Supplement Maker Talks Small Biz Woes at GOP Convention

August 23, 2012

3 Min Read
Supplement Maker Talks Small Biz Woes at GOP Convention

DALLASDietary supplement distributor Essential Formulas Inc., at the request of Rep. Marsha Blackburn (R-Tenn.), presented testimony before the 2012 Republican National Convention Committee on Resolution during its August sessions in Tampa, Fla.  The company talked about the difficulties small  businesses are facing in this troubled economy, highlighting the abundance of federal, state and local regulations. Calling these regulations an unjustified burden, the company said dietary supplements are particularly challenged and cited the beleaguered new dietary ingredient (NDI) guidance as an example.

"Unfair regulatory burdens on dietary supplement businesses are unjustified and must be revisited and lifted where appropriate," said Michael Schoor, president of Essential Formulas. Our industry has complied with the Dietary Supplement Health and Education Act of 1994 (DSHEA) while ensuring that dietary supplements remain safe for consumption. He further reported that many industry insider believe the NDI guidance is one step in FDA's plan to gain a pre-market authorization for supplements, a regulatory move that would go against DSHEA.

During the testimony, Essential Formulas referenced data from Emory University, Atlanta, showing the NDI guidance, if adopted as-is, would force between 22,240 and 41,700 dietary supplements to be removed from the market, resulting in an economic loss of between $5.6 billion and $10.5 billion. IN the report on the exhaustive economic study of the potential impact of the NDI guidance on the dietary supplement industry, Joanna M. Shepherd Bailey, Ph.D., professor of law and economics at Emory,  reported, The Guidance will cause a total economic loss of $21.2 billion to $39.8 billion annually in the economy.  It will also cause 127,598 to 239,247 jobs to be lost throughout the U.S. economy.

Explaining the economy's effect, Schoor reported his company's triple-digit growth from 2000 to 2009 has slowed considerably to modest growth in recent years. With the failure of the economy to bounce back after 2009, we are very worried about our continued growth and corporate vitality," Schoor said, adding one of the most important concerns is the devaluation of the dollar. "A strong dollar is paramount to our continued growth since we must buy our probiotic products and other dietary supplements from a well-respected Japanese supplier and, thus, pay in yen.  Today, this significant devaluation of the dollar cuts directly into our ability to pay salaries and fund business expenses. He further blamed his reluctance to fill open positions in his company on uncertainty due to the dollars devaluation, economic uncertainty and regulatory burdens.

The Essential Formulas testimony called on the 2012 Republican National Convention Committee on Resolutions to change its platform statement to: recognize the importance of the dietary supplement industry and the American consumers of dietary supplements to the overall economic health of America; and urge Federal agencies to work with the industry in a spirit of cooperation during enforcement of DSHEA and other relevant laws.  The company suggested FDA reconsider parts of the NDI guidance that are overly burdensome and contrary to the statute, Congressional intent, science and reasoned policy considerations.  It offered this recommendation for not only new policies but also the agencys continued policy of treating the NDI notification provision as a premarket approval provision. Further, the company said FDA must fully analyze the economic impact on small businesses of compliance with the NDI notification submission requirements under the draft guidance.    


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