By Todd Harrison, Partner, Venable LLP01.10.24
With the start of the New Year, let’s discuss claims and claims substantiation. This article is not meant to get into the meat of claims substantiation but is intended as a simplified version spoken in plain English. This article will touch upon the Federal Trade Commission (FTC), Food and Drug Administration (FDA), National Advertising Division (NAD) of the BBB National Programs, state regulators, and private litigation.
“Advertising” is a broad term that encompasses print and broadcast ads, infomercials, catalogs, internet website promotional materials, social media promotional materials (e.g., a company’s Facebook page), and similar direct marketing materials.
The FTC is empowered to investigate and bring enforcement actions against companies, and the agency’s authority in this regard is quite broad. The agency may secretly investigate a company, informally ask a company for information, or issue a Civil Investigative Demand, which is a formal request for information, documents, reports, testimony, etc., similar to a subpoena. The ultimate goal of the investigation is not simply to extract a monetary component but also to place the company under a consent decree as a means of ensuring future compliance.
The FTC requires advertisers to have a “reasonable basis” for their claims in the form of “competent and reliable scientific evidence” (CARSE) prior to the dissemination of the claim. This is typically defined as “tests, analyses, research, studies, or other evidence based on the expertise of professionals in the relevant area, that have been conducted and evaluated in an objective manner by persons qualified to do so, using procedures generally accepted in the profession to yield accurate and reliable results.”
Related Reading: Understanding FTC’s Warning to Industry: Considerations for the Natural Products Industry
In general, the FTC requires that health-related claims be substantiated in the form of clinical studies or other scientific studies on humans published in peer-reviewed journals. There is no requirement that a study needs to be peer-reviewed as there are myriad reasons why a sponsor of a study would choose not to publish. The foremost reason is that competitors could simply copycat a product and rely on the published study to support claims. The real issue is whether the study is conducted in a credible manner.
In deciding whether a particular study or studies substantiate a performance claim, the scientific quality of the studies is important, including the study type (intervention v. observational), study population, study design and conduct (e.g., randomization, presence of a placebo control), data collection, statistical analysis, and outcome measures.
The “gold standard” is a randomized, double-blind, parallel-group, placebo-controlled clinical trial. The study or studies must also be consistent with the recommended dosage, route of administration, directions for use, etc. of the product at issue. It is very important that the studies “match” the product and that the advertiser possesses the level of substantiation claimed in the ad.
For instance, a study done on the actual product is preferable to studies testing some of the ingredients or similar products. If the study is not conducted on the actual product advertised, the FTC will look at whether the studies used the same ingredients, in the same dosage amounts, as are used in the advertised product.
The FTC will also look at the study population, directions for use, route of administration, etc. to determine whether a study presents adequate substantiation for a product claim. For so-called “establishment claims”—claims that reference a specific level of substantiation, such as “clinically proven”—the advertiser must possess the level of substantiation cited in the claim.
The following additional types of information are generally considered background information, but alone may not be adequate to substantiate a claim: animal studies; in vitro studies; testimonials and other anecdotal evidence; meta-analyses (the process of systematically combining and evaluating the results of clinical trials that have been completed or terminated); review articles; comments and Letters to the Editor; and product monographs. This is not to say that these studies do not serve a purpose, as often they will describe the mechanism of action of a particular ingredient or formulation. Thus, they do add to the totality of the evidence in support of a claim.
As noted, the FTC requires that an advertiser have the studies in its possession before it makes any claims about the product. It is not enough that the study is being conducted or has been conducted and you are awaiting the report of the results; you must actually create a file containing the studies to substantiate each claim you wish to make before you make the claim.
Administrative actions include product recalls and withdrawal of facility registration, while judicial actions include seizures of products, injunctions, criminal prosecutions, and certain civil money penalties.
Related Reading: FDA Restructuring
FDA has primary responsibility for claims on product labeling, including packaging, inserts, and other promotional materials distributed at the point of sale. This is somewhat misleading, however, because the FDA takes the position that it may use claims made in advertising as evidence of the intended use of the product, which has a direct effect on the product’s regulatory classification. Thus, in effect, FDA’s reach goes far beyond product labeling. In the event that a manufacturer makes an impermissible claim for a dietary supplement (i.e., a claim that either lacks proper substantiation or fails to comply with FDA’s regulations) the most likely course of action is for FDA to issue a Warning Letter. Such Warning Letters are publicly available and, in the past, have drawn additional regulatory or legal action, including an inspection by FDA to confirm that the issue has been corrected or potentially follow-on consumer class actions discussed in more detail below.
FDA has generally adopted the same “competent and reliable scientific evidence” standard as the FTC and looks to accepted norms in the relevant research field to evaluate the meaning of the claim in relation to the quality and totality of the evidence supporting it.
Specifically, FDA will evaluate whether the cited studies specify and measure the dietary supplement and nutritional deficiency, structure/function, or general wellbeing that is subject to the claim. FDA also considers whether the population studied in the claim is similar to that which will consume the dietary supplement and whether the claim accurately conveys the extent, nature, or permanence of the advertised effect.
Finally, when making structure/function claims, it is important to avoid implicitly or explicitly indicating that the dietary supplement is intended to “diagnose, mitigate, treat, cure, or prevent disease (other than a classical nutrient deficiency disease).”1 Such claims are considered “disease claims” by FDA and render the product a “drug” that necessitates a new drug application.
FDA considers the name of the product, statements about its formulation (including claims about specific ingredients in the product), citation to publications or references, use of the term “disease,” use of pictures, vignettes, symbols, and other means when making its determination.
It should be noted that FDA rarely raises substantiation issues. Rather, the agency generally only challenges claims that it believes are impermissible disease claims.
The challenger’s and advertiser’s positions, NAD’s or the Electronic Retailing Self-Regulation Program’s (ERSP) decision, and a statement by the advertiser are made public. Reviews are conducted by attorneys with expertise in claims substantiation, advertising and trade regulation, litigation, and arbitration. While compliance with NAD and ERSP decisions is voluntary, it is in a company’s best interest to comply with the decision; if a company refuses to make the recommended changes, the NAD will turn the case over to the FTC, and the case will be on the top of the FTC’s list for enforcement consideration. NAD considers many dietary supplement cases each year.
NAD has reiterated several well-established principles regarding product advertising. Generally, “product performance claims should be supported by competent and reliable evidence, with the gold standard being testing on the product itself.” Further, when the only substantiation cited relates to the efficacy of ingredients in a product, but not for the product itself, the advertising must not suggest or imply that the product provides the claimed benefits; rather, the claims must be clearly expressed as ingredient claims.2
NAD also requires advertisers to possess competent and reliable scientific evidence to substantiate advertising claims prior to such claims being made.
The precise requirements and elements of such consumer suits vary depending on state law, but certain states are considered more “plaintiff friendly” than others and therefore draw a more significant amount of class action litigation.
For instance, California is particularly active in class action litigation concerning dietary supplements. Plaintiffs typically allege violations of California’s Unfair Competition Law (UCL), Consumer Legal Remedies Act (CLRA), and/or False Advertising Law (FAL). In evaluating a claim under the UCL and CLRA, courts are guided by the “reasonable consumer” test, under which a plaintiff must show that members of the public are likely to be deceived.
Importantly, claims that rest on a lack of substantiation, instead of provable falsehood, are not cognizable under the California consumer protection laws. Challenges based on a lack of substantiation are left to the attorney general and other prosecuting authorities; private plaintiffs, in contrast, have the burden of proving that advertising is actually false or misleading.
About the Author: Todd Harrison is Partner with Venable, which is located in Washington, D.C. He advises food and drug companies on a variety of FDA and FTC matters, with an emphasis on dietary supplement, functional food, biotech, legislative, adulteration, labeling and advertising issues. He can be reached at 575 7th St. NW, Washington, D.C. 20004, Tel: 202-344-4724; E-mail: taharrison@venable.com.
The Federal Trade Commission
As the primary federal agency responsible for policing advertising, the FTC and its approach to claims substantiation is generally how we view claims substantiation.“Advertising” is a broad term that encompasses print and broadcast ads, infomercials, catalogs, internet website promotional materials, social media promotional materials (e.g., a company’s Facebook page), and similar direct marketing materials.
The FTC is empowered to investigate and bring enforcement actions against companies, and the agency’s authority in this regard is quite broad. The agency may secretly investigate a company, informally ask a company for information, or issue a Civil Investigative Demand, which is a formal request for information, documents, reports, testimony, etc., similar to a subpoena. The ultimate goal of the investigation is not simply to extract a monetary component but also to place the company under a consent decree as a means of ensuring future compliance.
The FTC requires advertisers to have a “reasonable basis” for their claims in the form of “competent and reliable scientific evidence” (CARSE) prior to the dissemination of the claim. This is typically defined as “tests, analyses, research, studies, or other evidence based on the expertise of professionals in the relevant area, that have been conducted and evaluated in an objective manner by persons qualified to do so, using procedures generally accepted in the profession to yield accurate and reliable results.”
Related Reading: Understanding FTC’s Warning to Industry: Considerations for the Natural Products Industry
In general, the FTC requires that health-related claims be substantiated in the form of clinical studies or other scientific studies on humans published in peer-reviewed journals. There is no requirement that a study needs to be peer-reviewed as there are myriad reasons why a sponsor of a study would choose not to publish. The foremost reason is that competitors could simply copycat a product and rely on the published study to support claims. The real issue is whether the study is conducted in a credible manner.
In deciding whether a particular study or studies substantiate a performance claim, the scientific quality of the studies is important, including the study type (intervention v. observational), study population, study design and conduct (e.g., randomization, presence of a placebo control), data collection, statistical analysis, and outcome measures.
The “gold standard” is a randomized, double-blind, parallel-group, placebo-controlled clinical trial. The study or studies must also be consistent with the recommended dosage, route of administration, directions for use, etc. of the product at issue. It is very important that the studies “match” the product and that the advertiser possesses the level of substantiation claimed in the ad.
For instance, a study done on the actual product is preferable to studies testing some of the ingredients or similar products. If the study is not conducted on the actual product advertised, the FTC will look at whether the studies used the same ingredients, in the same dosage amounts, as are used in the advertised product.
The FTC will also look at the study population, directions for use, route of administration, etc. to determine whether a study presents adequate substantiation for a product claim. For so-called “establishment claims”—claims that reference a specific level of substantiation, such as “clinically proven”—the advertiser must possess the level of substantiation cited in the claim.
The following additional types of information are generally considered background information, but alone may not be adequate to substantiate a claim: animal studies; in vitro studies; testimonials and other anecdotal evidence; meta-analyses (the process of systematically combining and evaluating the results of clinical trials that have been completed or terminated); review articles; comments and Letters to the Editor; and product monographs. This is not to say that these studies do not serve a purpose, as often they will describe the mechanism of action of a particular ingredient or formulation. Thus, they do add to the totality of the evidence in support of a claim.
As noted, the FTC requires that an advertiser have the studies in its possession before it makes any claims about the product. It is not enough that the study is being conducted or has been conducted and you are awaiting the report of the results; you must actually create a file containing the studies to substantiate each claim you wish to make before you make the claim.
The Federal Food and Drug Administration
The FDA is charged with ensuring the safety and effectiveness of, among other things, dietary supplements sold in the U.S. Accordingly, the FDA has authority to take both administrative and judicial actions (via the U.S. Department of Justice (DOJ)) to protect the public from dangerous and illegal products, to punish persons and companies who violate the law (acting through the DOJ), and to deter violations.Administrative actions include product recalls and withdrawal of facility registration, while judicial actions include seizures of products, injunctions, criminal prosecutions, and certain civil money penalties.
Related Reading: FDA Restructuring
FDA has primary responsibility for claims on product labeling, including packaging, inserts, and other promotional materials distributed at the point of sale. This is somewhat misleading, however, because the FDA takes the position that it may use claims made in advertising as evidence of the intended use of the product, which has a direct effect on the product’s regulatory classification. Thus, in effect, FDA’s reach goes far beyond product labeling. In the event that a manufacturer makes an impermissible claim for a dietary supplement (i.e., a claim that either lacks proper substantiation or fails to comply with FDA’s regulations) the most likely course of action is for FDA to issue a Warning Letter. Such Warning Letters are publicly available and, in the past, have drawn additional regulatory or legal action, including an inspection by FDA to confirm that the issue has been corrected or potentially follow-on consumer class actions discussed in more detail below.
FDA has generally adopted the same “competent and reliable scientific evidence” standard as the FTC and looks to accepted norms in the relevant research field to evaluate the meaning of the claim in relation to the quality and totality of the evidence supporting it.
Specifically, FDA will evaluate whether the cited studies specify and measure the dietary supplement and nutritional deficiency, structure/function, or general wellbeing that is subject to the claim. FDA also considers whether the population studied in the claim is similar to that which will consume the dietary supplement and whether the claim accurately conveys the extent, nature, or permanence of the advertised effect.
Finally, when making structure/function claims, it is important to avoid implicitly or explicitly indicating that the dietary supplement is intended to “diagnose, mitigate, treat, cure, or prevent disease (other than a classical nutrient deficiency disease).”1 Such claims are considered “disease claims” by FDA and render the product a “drug” that necessitates a new drug application.
FDA considers the name of the product, statements about its formulation (including claims about specific ingredients in the product), citation to publications or references, use of the term “disease,” use of pictures, vignettes, symbols, and other means when making its determination.
It should be noted that FDA rarely raises substantiation issues. Rather, the agency generally only challenges claims that it believes are impermissible disease claims.
The National Advertising Division (NAD) of the BBB National Programs
The National Advertising Division (NAD) of the BBB National Programs is a self-regulatory forum that settles advertising disputes. On their own initiative or through a competitor challenge, these entities review claims in product advertising to ensure proper substantiation exists.The challenger’s and advertiser’s positions, NAD’s or the Electronic Retailing Self-Regulation Program’s (ERSP) decision, and a statement by the advertiser are made public. Reviews are conducted by attorneys with expertise in claims substantiation, advertising and trade regulation, litigation, and arbitration. While compliance with NAD and ERSP decisions is voluntary, it is in a company’s best interest to comply with the decision; if a company refuses to make the recommended changes, the NAD will turn the case over to the FTC, and the case will be on the top of the FTC’s list for enforcement consideration. NAD considers many dietary supplement cases each year.
NAD has reiterated several well-established principles regarding product advertising. Generally, “product performance claims should be supported by competent and reliable evidence, with the gold standard being testing on the product itself.” Further, when the only substantiation cited relates to the efficacy of ingredients in a product, but not for the product itself, the advertising must not suggest or imply that the product provides the claimed benefits; rather, the claims must be clearly expressed as ingredient claims.2
NAD also requires advertisers to possess competent and reliable scientific evidence to substantiate advertising claims prior to such claims being made.
State Agencies
States also have the authority to regulate product advertising through their own Attorneys General (AG) office; in some states, the county District Attorney has the same power. Each state has a division dedicated to consumer protection, charged with ensuring adequate substantiation exists for claims made in product advertising. The state agencies enforce various consumer protection statutes and have the authority to file lawsuits against companies for unfair and/or deceptive advertising.Private Litigants
In addition to government regulation, competitors or consumers may bring their own lawsuits against a company. Competitors typically bring suit via the federal Lanham Act. Consumers can act through state consumer protection and false advertising statutes on their own behalf or on the behalf of others through a class action.The precise requirements and elements of such consumer suits vary depending on state law, but certain states are considered more “plaintiff friendly” than others and therefore draw a more significant amount of class action litigation.
For instance, California is particularly active in class action litigation concerning dietary supplements. Plaintiffs typically allege violations of California’s Unfair Competition Law (UCL), Consumer Legal Remedies Act (CLRA), and/or False Advertising Law (FAL). In evaluating a claim under the UCL and CLRA, courts are guided by the “reasonable consumer” test, under which a plaintiff must show that members of the public are likely to be deceived.
Importantly, claims that rest on a lack of substantiation, instead of provable falsehood, are not cognizable under the California consumer protection laws. Challenges based on a lack of substantiation are left to the attorney general and other prosecuting authorities; private plaintiffs, in contrast, have the burden of proving that advertising is actually false or misleading.
About the Author: Todd Harrison is Partner with Venable, which is located in Washington, D.C. He advises food and drug companies on a variety of FDA and FTC matters, with an emphasis on dietary supplement, functional food, biotech, legislative, adulteration, labeling and advertising issues. He can be reached at 575 7th St. NW, Washington, D.C. 20004, Tel: 202-344-4724; E-mail: taharrison@venable.com.
References
1. 21 CFR § 101.93(g).
2. See Heartland Sweeteners, LLC and Ganeden Biotech, Inc., Nevella with Probiotics, NAD Case No. 5203 (Aug. 2010).
