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FDA Tightens the Screws

Years ago when lawyers in the dietary supplement industry first began to clamor for the adoption of regulations to impose good manufacturing practice guidelines on the industry, I warned that this move would provide an FDA intent on destroying that industry the best means to achieve that objective.  For decades the FDA through Republican and Democratic administrations has endeavored to find a way to limit public access to supplements.  FDA tried to make the RDI the limit for supplements, but failed.  FDA tried to redefine supplements as food additives, requiring drug-type approvals before they could be marketed, but failed.  FDA tried to ban specific supplements and failed on occasion and won on occasion.  FDA tried to eliminate all health related claims about supplements from the market but failed.  The most promising angle for FDA, however, was to rely on the public safety argument.  That is where the GMPs came in, surprisingly served to the agency by the industry on a silver platter.

Although without the GMPs dietary supplements have been the safest ingestible substances in the market (by far), safer than foods in common form, FDA early on began a public relations blitz in which whenever a single incidence of abuse appeared, the agency trumpeted it loudly, complaining it to be characteristic of all supplements.  So effective was FDA in crying wolf that lawyers for the industry received the message and believed it.  They induced their clients to believe that the only way to combat the FDA’s cries of unregulated mayhem was for the industry to agree volitionally to grant FDA broad subjective discretion over every aspect of dietary supplement sourcing, production, storage, and distribution.  They came up with a draft GMP proposal and gave it to the FDA.  FDA could not believe its collective eyes.  Here was the industry giving the agency carte blanche to develop new rules that could permit the agency to crush the industry into oblivion.  FDA could now regulate, subjectively, every aspect of production, even of facility design, plumbing, and personnel.  Industry suddenly transferred sovereignty over everything, including the kitchen sink, to an already powerful and supplement antagonistic agency.

To be sure, certain leading industry advocates of the GMPs thought they would create beneficial anti-competitive barriers to entry and would cause smaller firms to go out of existence unable to afford the cost of the new rules.  When our firm produced for the Alliance for Natural Health an economic analysis by Emory University Professor of Law and Economics Joanna Shepherd Bailey, a different view began to take hold.  Professor Bailey crunched the numbers and explained that the GMPs would impose an enormous new, upwardly variable cost on the dietary supplement industry unrelated to the actual quality of the finished products produced.  Indeed, the cost was so high that even well healed firms would suffer and could never be sure that the rules might not be interpreted in ways that would put even them out of business.  Consequently, several who avowed support for this approach did an about face and submitted comments opposing the rules, but it was too late.

This year, 2013, is proving to be a bellwether year for GMP enforcement.  FDA’s Dan Fabricant has been vocal in his pronouncements that the industry is not cutting it when it comes to compliance.  He said that he finds widespread non-compliance and that agency tolerance is wearing thin.  He has made clear that more strenuous enforcement efforts are in the offing.  What more should the industry expect from FDA?

I suspect that the FDA will increasingly rely on its injunction and seizure powers to take precipitous legal action against companies that are deemed out of compliance with the GMPs.  There will of course be far more inspections than ever before because FDA enjoys increased funding for that purpose. For those who do not know of the GMPs and still manufacture without master manufacturing records, a quality control officer, SOPs, a complaint file, and signed and dated entries by qualified personnel of all complete steps and all corrective steps there will likely be little, if any, tolerance in the year ahead and much more brawn to agency enforcement. FDA is out for blood in 2013.

Consequently, mastery of the GMPs is a must for the little guys as it is for the big guys.  FDA has more money, and FDA is run by folks who think regulation the sine qua non of keeping what they regard as a renegade industry in check.  Word to the wise:  Act now before an investigation to get all of your ducks in a row because ducks not in a row will be shot.  Act now by having your operation reviewed top to bottom to ensure that each aspect of production is proper and is accompanied by contemporaneous recording of compliance.  Be ready for the next inspection with required records up-to-date and retrievable so that the investigator positioned at a computer station can readily access and review all required documents. Believe me the cost of complying in advance, while high, is far less than the cost of combatting the FDA in federal court (and the probability of prevailing as a defendant is slim indeed).  Moreover, making the life of the investigator less onerous often pays dividends in the form 483 department.

Although the axe is likely to fall hardest on the small firm owners, the FDA is also developing refined stilettos for use against larger players in the industry.  For those players who are presently selling products disfavored by the FDA, look out.  There will be increasingly reliance on GMP enforcement as a means to coerce and cajole big players into voluntary ceasing the sale of those products.  Moreover, the agency now expects good players to come forward with problems in advance of an inspection and to rely increasingly on voluntary recalls and reporting of adverse events in a cooperative manner with the agency.  There also lurks behind the curtain the threat that FDA will add to the record keeping inquiry proof of submission of structure/function claim notifications.

In short, the FDA is here to stay.  It abuses power.  The most commercially prudent course is to find a way to build a good relationship with the agency, particularly the agency investigators and district supervisors and directors who now possess the extraordinary power to initiate legal action without prior approval from the Chief Counsel’s office.  Those folks will come back to visit again and again.  There is no escaping them.  A good working relationship where achievable and sustainable is invaluable.  There will be instances when the agency’s abuse is intolerable, and we are pleased to take on the FDA at those times.  The prudent regulatee will in the normal course avoid conflict with the agency unless and until absolutely necessary, mindful that the FDA possesses many means to punish those it does not like.

Whether evaluating a concept, performing regulatory due diligence, maintaining or prosecuting regulatory filings, or contesting adverse litigation, Emord & Associates provides exceptional counsel for all your litigation and regulatory needs.

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