ABC leads effort to make sure rejected raw material is destroyed, not resold

By Hank Schultz

12-Oct-2017 - Last updated on 12-Oct-2017 at 19:45 GMT

The American Botanical Council has announced a plan to create an industry-accepted practice to ensure that rejected raw materials don’t find their way back into the market and onto the shelf in the form of finished goods.

Mark Blumenthal, founder and executive director of ABC, unveiled the plan at an industry event yesterday in Boulder, CO. The event, called the Rocky Mountain Dietary Supplement Forum, was put on by FDA Compliance Group, a Colorado-based consulting firm.

Dirty little secret: Substandard material never goes away

Blumenthal told attendees that as matters stand raw materials that are rejected are in almost all cases returned to the broker or ingredient supplier. These materials might be rejected for a number of reasons having to do with specifications, such as having too much heavy metals, having pesticide residues or failing microbial contamination tests.

Or in some cases raw material might be rejected because it is adulterated in some way. Adulteration might be in the form of undeclared plant parts from the same species, such as having leaves in extract that was supposed to be made from the root only. It might take the form of finding material from another species altogether. Or it might be the inclusion of exogenous chemicals, such as added elegiac acid to make the extract look more potent than it actually is.

Whatever the reason for the rejection, Blumenthal said the standard practice today is for the receiver of the goods to reject the lot, get a refund from the supplier, and wash their hands of the affair. The rejected material won’t appear in their finished products; if someone else chooses to accept it, well, that’s their business.

“That’s what’s happening. We all know it. Rejected material says in the supply chain,” Blumenthal said.

SOP for destruction of rejected material

Blumenthal said ABC is leading a coalition of partners that is creating a Standard Operating Procedure for the destruction of these materials. The SOP would put into place a contractual understanding between the supplier and the receiver of the goods that if the material is rejected for a number of specified reasons, the lot will be destroyed and the supplier won’t get their money back.

“We want to have a way for companies to say to their suppliers, if we find adulterated, illegal ingredients, we are going to destroy the lot and you are going to pay for it. That is the cost of doing business with us,” Blumenthal said. “This material should never have been shipped the first time; we want to make sure it doesn’t get shipped a second time.”

Virgin regulatory territory

Blumenthal said the effort enters virgin territory. The coalition includes several law firms doing pro bono work to come up with ironclad boilerplate language that can be used in supply contracts. A key part of the program would be an agreement for third party verification of the tests and especially of the destruction, to make sure an unscrupulous buyer couldn’t claim that a lot had to be destroyed and then pass it on to someone else on the sly.

“We looked for precedents and we found there really is no good regulatory guidance on the destruction of dietary ingredients. We want to protect both the buyers and the sellers,” he said.

Blumenthal said getting industry buy-in is the first step. A second phase would include getting the agreement from major retailers that these kind of supply arrangements would be part of their requirements for stocking products. It all adds up to being able to make a stronger case for a responsible, self regulating, transparent industry.

“There are lots of barrels full of good apples. There are many responsible companies in this business. The problem is, how can you tell who is who?” he said.