Beyond the Warning Letter: FDA Ups The Enforcement Ante

by Marc Ullman and Steven Shapiro

Nearly 20 years after passage of the Dietary Supplement Health and Education Act of 1994 (DSHEA), FDA continues to struggle with full implementation and enforcement of laws pertaining to the dietary supplement industry, such as GMPs (good manufacturing practices) and new dietary ingredients (NDIs). Many of these issues are apparent in the warning letters posted on the agencys website every Tuesday morning. Many weeks, FDA publishes multiple letters addressing manufacturers that seem to have a total lack of control in their facilities, companies making claims that their products cure or treat serious disease conditions or both. At the same time, FDA continues to struggle with NDIs coming into the market without the requisite 75-day pre-market notification and demonstration of a reasonable expectation of safety. In fact, many companies brag" they are bringing their ingredients to the supplement market without filing because they are relying on another companys notificationeven though the manufacturing process for the me too" ingredient may be utterly unrelated to the one described in the NDI notification.

Many of these ongoing compliance issues seem to stem from a perception that FDA cannot, or will not, do anything more than send a letter requesting that companies come into compliance. The all-too common retort to questions about compliance remains, Whats the worst thing that can happen to me, a warning letter?" Recent FDA enforcement activities suggest the answer to this question should be, No, actually FDA canand maydo a lot more."

One of the most potent, though limited, enforcement tools at FDAs disposal is the imposition of an import alert for detention without physical examination of dietary supplements or dietary ingredients that appear to be out of compliance. Companies that full under such an alert will find they are unable to get their products through customs and into the United States. Many in the herbal trade are familiar with import alerts relating to the presence (of sometimes miniscule amounts) of pesticides. However, import alerts can also be used to block products coming from facilities outside of the United States that are not compliant with the dietary supplement GMPs. Thus, the agency issued, "Import Alert 54-14, Detention Without Physical Examination of Dietary Supplement Products from Firms Which Have Not Met Dietary Supplement GMPs" (published June 1, 2012). While only one firm has been listed on this import alert to date, any dietary supplement manufacturer outside of the United States that does not comply is in jeopardy of having its products kept out of the country. Import alerts have also been used by FDA to block products making illegal drug claims (Import Alert 66-41) as well as products that use the misleading terminology Siberian ginseng" on their labels (Import Alert 54-12).

Administrative detention is a broader enforcement tool available to FDA. Following enactment of the Food Safety Modernization Act (FSMA), FDA has the power to detain any food, including dietary supplements, that a qualified FDA official has reason to believe is adulterated or misbranded." The agency recently used this power to place a hold on products containing DMAA, preventing them from leaving warehouses operated by GNC Holdings Inc. and USPlabs, the Dallas-based manufacturer of the OxyElite Pro and Jack3d supplements. In both of these cases, FDA was able to freeze the supplements in place for 20 days, plus a 10-day extension to allow it to pursue an injunction action. Rather than seek an administrative hearing to review the detention or challenge FDAs action in court, both companies ended up destroying the seized products, which had an estimated market value in excess of US$8 million.

Companies that persistently flout FDAs authority run the risk of even more serious enforcement action. In April 2013, Amityville, NY-based Kabco Pharmaceuticals entered into a court ordered consent injunction barring the company and its CEO from operating any business that is not in compliance with the dietary supplement GMPs. It is particularly significant to note that the injunction applies not only to the company, but also personally to the responsible ownership who did not act in response to numerous warnings from FDA about deficiencies at the companys facilities. The injunction further required Kabco to destroy product FDA deemed non-compliant and to retain an independent expert consultant, who must report to FDA that the company is capable of compliance before it can resume manufacturing operations. Kabco was also the subject of two FDA-mandated recalls for the shipment of more than 2,000 kilos of bulk vanilla and chocolate formulas.

The ultimate enforcement tool at FDAs disposal is criminal prosecution. These cases are most frequently seen in matters involving the sale of products labeled as dietary supplements that are spiked with active pharmaceutical ingredients (APIs) or steroids. Recent examples of such prosecutions include 2012 guilty pleas by Bodybuilding.com and the companys two principals relating to the sale of misbranded drugs masquerading as dietary supplements that contained anabolic steroids. The sentence in that case included the imposition of in excess of $8.1 million in criminal fines for violations of the Food Drug and Cosmetic Act (FDCA). In May 2013, Dean Harvey of West Jordan, UT, pleaded guilty to multiple violations of the FDCA relating a conspiracy to sell dietary supplements containing ephedrine alkaloids as well as an additional conspiracy to sell supplements adulterated with an API similar to sildenafil citrate, the active ingredient in Viagra. The plea agreement called for Harvey to be sentenced to 36 months imprisonment and to forfeit in excess of $500,000.

FDA has also prosecuted companies and individuals that flout court orders relating to GMPseven in the absence of other adulteration. Thus, in November 2011, the agency announced the sentencing of New Jersey-based Quality Formulation Laboratories Inc. and American Sports Nutrition Inc. (ASN), as well as their owner Mohamed S. Desoky and managers Ahmad Desoky Esq. and Omar Desoky, on multiple counts of criminal contempt of court for violating an injunction by opening new facilities and moving their entire operation in order to avoid complying with the terms of the injunction. Sentences in the case included fines up to $60,000 and imprisonment ranging from 35 to 40 months.

As more time passes, and FDA and industry responsible industry run out of patience for companies that simply refuse to comply, do not be surprised to see calls for enforcement actions like these that go well beyond just a warning letter."

Marc Ullman and Steven Shapiro are partners at the New York-based law firm Ullman, Shapiro & Ullman LLC.

Hear Steven Shapiro discuss "How to Handle and Survive a Product Recall" on Friday, Nov. 15 from 2 to 2:50 p.m.; and hear Marc Ullman give tips on "Responding to FDA 483s and Warning Letters," on Thursday, Nov. 14, from 10 to 10:50 a.m., at SupplySide West, Las Vegas.