UNPA’s Israelsen on proposed mandatory product listing, supply chain issues, and China
Mandatory product listing (MPL) has been a central tenet of FDA’s plans to modernize the 27 year-old Dietary Supplement Health and Education Act (DSHEA) since it was mooted in 2019 by then-Commissioner of the FDA Dr Scott Gottlieb. The idea was already being discussed by some heavyweight stakeholders prior to 2019, with, for example, Scott Bass from Sidley Austin supporting a listing in 2018. Former Senator Orrin Hatch has also said it “makes sense.”
Speaking with NutraIngredients-USA at the recent SupplySide West show in Las Vegas, UNPA’s Israelsen said that draft bills are floating around Congress that are focused on mandatory product listing.
“The details are what matter here,” he told us. “How much do you share with FDA? How often do you do that? To what degree can information be held back as confidential? What level of confidence have you got in that system?
“There are some who are concerned that this may be used for more than just a look on the market, that it would have compliance implications, and I would tend to agree,” added Israelsen. “If FDA has the tools and that sort of information about products, they could use that to determine who has an NDI, who has not filed but maybe should have, they could use that for import purposes, there’s a range of things. Claims, as well.”
Given how divided this Congress is, and how tight the timetable is, Israelsen said it is difficult to predict if any progress will be made on these draft bills.
The supply chain issues
Israelsen also spoke about the challenges that many companies are facing with massive disruption to the global supply chain. UNPA sounded an alarm on potential supply chain issues early in the pandemic.
“I think a lot of companies got the message [of potential disruption] early on, but the problem was if you had the resource, the capital to buy the inventory at that time,” he said. “And that was the big difference: if you had deep pockets and you could forward buy and hold that cash, you were in a far better position.
“Those that knew it was coming and couldn’t do much about it, they knew they were going to head into a big storm and they surely did.”
One area that is impacting all consumer industries is the shipping costs. Israelsen said the cost of the raw materials themselves will impact how much of these costs are passed on to consumers. “Expensive raw materials not so much because that big increase in container cost can be absorbed. If it’s the lower cost materials, that’s where you really see a problem. You’ll see that in the general consumer retail goods market. Things like $15 shoes or low-end items, that container cost is going to make a significant difference.”
While the cost of containers is one problem, added Israelsen, and just getting a container is one thing, but then can you get it onto a ship because the ships are all in the wrong places. Once you get to port, ships can sit for two weeks or more waiting to get in, and then once in are there the crane operators and trucks to take the container away?
“The answer is time,” he said. “It’s going to take time to unwind all of this. Labor shortages is another factor, and COVID resurgence would be the other one. So, we’ve got three wild cards, and I’ve never seen anything like this.”
Israelsen also discussed UNPA’s extensive work in China. The organization has a partnership with Eurofins to identify and qualify Chinese ingredient suppliers to meet US GMP and FSMA standards, he said, which UNPA is calling its CIQI program: China Ingredient Quality Initiative.
“China represents 70-plus percent of raw materials, but how do we really know and ensure that the quality of goods is to standard? There are a lot of very good manufacturers in China. There are a lot more that we don’t know,” he said.
UNPA wants to identify those companies that want to achieve US GMP quality standards for two reasons, he said. Firstly, it produces a better product leaving China to come to the US, which will represent a significant change to how things have been done. Secondly, good made in the US using those qualified Chinese products will have a green channel entry back into the Chinese cross-border ecommerce market. All of this will help US companies develop a much safer export channel back into China, said Israelsen.
Watch the video above for more details