EU Firms See Opportunity in U.S. Regulations: Vitafoods Feedback

European marketers are increasingly interested in doing business in the United States these days. With so much ongoing confusion and frustration surrounding the European Food Safety Authority’s (EFSA; Parma, Italy) health-claims process, as well as the general preapproval requirements of the Novel Foods process, by contrast the Generally Recognized as Safe (GRAS) and New Dietary Ingredient (NDI) routes for dietary ingredients in the United States are attractive.

Vitafoods 2014 trade show attendee and Nutritional Outlook editorial advisory board member, John Endres, ND, chief science officer for AIBMR Life Sciences (Puyallup, WA), talks about this draw to the U.S. regulatory climate, based on his interactions at the trade show. AIBMR is a U.S.-based natural products consulting firm specializing in domestic and foreign regulatory advice, including GRAS status and NDI notifications,  and product-claims substantiation. 

Nutritional Outlook: Tell us a bit about the show attendees, based on your meetings.

John Endres: The people who attend Vitafoods are very “high-quality,” meaning PhDs, professors, and the like who are already very knowledgeable about ingredients and their science. These aren’t laypeople. And I think the reason for this is partially EFSA and the business climate its regulatory restrictions have created in the nutraceutical space. It’s weeded out some of the “sketchy” companies from doing business in Europe. And that’s very evident from the types of people who come to the booth and the types of people who you talk to at other people’s booths. They are incredibly knowledgeable about their ingredients.

Would you say that doing business in Europe at the moment is difficult?

I wouldn’t say that doing business in Europe is difficult, necessarily. Getting Novel Food status is challenging, but not impossible. But if you take it to the level of getting health claims approved, that’s really difficult. The regulations are much more strict, with many more hoops to go through, compared to in Canada or the United States, in that order. For instance, there are so many people involved with the regulatory and review process in the EU-first to get Novel Food approval and then health claims approval, not only in one member state but EU-wide. It gets really complicated. And, of course, there is a lot of controversy over the science requirements.

Many companies are trying to figure out what they need to do in terms of getting health claims, and they’re afraid to embark on more studies because what’s tended to happen, in practice, is that they’ll ask EFSA what they need to do to get the health claim, and EFSA has basically said, “Well, you guys figure it out, go and do it, and then we’ll review the data.” So, they won’t tell you exactly what you need to do, or they can’t because they haven’t decided on that yet. And then, at the end of the EFSA review, the claim gets rejected and EFSA says, “You should have done this or that” or “We need more information on XX.” So there’s a lot of confusion, and companies are afraid of investing a millions of dollars on research, clinical trials, and innovation, lest those research dollars go to waste. In fact, there were comments at the show that there weren’t a lot of innovative new things at the Vitafoods-and, that may be a result of what’s going on with EFSA.

Why do you believe that European marketers find U.S. regulations more attractive?

What I learned from attendee interactions at our Vitafoods booth is that there is an incredible interest on the part of European companies in obtaining regulatory status-and, specifically, GRAS affirmation-in order to sell their ingredients in the United States. And I think that’s chiefly because the regulatory process is just so difficult in the EU right now. A good example: AIBMR’s senior research associate, Amy Clewell, ND, was on standby as a Vitafoods conference presenter, in case any scheduled presenters were no-shows. Unfortunately, all of the scheduled speakers showed up, so she didn’t have the opportunity to give her presentation, which was supposed to cover the NDI and GRAS regulatory routes in the United States. But she was allowed to present a brief overview of what her talk would have been about, for a few minutes at the end of the conference session, because her presentation slides will still be available on the Vitafoods website. She only spoke for a few minutes, but half of the audience questions thereafter were addressed to her, instead of the other speakers. So it was very evident that Europe has a very large interest in doing business in the United States.

Are European marketers in general knowledgeable about U.S. regulatory channels?

A little bit. They’re somewhat familiar with the process, but they don’t know the details of how to go about navigating the channels. The questions we received at the show were really about that: “How do you go about navigating the regulatory system in the United States?” Another one of our senior research associates, Tennille Marx, ND, gave a talk specifically on that, including comparing and contrasting the GRAS and the NDI processes. There was great interest in her presentation. A lot of people took photos of her Power Point slides. Her session was pretty well attended, and there was a lot of interest in the topic.

But, still, it does take some time to educate people about how regulations work in the United States. In general, it takes about two or three times of talking to someone about what they need to do before, I would say, 90% of people really understand what you’re explaining-and, in Europe, the regulations are even more foreign.

One of the concepts that is foreign to European marketers is the self-affirmation GRAS process and the fact that you can self-affirm an ingredient, or use structure function claims (as long as they are truthful and supported), without having FDA first review the data. These are not preapproval processes, per se, and that’s what EU marketers are used to with the Novel Food and EFSA approval processes. When they talk to us, their language is basically, “We want to get our product registered with the FDA.” And we have to explain how the process works in the United States.

What attracts European marketers to U.S. regulatory options such as self-affirmed GRAS?

The fact that these are not preapproval processes is of great interest to them, in terms of being able to do business here.

Do European marketers understand that FDA still has the authority to request to see any GRAS affirmation data, including self-affirmed? And that the FTC can regulate you on the back end if you make claims that are untruthful or unsupported?

Yes, I think so.

What effects has this increased interest in the United States had on your company, for instance?

There absolutely has been an impact, even from last year to this year. I mean, prior to a year ago, we weren’t really doing business with anybody Europe, per se. We’re now doing business with companies in Austria, Germany, Spain, Netherlands, France, Finland, and now possibly the UK and Belgium. And we’re getting referrals from regulatory specialists in Europe who have even acknowledged that there’s a lot of interest in doing business in the United States right now.

Do you expect to see an influx of U.S. GRAS affirmations and NDI notifications from European companies?

I definitely do.

How might general frustration with EU regulations benefit the U.S. market?

People are definitely frustrated, and it’s making more sense for them to consider other markets, like the United States, which is probably one of the most favorable markets there is for natural products. EU companies can generate some income in the United States, selling products, while they’re dealing with EFSA or trying to figure out what they need to do to make health claims, which is really the issue. So, yes, there’s a lot of interest in coming over here and making money also to support their efforts in Europe.

It’s also important to remember that not only is there great opportunity for European companies to do business here in the states, it’s also a great way for U.S. companies to collaborate with European companies to make some really unique new products. All of the European companies we’re doing business with are making products that haven’t been sold in the United States before. So, these are up-and-coming, novel ideas. It’s just that it’s much more difficult to execute them in the EU than it is to execute them in the United States, currently. So, where EU and U.S. companies are concerned, a partnership almost seems like the perfect marriage.