Federal Sweep Nets 40 Criminal, Civil Cases For Spiked Supplements, Disease Claims

A deputy assistant attorney general clarifies that ongoing investigations target “unlawful makers and marketers of dietary supplements,” but DoJ and other agencies broadly warn the entire industry about the potential for additional criminal cases as well as civil complaints.

A Department of Justice 12-month enforcement sweep against “unlawful makers and marketers of dietary supplements” could satisfy calls from lawmakers and public health advocates for increased enforcement, but also reveals broad doubts about the industry from federal agencies.

“Dietary supplements are one of the most challenging areas that FDA regulates,” said Howard Sklamberg, deputy commissioner FDA for Global Regulatory Operations and Policy, during DoJ’s Nov. 17 media briefing about criminal charges and civil complaints against violative firms. The sweep, Sklamberg said, should “serve as notice to industry.”

The Federal Trade Commission also announced enforcement actions during the briefing, although FTC, without conducting briefings, regularly posts releases about complaints or settlements with firms marketing supplements and making misleading and unreliable claims.

Reilly Dolan, acting deputy director of FTC’s Bureau of Consumer Protection, said with US consumers spending $40b annually on the products, including some that “are nothing more than 21st century snake oil,” the agency must be active in supplement advertising enforcement.

Dolan said that “FTC “alone cannot solve this problem” of supplements marketed with unsubstantiated claims. “If you’re looking for a dietary supplement to improve your health, you’re going to have to wade through an awful lot of misleading advertising,” he said.

DoJ also links the sweep to false advertising, though the “centerpiece” case stems from marketing drug-spiked products – an indictment on 11 criminal charges against [USPlabs LLC], contract manufacturer S.K. Laboratories Inc. and executives with the firms.

No retailers are identified in the enforcement actions the agencies announced, unlike recent actions by states targeting chains selling supplements that allegedly are noncompliant with state and FDA regulations. Only federal agencies and the US Anti-Doping Agency were represented in the DoJ briefing, and no speaker mentioned state enforcement actions.

Tracking Enforcement In Supplement Space

“The Tan Sheet” previously has reported on many of these enforcements by FDA, FTC and DoJ. In this issue online, we compiled a list of our articles with summaries about these and related cases we have reported and links to additional complaints the agencies announced in the sweep, (Also see "Tracking Federal Agencies’ Enforcement In Supplement Space" - Pink Sheet, 23 Nov, 2015.).

The Department of Defense and the US Postal Inspection Services also are working with DoJ on the 40 criminal and civil actions dating from November 2014 announced during the briefing, including the USPlabs indictment and FTC complaints. In addition to charges of drug-spiked products and unsubstantiated claims, the cases include prosecutions on allegations of supplement good manufacturing practices problems, counterfeit product marketing and violations of business or trade regulations.

Separating Compliant From Violative

Benjamin Mizer, head of DoJ’s Civil Bureau and principal deputy assistant attorney general, noted the entire industry as he described the enforcement actions.

“We are not here to criticize the entire supplement marketplace,” Mizer said, but added, “consumers must be on guard before taking dietary supplements. Oftentimes it may be difficult or impossible for a consumer to tell where or how a product is manufactured.”

He said USPlabs misled regulatory agencies, retailers and consumers as it “raked in hundreds of millions of dollars in sales.” The firm based its business on “a perpetual search for the next miracle ingredient. That search generally focused on Chinese chemical manufacturers,” Mizer said.

USPlabs’ dimethylamylamine-containing products were linked to acute non-viral hepatitis cases reported in late 2013 in Hawaii and other states. The adverse events, including deaths, were reported after the Dallas-based firm said it was compliant with a 2012 FDA warning to cease using DMAA (Also see "DMAA Product OxyElite Pro Named Potential Link In Acute Hepatitis Cases" - Pink Sheet, 9 Oct, 2013.).

Mizer said USPlabs falsified records in order to import certain ingredients and convince retailers its products were compliant with FDA regulations and mislabeled products to prevent disclosing the actual ingredients.

The alleged noncompliant practices caught up with USPlabs when its products were linked to reports of liver failure in 2013, and the firm’s response likely led to the criminal indictment two years later.

“How did the defendant respond?” Mizer said. “They promised the FDA and the public they would stop distributing the product at issue, but they did not. Instead they took a surreptitious, all-hands-on-deck [response] and sold as much of the product as they could.”

USADA has lobbied Congress to tighten oversight of supplement manufacturing and marketing, and Amy Eichner, a physician and the organization’s special advisor on drugs and supplements, spared the industry no criticism in her remarks.

“All athletes, including recreational level, youth athletes, masters athletes, even the kids on playing fields in your neighborhoods are very heavily targeted by dietary companies wanting to sell them products, especially sports and performance-enhancing products,” Eichner said.

The United Natural Products Alliance says remarks during the briefing unfairly grouped compliant supplement firms with those marketing spiked products, making disease claims or flaunting other regulations. UNPA requires its members not to sell products containing ingredients FDA has identified as violative or that could be used inappropriately, such as bulk powder caffeine.

“UNPA has spent a lot of time and energy on education and self-policing, but we need the force of law, as seen today, to remove products and companies that have no interest in selling legitimate dietary supplements,” said President Loren Israelsen.

“However, one unfortunate message was the frequent use of the term ‘dangerous dietary supplements,’ when the law does not recognize the suspect products as dietary supplements but rather unapproved drugs, which FDA has noted on many occasions and which would have been useful to repeat” during the DoJ briefing, Israelsen said.

Answering Critics?

While supplement industry trade groups welcomed the sweep as a sign of the regulatory authority FDA and other agencies can use to enforce against violative products and firms, critics of FDA’s regulation of the industry – on Capitol Hill, involved in research and from consumer advocacy groups – likely see the enforcement as overdue.

With industry allies in both chambers of Congress, chances are slim for legislation that would amend the Dietary Supplement Health and Education Act to fundamentally change FDA’s oversight, particularly by establishing a requirement for some form of pre-market approval or review of supplement products.

DoJ officials occasionally state that the agency intends to increase enforcement in the supplement market, such as the Consumer Protection Branch director’s December 2014 comments on bringing criminal charges to “effect positive change” (Also see "DoJ Aims To ‘Do Something About’ Crime In FDA-Regulated Industries" - Pink Sheet, 12 Dec, 2014.).

The industry’s Senate champions, Orrin Hatch, R-Utah, and Martin Heinrich, D-NM, urged Park Doctrine prosecutions against marketers of spiked products in a May letter congratulating Attorney General Loretta Lynch on her appointment and requesting DoJ help in ridding the market of products labeled as supplements but containing anabolic steroids, active pharmaceutical ingredients or their analogs (Also see "Senators Push Park Doctrine Prosecution For Spiked Supplement ‘Criminal Endeavors’" - Pink Sheet, 20 May, 2015.).

However, other members occasionally question FDA’s regulation of the industry and call for more stringent enforcement than is authorized under DSHEA.

DoJ’s sweep announcement comes soon after Sen. Claire McCaskill, D-MO, twice criticized the agency for allowing firms to market supplements making cognitive benefit claims and also asked retailers to stop selling certain products; and after several notable reports in peer-reviewed journals pointing to inadequate enforcement to ensure safety in the supplement marketplace ( (Also see "Sen. McCaskill Reaches Out To Retailers On Picamilon ‘In The Absence Of FDA Action’" - Pink Sheet, 16 Nov, 2015.) and (Also see "Sharfstein Suggests Requiring Supplements Registration, Testing Standards" - Pink Sheet, 9 Nov, 2015.)).

Mizer noted during the briefing that news comes “almost every day” about “dangerous dietary supplements,” with either spiked products or violative claims being reported. He said consumers buy supplements “not knowing whether they are wasting money or whether they will end up harming rather than helping themselves.”

FDA’s Sklamberg described supplements making disease claims as “scams” that “lead to delays in getting proper diagnosis and treatment and waste money and … can cause serious and often fatal injuries.”

Although commenting on enforcement actions, Sklamberg listed reasons the agency, and critics of the industry, says preclude effective oversight of supplement manufacturers and marketers.

In addition to “a vast array or products” manufactured through “a complicated supply chain,” the industry includes some businesses that evade FDA, Sklamberg said.

“We find that a company using one name and one supply chain can change course the very next day with its name and we’re back to square one.”

However, the sweep should squelch arguments that FDA has insufficient authority to ensure that only safe supplements are available to US consumers, trade group executives say.

“I think that was put to bed today,” said Daniel Fabricant, executive director and CEO of the Natural Products Association.

DoJ’s “Mizer accurately identified enforcement and education as the most effective steps that can be taken to mitigate the risk of criminals looking to defraud dietary supplement consumers by selling unlawful products," said American Herbal Products Association President Michael McGuffin in a statement.

While DoJ’s announcement is a sign of increased enforcement trade groups have requested, comments critical of the industry signal that some groups are not satisfied.

“That may be their personal feelings and they’re certainly entitled to them,” Fabricant said.

Once the bad actors are removed from the market, though, critics should have much less to say, he added. “The industry is kind of boring when you look at it.”

US Pharmacopeia said the sweep shows protecting “public health depends on a safety net that relies on the coordinated efforts of multiple actors,” and pointed out that USPlabs is not connected in any way with the standards-setting organization.

“The contrast between our two organizations could not be greater. We find the confusion caused by their name unfortunate,” said USP CEO Ronald Piervincenzi in a statement.