Dietary Supplement Industry Self-Regulation: How the The National Advertising Division Is Helping

In 2006, the Council for Responsible Nutrition (CRN; Washington, DC) established an initiative with the Better Business Bureau’s National Advertising Division (NAD; New York City), by which the NAD-which examines ad claims for many products and services-devoted a full-time, experienced advertising review attorney to handle an increased dietary supplement caseload. CRN began the initiative by providing funding for a period of three years, through November 2009; the NAD, in turn, committed to increasing its annual dietary supplements caseload from eight cases (on average prior to the initiative) to more than 30.

Citing the initiative, then-director of the FTC’s Bureau of Consumer Protection, Lydia Parnes, stated, “[T]he FTC strongly supports effective self-regulation. The [CRN] is taking a positive step forward in partnering with the [NAD] to increase the self-regulatory review of dietary supplement advertising. Industry members have a real opportunity to learn from NAD decisions and build consumer confidence.” Then-FTC Commissioner Rosch lauded the CRN/NAD initiative, calling it “an excellent example of self-regulation that will increase monitoring of advertising for dietary supplements…and encourage [dietary supplement companies] to file a competitive challenge with the NAD if they see a supplement ad that’s misleading, untruthful, or includes claims that can’t be substantiated.”

We are seven years into this initiative. So, how is it working? The answer: pretty well.

The NAD’s goal is to encourage companies to voluntarily correct questionable advertising. If a company does not follow the NAD’s suggestions to correct its advertising, the NAD may then refer the case to the FTC. In 2011 and 2012, the NAD handled 45 dietary supplements cases and obtained voluntary compliance with NAD recommendations in all but two cases, which were then referred to the FTC for further review. While the total number of cases NAD handles is holding steady, the small number of FTC referrals indicates a strong willingness on the part of the industry to comply with the decisions of this self-regulatory system.

Steve Mister, CRN’s president and CEO, has stated that the NAD program is intended to, 1) improve the industry’s track record for truthful, non-misleading advertising, 2) provide transparency by involving a credible and independent third party, and 3) promote a forum in which companies can engage in a process that allows them to self-correct and modify ads, preferably before they reach scrutiny by the FTC.

In all of these areas, the CRN–NAD model has been successful. And while self-regulation does not replace the need for robust government enforcement or for industry to comply with government regulation, it has proven to be an important supplement to the FTC’s work, while helping to increase consumer confidence and improve the overall quality of advertising throughout the industry. As Mister has stated, “Government regulation and self-regulation work hand-in-hand to build a stronger, more trustworthy dietary supplement industry-something we need if we want our industry to continue to thrive.”

Kathleen Dunnigan, the NAD senior staff attorney responsible for the cases brought under the CRN initiative, reports that she is seeing a steady number of cases involving testimonial endorsements. The FTC in 2009 strengthened its guidelines for the use of testimonials and endorsements in advertising. For testimonials, an advertiser must possess independent, competent, and reliable scientific evidence that supports the consumer’s testimonial experience. As a defense to challenges regarding atypical consumer experiences, Dunnigan states that advertisers will often cite the FTC’s position that advertisers must “clearly disclose the results that consumers can generally expect” to stand for the proposition that, by doing so, they may advertise any atypical experience. This begs the question, however, of what exactly is a typical experience.

Dunnigan reports that she is regularly considering whether firms can support clinically proven claims. For example, in a recent joint-supplement case, the advertiser produced clinical studies involving participants whose average age was 60-years-old and who experienced mild joint-pain reduction and improved function. The advertiser, however, published testimonials about an 82-year-old who could ski and a 90-year-old who could walk and play golf without pain after taking supplements. NAD recommended the advertiser discontinue these claims because it did not have any evidence that reflected the typical experience for 80- and 90-year-olds engaging in high-impact activities. That decision is currently on appeal.

Self-regulation has also been effective in helping the industry understand the level of support required to substantiate “clinically proven” claims, on either finished supplements or their ingredients. This growing recognition of the importance of clinical studies to support many types of claims is a very positive development. Advertisers need to bear in mind, however, that conducting the testing and getting statistically significant results are not the end of advertising claims analysis.

Recently, two dietary supplement advertisers seeking to make superior bioavailability claims engaged in sophisticated in vitro testing normally reserved for drugs; one used a CaCo-2 intestinal model and the other a USP dissolution test. NAD recommended that both discontinue their claims because, while both tests were designed to analyze some aspects of bioavailability, they could not, on their own, adequately predict the bioavailability of a product in the human body. The evidence must be a good fit for the advertising claims, no matter how sophisticated the testing.

The problem of advertising claims getting ahead of the science has increased with the uptick in “clinically proven” health claims. For example, advertisers claiming that a novel ingredient or a novel formulation of a well-known supplement-such as omega-3 supplements in phospholipid form, as opposed to the more common triglyceride form-are more bioavailable should have more than in vitro or animal studies to support such claims. The NAD/CRN decisions are helping to further this understanding among industry members.

With these successes, why does the NAD program currently fall short of a perfect grade? Primarily because the industry has not fully embraced the full potential of the self-regulatory process by challenging competitors’ questionable health claims. Most NAD cases are brought pursuant to the NAD’s monitoring authority (the NAD brought 16 cases to address in 2012) or by CRN (which referred 16 cases to the NAD in 2012); by contrast, there were only five direct challenges by a supplement company last year.

Supplement marketers should not shy away from directly challenging competitors’ claims, particularly when alleged false claims could be giving their competitors an unfair advantage with customers. In order for the NAD program to thrive and fully realize its objective, supplement companies will need to embrace the role of challenger. Once they do so, the industry will be a whole lot closer to discontinuing claims that do not meet high standards for truthfulness and accuracy. And this will be a good thing for the industry and for consumers alike.