Dietary Supplements, Cosmetics, Medical Devices – Why Substantiating Claims Matters

Substantiating claims matters whenever you bring a dietary supplement, cosmetic (or skin care product), or medical device to market – why?

Because otherwise, the private plaintiff bogeyman will get you.

Our FDA lawyers have seen this happen to a number of dietary supplement manufacturers, cosmetics (skin care, cosmeceutical) companies, and medical device makers who brought a product to market without adequately substantiating their claims.

Substantiation simply means, making sure your claims are backed by evidence. So, for example, if you say that your dietary supplement is “organic,” or “natural,” “clinically proven,” “rapid results,” or “the best out there,” or simply that it does X, Y or Z, you are playing with fire if you lack a valid scientific basis for your claims.

There are several sources of risk:

• FDA investigation and enforcement – i.e., possibly a warning letter but also the potential for steeper enforcement such as seizing products and halting sales
• FTC enforcement action – i.e., large penalties and big headlines
• NAD report (National Advertising Division of the Better Business Bureau) – a review of national advertising for truthfulness and accuracy (self-regulation with a public report, copy to FTC)
• Private plaintiff action – a plaintiffs’ law firm may bring a class action and allege deceptive and misleading advertising
• Competitors’ action for unfair competition and false advertising
• State Attorney General action for misleading business practices

The beauty of the system – pardon the pun – is that any one of the above can generate action by the others. It’s a litigation and enforcement nightmare for the dietary supplement, cosmetics, or medical device company.

Early-stage companies tend to be first and hardest hit. Entrepreneurs bring a product to market full of hope and a smidgeon of hype – and fail to have their websites reviewed for all the claims they make about a new product. Before they know it, the private plaintiffs’ firm swoops in with a demand letter.

The legal trinity of consumer products is:

• Claims
• Labeling
• Substantiation

Have each reviewed by FDA legal counsel who is familiar with FDA, FTC, and state advertising legal rules and guidelines. Among other rules:

• Claims of efficacy or safety must be back by competent and reliable evidence.
• Some ads require qualifying statements to ensure that the claims are not misleading.
• Disclosures much be clear and conspicuous.
• Special rules apply to disclosures in mobile advertising.

Cable, broadcast, and online advertising all must comply. In general, advertising must be accurate and not misleading. The amount of evidence required depends on the nature of the claim.

FTC says:

Before a company runs an ad, it has to have a “reasonable basis” for the claims. A “reasonable basis” means objective evidence that supports the claim. The kind of evidence depends on the claim. At a minimum, an advertiser must have the level of evidence that it says it has. For example, the statement “Two out of three doctors recommend ABC Pain Reliever” must be supported by a reliable survey to that effect. If the ad isn’t specific, the FTC looks at several factors to determine what level of proof is necessary, including what experts in the field think is needed to support the claim. In most cases, ads that make health or safety claims must be supported by “competent and reliable scientific evidence” – tests, studies, or other scientific evidence that has been evaluated by people qualified to review it. In addition, any tests or studies must be conducted using methods that experts in the field accept as accurate

And FTC notes that it pays closest attention to:

• Ads that make claims about health or safety (for example: “reduces risk of skin cancer”).
• Ads that make claims that consumers would have trouble evaluating for themselves (for example: “reduces your energy costs by 25%”).

While FTC pays less attention to ads that make subjective claims that consumers can judge for themselves (for example: “tastes great”).

Claims can be implied as well as express.

There are many ways that an ad can be deceptive. For example:

• the “fine print” may be too fine (i.e., not clear and conspicuous);
• the necessary qualifying language may be absent or inadequate;
• the qualifying language might not be understandable to ordinary consumers;
• or the claims could simply be exaggerated, unproven, or lack sufficient evidence.

FTC jurisdiction extends over such diverse advertising areas as:

• alcohol
• catalogues
• children’s advertising
• comparative advertising (comparing your product to another company’s)
• contests and sweepstakes
• dietary supplements
• disclosures and disclaimers
• drug advertising
• endorsement and testimonials (a huge area for consumer products)
• food advertising
• “free” claims and rebate offers
• infomercials and Internet advertising
• Made in the USA
• weight loss products and claims

Let us know if you’d like your advertising reviewed for litigation or enforcement risk when you bring your dietary supplement, cosmetic, medical device, or other consumer product to market.