DIVESTING THE FDA
I Spoke in NYC on November 13, 2013
Memorandum from Ralph Fucetola JD
November 17, 2013
To: Potential Natural Product Company Investors
This Memorandum is to acquaint you with the benefits to your Company raising sufficient capital to comply fully with FDA/FTC SOP/ GMP & Clinical Study Guidelines.
Good Studies lead to good claims.
Good claims lead to increased ROI!
Properly Structured Standard Operating Procedures and
Trained Employees lead to significant regulatory savings.
Getting Ready for the FDA & FTC -- www.VitaminIndustryCompliance.com
Even more evidence that the agencies are serious about nutrient & natural product claims; this from the Natural Products Association in March 2011:
What does that mean? It means your Company reputation can be ruined by willful false posters; it means the govt will be trolling the site to find companies to harass…
And consider these “data points” from the last two editions of my Vitamin Lawyer Update eMemo: the UK advertising agency, the ASA now states, according to WINSH.org, “research on the ingredients was not the same as research on the product itself…”
Let’s repeat the key phrase: “…research on the ingredients was not the same as research on the product itself…” – and “research on the product itself” means a Clinical Trial, of course! The substantiation generated by the Clinical Trial is the legal basis for making product claims.
The Natural Products Association (NPA) said in February ‘11 – “Time's Up: FDA has begun real enforcement of dietary supplement GMPs. Companies of all sizes are being inspected. Are you ready?”
Is your Company ready? What does it take to be ready? See Below.
The above Red Letter warnings from the NPA & ASA urgently restate what I’ve been telling my perceptive clients regarding the vitamin or natural products companies. Are you ready for the FDA inspectors? Below are the 4 essential steps you must take with estimates of the investments these essential steps require from your Company. You need to budget this investment now and start to do what you can to be prepared; in this way you will outperform the competition who will not be so prepared.
HHS Secretary Sibelius admitted a couple years ago that she has a $16 Billion slush fund under Obamacare that can be used to fund activities like the FDA’s 4,000 new inspectors… and FDA has already dramatically increased inspections, without those new bureaucrats! SOP Certification Training is what your company needs.
Says FDA - "...documentation of employee training is necessary to track which employees have been trained in which operations. Therefore, final Sec. 111.14(b)(2) requires you to keep documentation of training, including the date of the training, the type of training, and the person(s) trained."
Federal Register, page 34811
What do you need to survive an FDA inspection? Go here:
1. Standard Operating Procedures – in place and up-to-date. GMP compliant detailed SOP documentation not only satisfies FDA & FTC, but also helps you organize your business!
2. Product Substantiation Notebook – in place and up-to-date; this Notebook is a MUST if you get inspected! The Notebook should includs copies of the Structure and Function Claims Notices companies are required to file with the FDA within 30 days of marketing any claim.
3. Your ROI can be strongly enhanced by copy-writers who know how to avoid Red Flag claims & Illegal Testimonials!
4. A Third-Party Clinical Trial of your product; you can no longer fully rely on published science about isolated ingredients.
The Dietary Supplement and Natural Remedies market is at a unique moment in its recent history.
The market has grown from under a billion dollars when the Dietary Supplement Health and Education Act (DSHEA) passed in 1994 (the first law allowing claims to be made for such products) to about $50 billion in 2009. The current recession is only having a marginal effect on the nutrient market and one survey shows that 51% of the purchasers would cut back on food purchases rather than vitamin purchases. At the same time, significant regulatory initiatives have occurred during the past years with potential impact on the market. After 14 years, FDA finally issued Good Manufacturing Practice (GMP) regulations for the industry during June, 2007 which became completely effective in June 2009.
All of these factors contribute to a growing industry that typically sees, after initial investment, a cost of goods, for start-ups, at about 20 to 25% of retail, rapidly moving down to 10% as new companies are able to order product runs in the hundreds of thousands of capsules.
Bottom line: savvy investors, seeking reasonably assured ROI, will find in the natural products market potential opportunity, if the Company invests in in Regulatory Compliance!