FTC takes actions against makers of weight-loss products

The Federal Trade Commission (FTC) announced enforcement actions against four companies the agency said used deceptive advertising claims to sell weight-loss products.   In total, the four companies - Sensa, L'Occitane, HCG Diet Direct and LeanSpa - have agreed to pay about $34 million for consumer redress. 

The FTC has also updated guidance for publisher and broadcasters on how to spot phony weight-loss claims when screening ads for publication.  “Gut Check: A Reference Guide for Media on Spotting False Weight-Loss Claims” describes seven weight loss claims that can’t be true and should prompt a “gut check” – a second look to make sure publishers are not running advertisements with claims known to be false.  The guide also contains advice on dealing with problematic areas like consumer testimonials and fine print disclosures.  The Gut Check guidance updates the Red Flag Bogus Weight-Loss Claims reference guide for media that the FTC first published in 2003.

Sensa sold a sprinkle-on food additive that promised users would lose weight without exercising.  Users paid about $60 for one-month supply of Sensa products, which were sold online and at retail chains that included Costco and GNC.  U.S. retail sales between 2008 and 2012 totaled more than $364 million, according to the FTC.  The FTC said Sensa used faulty science in its marketing to mislead consumers and ordered the company to return $26.6 million to consumers.  The case was filed against Sensa, its parent firm, and two individuals who was chief executive and co-owner of the company.

L'Occitane, which the FTC said had no evidence to back up the claim that its skin cream would slim down a person's body, will pay $450,000.  HCG Diet Direct, which marketed a human hormone for weight-loss treatments, will surrender about $7.3 million in assets.

The fourth company, LeanSpa, which marketed acai berry and colon cleanse supplements, was granted a suspended settlement from the FTC because the company's inability to pay.

Weight-loss products remain one of the FTC's top enforcement priorities.   Makers of weight-loss products should ensure that their product claims (including testimonials used) are truthful, not misleading and supported by scientific evidence.

Dannon fined for making health claims for its yogurt product

The Dannon Company will pay a $21 million fine and stop making exaggerated health claims for two very popular Dannon products under an agreement with the federal government and attorneys general from 39 states.

Dannon will stop claiming that one daily serving of Activia yogurt relieves irregularity and that its DanActive dairy drink helps people avoid catching colds or flu, the Federal Trade Commission announced on Wednesday.

"These types of misleading claims are enough to give consumers indigestion," says FTC Chairman Jon Leibowitz. "Companies like Dannon shouldn't exaggerate the strength of scientific support for their products."

The move signals a more aggressive federal watchdog roll over deceptive advertising practices by major marketers under the Obama administration

The FTC charged that Dannon's ads were deceptive because it did not have substantiation for its claims. The commission also charged that Dannon's claims that Activia and DanActive were clinically proven were false.

The FTC complaint and settlement can be downloaded from the FTC website at: http://www.ftc.gov/opa/2010/12/dannon.shtm. 

Here are some tips on substantiation of product claims: http://business.ftc.gov/documents/substantiation-science-compliance.

Latest regulatory trends from RAPS conference

There were several excellent speakers at the RPAS (Regulatory Affairs Professionals Society) annual conference in San Jose last week.  They represented regulatory professionals in the private and public sectors, both domestically and abroad.  Here are some of the take-away messages from the speakers:

• FDA is stepping up enforcement.  This shouldn't come as a surprise if you've been following the agency's enforcement actions lately.  In his speech to the food and dietary supplement industry, FDA's Chief Counsel Ralph S. Tyler stated that the agency has just began its enforcement efforts and that more are yet to come.  Among the areas of concern are the good manufacturing practices (GMP) regulations for dietary supplement products, as well as the notification requirements for new dietary ingredients.  The agency also intends to hold individual more accountable for violations, which would result in more criminal prosecutions of company executives and even employees.
• FTC is stepping up enforcement.  Similarly, the FTC is stepping up enforcement in the area of claim substantiation.  The FTC will be looking at scientific data more closely to determine whether they support claims made about a product.   Companies should pay more attention to testimonials, because according to the government, they are never substantiated. 
• Companies are very interested in the Chinese market, but are frustrated by the regulatory framework there.  Among the conference speakers were five officials from the Chinese State FDA (SFDA), who provided an overview of the medical device approval process in China.  This presentation was one of the popular ones at the conference, and the numbers and types of the questions asked at the end of the presentation showed many companies (large and small) are very interested in the Chinese market, and yet are frustrated with the lack of transparency in the approval process.  Here are some of the policies that can cause frustration:
• According to a SFDA official, if a foreign company manufactures a medical device in China, the company will have to export the finished product out of China.  However, if a Chinese company puts its own label on the same product, it will be able to sell the device in China.  This policy seems to have little to do with safety and efficacy.  
• Also according to the same official, a medical device imported into China will not receive SFDA approval if the device has not received market approval in the country of origin.  The message seemed to be: if this device is not good for your country, it's not good enough for China.
• Questions were asked about whether the SFDA would accept data from clinical trials done outside of the China.  The answer was as clear as water - generally no, but we will decide on a case by case basis, but if we decided you need to do more clinical trials, you need to conduct them in China.  
• Questions were asked about whether the SFDA would meet with companies to discuss their products before the companies submit their applications for approval of their products.  The answer was that the SFDA holds a "open forum" every Thursday during which anyone can participate in a Q&A session with the agency to discuss any regulatory issues.  According to the SFDA official, no appointment is required and people can participate by phone.  So much for confidentiality. 

I am still reviewing my notes and materials from the conference, and plan to blog about other interesting topics I ran across there.

FTC has no business regulating speech from the heart, says POM Wonderful

Last week, the Federal Trade Commission (FTC) charged POM Wonderful, the maker of a brand of pomegranate juice, with making unsubstantiated health claims about its products.

The federal agency said the juice and supplements firm made "false and unsubstantiated claims that their products will prevent or treat heart disease, prostate cancer, and erectile dysfunction."  The complaint says the company "violated federal law by making deceptive disease prevention and treatment claims" with ads in the New York Times and other publications and on the Internet.

In an editorial published by the LA Times, Michael Hiltzik takes a closer look at POM's reactions to the charge, as well as the scientific research, which was funded by the company, behind the health claims.

It is not surprising that the people at POM are outraged by the charge and content that the federal government is infringing on their right of free speech.

The most interesting part of the editorial is perhaps POM's assertion that the company owner's (Lynda Resnick) statements about the product should not be taken as an "advertisement" and that since they were made in an interview, they are none of the FTC's business.

According to POM, Resnick is "talking about what she personally believes with respect to the science that she's seen. ... Lynda's not a doctor, she's not offering scientific opinion; she's speaking ... as an individual from the heart about what she believes."

A company generally cannot have someone say something for the company that it cannot say under FTC or FDA regulations.   Like Mr. Hiltzik, I am interested in seeing whether POM Wonderful can make that argument stick with the FTC.