth of Vitamin Shoppe's Oregon settlement seen as troubling precedent

By Hank Schultz contact

- Last updated on GMT

Breadth of Vitamin Shoppe's Oregon settlement seen as troubling precedent

Related tags: Vitamin shoppe, Dietary supplement

The agreement between Vitamin Shoppe and the Oregon Attorney General sets a bad precedent for industry in several ways, experts say.

The dietary supplement retailer had been sued by Oregon AG Ellen Rosenblum over the sale of products containing DMAA, picamilon and several other ingredients. The basis of the suit was that these ingredients had already been the subject of regulatory actions by the Food and Drug Administration, something that according to the state made these “illegal or unsafe ingredients.”

Vitamin Shoppe agreed to pay a $545,000 fine and to cease selling any dietary supplement after FDA has issued written notice that the product contains an ingredient that is unlawful or unsafe.  In addition, Vitamin Shoppe may not sell DMAA, picamilon, and other unlawful ingredients in Oregon.

The nutritional supplements that Vitamin Shoppe was selling have the potential to do a lot of harm. Continuing to sell a purported dietary supplement after the FDA warned it was unsafe or unlawful is unacceptable,​ Rosenblum said. This is the first agreement of its kind that holds a retailer financially responsible for selling products manufactured by a third party that they knew or should have known were not safe or not lawful."

Unforeseen consequences

Experts contacted by NutraIngredients-USA said that while the settlement is small potatoes in dollar terms, it is surprising in its breadth, something that could have unforeseen consequences down the road for other companies.  For example, Vitamin Shoppe has agreed to be bound by actions FDA has taken against other companies in the form of warning letters.  If an ingredient is singled out in such a letter, Vitamin Shoppe has agreed to immediately cease selling products containing that ingredient in Oregon.  Also, the retailer agreed to be similarly bound by regulatory actions taken in other countries.

Under the terms of the settlement, if the FDA, or any other governmental entity in the U.S., Britain, Canada, the European Union or Australia brings the safety or legality of a dietary supplement sold by Vitamin Shoppe into question, Vitamin Shoppe must conduct an independent investigation to confirm whether the product is safe,​ according to a statement from the Oregon AG’s office. 

Some of that might fall into the realm of common sense.  After all, if for example Australia’s Therapeutic Goods Administration rules that an ingredient is unsafe, many companies might revisit the use of that ingredient in products sold in other jurisdictions to see if those regulators really have a point, or if they are overreaching.  But for Redondo Beach, CA-based attorney Erica Stump, who represents dietary supplement manufacturers, the precedent set by the agreement seems to lay waste to the concept of due process of law.  Stump said that the agreement could give more teeth to the concept of regulation by warning letter.

It was interesting to see that the agreement states that Vitamin Shoppe has to amend their purchasing agreements. What right do they have to dictate language to be put into their agreements?” ​Stump told NutraIngredients-USA. FDAs position seems to be, we sent out warning letters to companies A, B and C and we expect companies X, Y and Z to comply with those. Where is the due process of law in that?  This agreement further affirms that FDA can ignore due process.

Stump said, in her opinion, the agreement will have the effect of further constraining industry in its dealings with regulators and could be another example of regulatory creep.  She cited the way in which the Iovate settlement with the Federal Trade Commission more or less set into stone for the rest of the industry that two randomized, placebo-controlled trials would be needed to support a health claim.  While FTC had said publicly that consent decrees like the one with Iovate (and a subsequent one with Nestlé) applied only to those companies, it had a chilling effect throughout the industry that lasted until a court decision in 2015 on a case involving supplement manufacturer Hi-Tech Pharmaceuticals (full disclose: Stump represents Hi-Tech).

Those consent decrees become law, essentially, unless you have someone like Hi Tech with the financial wherewithal to challenge it,” ​she said.

For other companies operating in Oregon, will they have to amend their purchasing agreements? Technically no, but if you extrapolate, the answer might be yes,” ​Stump said.

Pre-empting the states

Dan Fabricant, PhD, president and executive director of the Natural Products Association said that Vitamin Shoppe (which is an NPA member) must have had a valid reason for agreeing to the settlement.  But he said there are cases were once a step is taken, and a liberty granted to an enforcement agencies, those situations can become hard to constrain.

The initial reaction seems like it is not that big a price tag, but when you look at all the riders it demonstrates there is going to have to be a lot of correspondence between folks. Well have to see what this will mean for future negotiations,” ​Fabricant said.

What it really says is that we have to start the discussion about pre-empting the states.  Are states the experts on the regulatory standards and the science?  Or is it the FDA?​ he said.

Related topics: Regulation

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