GNC Holdings Inc., the specialty retailer of health and wellness products, on Monday said it has reached an agreement with New York Attorney General Eric Schneiderman that affirmed its compliance with federal manufacturing regulations.

“NYAG found no evidence in the course of its investigation that GNC deviated from the federal Food and Drug Administration (FDA) Current Good Manufacturing Practices (cGMPs) rules or standard industry practice in the production of the Tested Supplements," according to the six-page agreement between GNC and Schneiderman’s office.

The pact was announced approximately two months after Schneiderman announced that DNA barcoding tests conducted on herbal supplements sold by GNC, Walmart, Walgreens and Target revealed the products largely failed to contain the labeled herbs and were contaminated with other plant material. New York authorities sent cease-and-desist letters to the four retailers after a Clarkson University biology professor conducted 390 tests on 78 samples of such popular herbs as Ginkgo biloba, St. John’s wort, ginseng and garlic.

Under the agreement announced Monday and first reported by the New York Times, GNC said it will integrate DNA barcoding where appropriate and make other enhancements that it believes will lead to “the adoption of stricter minimum standards across the broader industry."

Within 18 months, the retailer will begin using DNA barcoding to confirm the authenticity of all plants used for its herbal supplements products before processing, according to a press release issued by Schneiderman’s office.

“In cases where no DNA barcode is yet available for the relevant species, GNC has committed to perform its own sample collection – DNA isolation and sequencing – to create a DNA barcode for that plant ingredient," Schneiderman’s press release added. “GNC will contribute any new barcodes, and the scientific methods used to identify them, to a publicly accessible database within 24 months."

The release also noted GNC agreed to test for allergen contaminants before and after production, and post conspicuous signs that advise “consumers of the processed, chemical nature of extracts."

“When consumers take an herbal supplement, they should be able to do so with full knowledge of what is in that product and confidence that every precaution was taken to ensure its authenticity and purity," Schneiderman said in a statement.

A New York lawmaker, some medical professionals and others quoted in Scheiderman’s press release hailed the agreement as a step in the right direction.

"The agreement GNC reached with New York State represents important progress in ensuring that supplements contain what they claim to," said David Schardt, senior nutritionist with the Center for Science in the Public Interest (CSPI), in a statement. “But Congress should pass reform that would allow the FDA to police this marketplace and remove products that are dishonestly marketed or potentially dangerous."

Schneiderman used DNA barcoding to test the finished the products that are sold by the four retailers. 

The supplement industry has criticized Schneiderman’s testing methodology, saying it may fail to detect botanical extracts and cannot quantify the amount of contaminants in a product. The federal agency that oversees supplements—FDA—doesn’t presently use DNA technology to identify botanicals.

Mark Blumenthal of the American Botanical Council (ABC) said in a press release that Schneiderman appears to be establishing testing requirements that exceed those set by FDA.

The supplement industry isn’t happy about that.

“Federal GMPs are the law of land," said Daniel Fabricant, Ph.D., executive director and CEO of the Natural Products Association (NPA), in a phone interview. “That’s what people should adhere to and that’s what gives consumers confidence."

Douglas Karas, an FDA spokesman, said, “We are aware of the agreement, and will continue to work with our state partners and those in industry to ensure that dietary supplements are in compliance with federal law.”

The signed agreement acknowledged that FDA permits companies to support their claims through other testing methodologies, including chemical analysis methods, but New York authorities disagree with GNC on whether such measures are sufficient.

“Given the existence of chemically similar natural or synthetic substitutes, NYAG is concerned that standard chemical approaches provide inadequate assurance of the authenticity of herbal supplements," noted the March 27 agreement. “With respect to purity, FDA cGMP regulations allow for low levels of inadvertent contamination, including from allergens.  NYAG is concerned, however, that there is no federal testing of products manufactured in cGMP facilities to confirm that contamination falls below relevant safety thresholds."

Federal regulations already impose limits on such contaminants as heavy metals and bacteria, said Fabricant, a former leader of FDA’s supplement division. And just because an herb such as St. John’s wort contains a negligible amount of dandelion pollen doesn’t render it contaminated, he said.

It is the “manufacturer’s responsibility to know what the safety profile of their product is," Fabricant said. “Do we test milk for infinitesimally small amounts of cow hair? No. You know why … it doesn’t make the milk a spoiled or adulterated good. He [Schneiderman] is looking for needles in a haystack that have no bearing on public health."

Of the four national retailers investigated by Schneiderman, GNC has been the most vocal about defending its products. It has repeatedly refuted Schneiderman’s initial findings that its herbal products were fraudulently labeled.

GNC, which sells its products in more than 8,900 locations under the GNC brand name and posted 2014 revenues of USD $2.6 billion, said it provided Schneiderman the results of tests that were provided internally and by third parties. GNC said its test results conclusively established the herbal products were properly labeled, safe and in full compliance with regulatory requirements including cGMPs.

“A robust testing regime, careful sourcing regimen and detailed manufacturing specifications have always been core elements to ensuring that we provide our customers with high-quality products," GNC CEO Michael Archbold said in a statement.

Schneiderman’s cease-and-desist letters set off a groundswell of proposed class-action lawsuits against the four national retailers. GNC, which denies any wrongdoing in connection with the litigation, represented to Schneiderman’s office that it is holding the affected product lots as proof. The United Natural Products Alliance (UNPA) also tested the product lots that were subject to Schneiderman’s investigation, but it has yet to disclose the results.

Steve Mister, president and CEO of the Council for Responsible Nutrition (CRN), characterized GNC's agreement with New York authorities as a "disservice to consumers because it wrongly perpetuates the misdirected notion that DNA barcode testing is appropriate for herbal supplements, when it is not."

"Moreover, the agreement gives credence to the New York AG’s misguided allegations based on its own DNA barcode testing that legitimate quality concerns existed about the products marketed by four retailers, when there were none," Mister added in a statement.

Michael McGuffin, president of the American Herbal Products Association (AHPA), said in a statement that the agreement shows current manufacturing regulations governing supplements are effective. He referenced the agreement's acknowledgement that GNC wasn't found to have violated cGMPs and that Schneiderman's testing "did not reach a final determination that the Tested Supplements were fraudulent."

While AHPA shares Schneiderman's "goal of ensuring consumer access to high-quality herbal products", McGuffin said "DNA testing will add no additional assurance of the correct identification of any herbal ingredient that has already been verified by one or more of the other long-established analytical tools now used by responsible herbal manufacturers."

Schneiderman didn’t comment in the press release on whether agreements were in the works with Target, Walgreens and Walmart. Liz DeBold, a spokeswoman for Schneiderman’s office, said she could confirm the investigation into the three retailers is ongoing.

"Walmart has been complying with the New York Attorney General’s legal requests by submitting information and we will continue to work with his office," Walmart spokesman Brian Nick said in an emailed statement. "The specific products called into question were tested by the manufacturers during and at the end of production and the results confirmed that the ingredients on the label were present and the products were not adulterated."

Molly Snyder, a Target spokeswoman, said, “It’s important to note that we intend to continue fully cooperating during the investigation."

James Graham, a spokesman for Walgreen Co., said Monday that the retailer takes “these issues seriously" as it has previously noted.  “We continue to review this matter and also intend to continue cooperating and working with the attorney general of New York," Graham added in an emailed statement.