Patchwork of new retailer-driven dietary supplement standards alarms some industry members

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The dietary supplements industry has long been the subject of heavy scrutiny by both the general public and regulators. Media reports raise a flag whenever a supplement product is discovered not to contain what the product label said it contained, or when it’s revealed that a supplement was adulterated or spiked with drug ingredients and masqueraded as a dietary supplement. These are legitimate problems that are also concerning to responsible companies in the dietary supplement market.

Retailers who sell dietary supplements are under more pressure than ever to act as gatekeepers and to ensure the products they sell on their shelves and websites are authentic and safe—and to keep unsafe products out. Who can forget that six years ago in 2015, New York Attorney General Eric Schneiderman ordered retailers GNC, Target, Walgreens, and Walmart to pull herbal supplements off their shelves after he claimed DNA testing his office commissioned found some products not meeting label claims. (Many in the supplements industry questioned the AG’s results, pointing out that the DNA tests used were not suited for testing finished products.)

Under this kind of pressure, more retailers have decided to implement their own retailer-devised standards for dietary supplements—a set of requirements unique to each retailer that supplement manufacturers’ products must pass in order for the retailer to go ahead and sell the products.

While these retailer standards probably sound like a good idea to the consumer, for supplement manufacturers having to clear standards set by each individual retailer creates a host of potential problems.

Retailers Forging Ahead

Two major retailers have so far launched their own set of retailer standards. In May 2019, CVS launched Tested to Be Trusted, “a program requiring third-party testing of all vitamins and supplements sold in-store and online to confirm the accuracy of the dietary ingredients listed on the supplement facts panel and to confirm products are free from certain additives and ingredients.” At the time, CVS said that 1400 vitamins and supplement products from 152 brands had completed the testing.

Among the requirements, supplement products sold via CVS must be third-party tested, and by only the third-party certification programs that CVS designates: UL, Eurofins, NSF International, and USP. Products must be tested for heavy metals, pesticides, microbial content, industrial contaminants, and known adulterants. Also, if products make “free from” claims such as “gluten free,” there must be certification attesting that this is in fact true. In addition, manufacturing facilities must be FDA-registered.

In December 2020, Amazon.com launched its own set of rules for products sold as dietary supplements on its site. First, Amazon specifies that companies listing products on Amazon “must comply with all federal, state, [and] local laws” related to dietary supplements, including 21 CFR 101.36 (nutritional labeling of dietary supplements) and 21 CFR Part 111 (Good Manufacturing Practices, or GMPs, for dietary supplements). Among other requirements, manufacturers who want to sell dietary supplement products on Amazon.com must now submit either, 1) a Certificate of Analysis (CoA) from an ISO/IEC 17025–accredited laboratory (in-house or third-party) for each dietary supplement, or 2) third-party certifications from either NSF International’s Certified for Sport program, the Banned Substances Control Group (BSCG), Informed Choice/Informed Sport, or USP’s Dietary Supplement Verification Program.

Not only that, but Amazon requires a “letter of guarantee” from brand owners affirming that, 1) the product was manufactured according to Good Manufacturing Practices, 2) “assurance” that the product only contains ingredients that are “lawful and safe, as defined in Section 402(f) of the Food, Drug, and Cosmetics Act (FD&C Act),” and 3) “assurance that concentration of active ingredient(s) as stated on the label and labeling is safe for consumption.” These Amazon.com requirements are now in effect.

The Challenges for Industry

In a blog post published on December 18, 2020, two attorneys from law firm Arnall Golden Gregory LLP (Washington, DC), Richard J. Oparil, partner, and Robert Durkin, of counsel, wrote about the challenges that Amazon’s retailer standards present supplement marketers, as well as potential compliance gaps the standards don’t address.

First, they pointed out, it’s currently unclear how Amazon intends to review submitted CoAs for accuracy, a process which the attorneys noted is very time-consuming and complex. Also, although Amazon requires a CoA, which would affirm whether the product contains the ingredients listed on the label, Amazon has not seemed to establish requirements for affirming the absence of known adulterants or contaminants. The attorneys also said that the broad requirement that CoAs be provided by an “ISO/IEC 17025–accredited laboratory” should be made more specific by requiring that “the lab be accredited in the specific tests used in creating the CoA.”

Second, the attorneys stressed, the requirement that supplement marketers/brand owners must guarantee products are compliant with Section 402(f) of the FD&C Act is more complex than it seems. For instance, by law, a dietary supplement would be classified as adulterated if it contains a New Dietary Ingredient (NDI) but if an NDI notification for the ingredient has not been submitted to FDA. The party introducing an NDI to the marketplace—which could be an ingredient supplier or someone else farther back in the supply chain—is legally responsible for submitting an NDI notification to FDA before the ingredient is sold on the market; however, under the FD&C Act, manufacturers are not the parties required to affirm that an ingredient in a product should be classified as an NDI and whether an NDI notification should have been submitted. On this front, Oparil and Durkin say, it could be difficult for a manufacturer to guarantee to Amazon.com that a product has met all legal requirements.

Finally, the attorneys said, requiring companies to make affirmative statements about their products—for instance, the “letter of guarantee”—opens companies up to being sued by class action attorneys claiming that the statements are “false and misleading.” They noted: “There has recently been a plethora of such suits filed under the federal Lanham Act or state deceptive trade practices, alleging such things as the label misstates the amount of the ingredients in the bottle, the product is not ‘all-natural,’ or the product contains detectible levels of lead or other heavy metals. We would expect class action plaintiffs to include in their complaints that the defendant companies made misrepresentations to consumers as well as Amazon.”

Durkin also spoke to Nutritional Outlook about the CVS Tested to Be Trusted standards. “CVS’s program is different from that of Amazon in that it does not require any attestations from the manufacturers of products,” he says. “Where Amazon tries partly to ensure quality by putting the manufacturer at risk of liability for having attested to a product’s quality, CVS does it by requiring third-party testing of products.”

He continues: “My concern with CVS’s program is that it only requires an initial screening. A program like this can only be effective if it works to ensure quality of products over the long-run.”

Patchwork of Requirements

But there are other concerns, too. How will a dietary supplement company who sells products through multiple retailers reasonably be able to satisfy a patchwork of retailer requirements, especially if more retailers enact their own standards down the road? Also, are these retailer requirements repetitive to what many companies are already doing?

Megan Olsen, vice president and associate general counsel at the Council for Responsible Nutrition (CRN; Washington, DC), says that because many responsible supplement companies—the ones with too much on the line not to comply with the highest quality standards—already voluntarily maintain third-party certifications for their products and high manufacturing and testing standards (likely from many of the same certification bodies retailers would make them use)—individual retailer regulations are likely to be “duplicative” to what these companies are already doing.

Says Olsen: “CRN recognizes the importance of retail standards, as these programs help to identify responsible dietary supplement companies and work to keep less-reputable players out of the supplement aisle. However, retailers have created a complicated patchwork of requirements that can add unnecessary burdens and costs if requirements are duplicative or inconsistent.”

She continues: “CRN is concerned that duplicative and rigid retail standards will limit flexibility for manufacturers to select third-party labs with whom they already have a relationship with [and] limit the ability to use their own in-house labs or other metrics to demonstrate regulatory compliance.”

And there’s cost involved. “Patchwork standards also create a situation where manufacturers will likely have to conduct duplicative testing that will drive up costs that eventually impact the consumer”—which, she points out, could ultimately limit consumer access to supplements. CRN says one industry executive estimated that the additional cost to a company of complying with the retailer testing requirements could amount to several hundreds of thousands of dollars per year for each product.

These problems could become very real, very soon. As Olsen points out, more retailer standards may be on the way. “Currently, CVS and Amazon are the only retailers to have launched public-facing standards, but CRN is aware of other large retailers that have programs in process,” she says.

Olsen says CRN is now trying to determine if retailers would be open to harmonizing a single set of retailer standards.

CRN recently created a Retailer Standards Working Group for its members to further the discussion. Recently, the association hosted a panel on the issue with companies such as Pharmavite and Gemini Pharmaceuticals. Pharmavite and Gemini Pharmaceuticals are part of the Global Retailers and Manufacturers Alliance (GRMA), an initiative started years ago with the goal of bringing together stakeholders—retailers, manufacturers, trade associations, etc.—to develop a single set of retailer standards. CRN has worked closely with GRMA.

Another retailer-led effort is the Supplement Safety Compliance Initiative (SSCI), which has worked closely with the Natural Products Association (NPA; Washington, DC) and whose participants include retailers like Walmart and GNC and companies such as Pharmavite, NOW Foods, and New Chapter. SSCI’s goal is to develop harmonized benchmarking guidelines for retailers. Last year, SSCI released its technical benchmarking guidance documents for public review and comment.

Of CRN’s efforts to encourage retailers and and industry to collaborate, Olsen says, “We are asking that retailers come to the table and bring industry into the conversation. CRN, retailers, and industry all want the same thing—consumer safety and access to safe and beneficial products. We’re encouraging retailers to give industry the opportunity to provide input into their current and forthcoming standards…We believe these discussions could highlight other metrics that can be used to demonstrate regulatory compliance, such as the use of GMP audits, and the importance of flexible standards that allow a manufacturer to select the most appropriate lab to test their products, whether that be internal or a third-party lab with which the retailer already has a relationship.”

Are these various parties likely to come together and reach agreement? Olsen says CRN is “hopeful.” She says, “Retailers have signaled they are open to having this conversation with industry, and we are optimistic this could lead to harmonization in the future. Establishing uniform requirements will bring predictability and consistency to retailer product review, allowing responsible companies to demonstrate that they comply with the law and increase consumer confidence in the industry.”

Again, that’s an important point. While there are noncompliant companies on the market, many retailers are already working with reputable companies who are doing their utmost to adhere to safety standards. For these companies especially, these retailer standards may be unnecessary. Olsen says: “CRN recognizes that voluntary, third-party certifications are just one way companies can invest in their brand, but an absence of a seal does not mean that a product is of poor quality. Current regulation requires that dietary supplements adhere to current Good Manufacturing Practices (cGMPS), testing procedures, labeling and storage requirements, and other practices enforced by regulatory agencies at both the federal and state level.”

She concludes: “While we applaud the intention of retail standards to decrease the chance of bad products getting into the hands of consumers, the programs of which we are currently aware are duplicative or inconsistent with current manufacturing practices.”

Durkin looks down the road and tells Nutritional Outlook that these standards could eventually have an impact that would alter the retail space. “It is a shame that the current regulatory situation, or lack of one, has pushed retailers to take matters into their own hands to ensure their customers have access to wholesome and safe dietary supplements,” he comments. “There are many programs like these popping up. It is eventually going to become difficult for manufacturers and distributors to keep up, and eventually they may have to make a choice of which retail outlets they want to work with. This also has to translate into an increase of cost to consumers. I hope that the good players in the space will rise to the top—we might even see a move to consumers purchasing personal health and wellness products from these good players’ direct-to-consumer platforms.”

For both supplement manufacturers and supplement retailers, there’s plenty on the line.