FDA Says Herbalife Video Misleading

WASHINGTON—A government official on Wednesday rebuked Herbalife, expressing concern that a senior vice president of the company—who previously ran FDA’s supplement division—misrepresented the agency’s oversight over natural products.

Michael Taylor, FDA Deputy Commissioner for Foods and Veterinary Medicine, expressed concern that Herbalife had misled consumers in a YouTube video and broadcast advertisement into believing whether the agency has determined the company’s products are effective and safe.

“The agency has made no such determination," declared Taylor in a letter to Herbalife Chief Executive Michael Johnson.

Taylor requested Herbalife “remove the video from YouTube and refrain from airing it on other media." The video that FDA references on YouTube is marked as private. Taylor specifically referenced the following statement made by Vasilios Frankos, Ph.D.: “When I was director of dietary supplements at the FDA, I oversaw nutritional supplements, making sure they were safe and effective for use."

Frankos, Herbalife’s senior vice president, global product science, safety and compliance, joined the company in 2010 after serving as FDA’s top supplement official.

Taylor said the Herbalife video in which Frankos is quoted refers to a safety standard that applies to FDA’s review of drugs, not dietary supplements.

Dietary supplements are not subject to FDA premarket approval before they can be marketed, and FDA generally has no authority to review the products for effectiveness before they are marketed, Taylor said.  

In the letter, Taylor stated: “Similarly, FDA is not authorized to and does not review dietary supplements for safety before they are marketed, except for those that contain a new dietary ingredient that has not been present in the food supply as an article of food used for food in a form in which the food has not been chemically altered. Even then, FDA does not have authority to approve or disapprove marketing based on safety and can stop marketing only by proving to a court there is inadequate information to provide reasonable assurance that the new dietary ingredient does not present a significant or unreasonable risk of illness or injury."

Herbalife responded to FDA's letter.  

“Herbalife’s number one priority is producing the highest quality products possible. We take this responsibility very seriously and this is the reason Dr. Vasilios Frankos came to Herbalife after leading FDA’s Dietary Supplement Program," said Alan Hoffman, executive vice president of Herbalife's Global Corporate Affairs, in a statement. "All of the statements Dr. Frankos made in the advertisement in question were accurate and true. The only message Herbalife was conveying is that Dr. Frankos uses the 14 years of experience he gained at the FDA to ensure that Herbalife’s products are safe, efficacious and of the highest quality. Nothing more, nothing less.”

The letter comes at a bad time for Herbalife, which is under investigation by state and federal authorities after a billionaire, William Ackman of the hedge fund Pershing Square Capital Management, publicly accused the company of operating a massive pyramid scheme that is destined to collapse. Herbalife has repeatedly denied the allegations.

Taylor also sent the letter to Richard Cleland, the FTC’s assistant director of advertising practices in the Bureau of Consumer Protection. The FTC is investigating Herbalife following Ackman’s accusations that Herbalife exploits its low-income distributors and heavily rewards them based on their recruitment rather than actual sales of weight-loss shakes and other products to customers outside the network. Herbalife has said most of its distributors—now known as members—purchase the products for their own consumption.

Herbalife’s Compliance with FDA Regulations

While Herbalife doesn’t need FDA premarket approval in order to sell its products, the company and other dietary supplement firms are bound by cGMPs (current good manufacturing practices) that are intended to ensure products are produced in accordance with established guidelines. In fiscal year 2013, FDA cited the company for 13 “observations" or violations of FDA regulations following an inspection of the company’s facilities, according to data Natural Products INSIDER obtained from FDA based on a Freedom of Information Act request.

Only two of the 13 observations related to supplement cGMPs, Herbalife told INSIDER early this year, and the reported infractions concerned failures to cross-reference certain procedures and records. Herbalife contended the supplement observations were relatively minor ones, and the company said it made changes to correct the observations.

The majority of observations at Herbalife's facilities concerned regulations of acidified foods. Herbalife executives explained they were still in the process of updating their facilities to fully comply with the acified food regulations at the time of the weeks-long inspection. Herbalife said it had only recently discovered prior to the inspection that FDA was subjecting liquid aloe products to acidified food regulations rather than supplement cGMPs.

“Herbalife is unwavering in its commitment to GMPs and manufacturing products of the very highest quality. The enforcement of GMPs and manufacturing standards is vital in raising the standards and perceptions of the industry as a whole," Frankos said earlier this year in a statement to INSIDER.  

FDA data from FY 2008 through FY 2013 indicates FDA has not recommended any official enforcement action against Herbalife or any other dietary supplement firm with at least 500 employees.

In recent years, FDA has cited the majority of dietary supplement firms for at least a few observations following an inspection for compliance with cGMPs and other regulations. In FY13, 270 dietary supplement firms, or 65 percent of the businesses inspected, received a government document (Form 483) that reflects alleged violations of cGMPs following an FDA inspection. FDA inspectors reported 1,913 observations on the Form 483s, or an average of 7.1 alleged infractions of cGMPs for each company. As was the case with Herbalife, an unspecified number of the observations may relate to FDA food regulations.