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    Columns

    What Level of Substantiation is Required for Your Claims?

    The appellate court decision in the Pom Wonderful case provides insight for marketers of foods and dietary supplements.

    What Level of Substantiation is Required for Your Claims?
    This decision raises important considerations for advertisers marketing foods and supplements with purported health benefits.
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    Todd Harrison, Michelle Jackson and Matthew Poliner, Venable04.01.15
    On Jan. 30, the U.S. Court of Appeals for the District of Columbia issued its long-awaited decision in Pom Wonderful, LLC vs. Federal Trade Commission. By way of background, the case arose after extensive administrative proceedings beginning in 2010 when the FTC filed an administrative complaint against Pom Wonderful, alleging the company made false, misleading and unsubstantiated representations about its products.

    Following an administrative trial in 2012 that found some (but not all) of POM’s advertisements and promotional materials contained implied health claims, both the FTC and POM appealed to the full Commission (the last stop before the federal Court of Appeals). POM argued it should not be held liable at all, while the Commission argued that additional claims (above and beyond the original 19 cited) were false or misleading. 

    In January 2013, the full Commission voted to hold POM liable for violating the FTC Act and ordered the company to cease and desist making misleading and inadequately supported claims about the health benefits of its products. For example, POM advertised that “POM Wonderful Pomegranate Juice has been proven to promote cardiovascular health”; “New Research Offers Further Proof of the Heart-Healthy Benefits of POM Wonderful Juice”; and “Drinking 8 ounces of POM Wonderful pomegranate juice daily prolonged post-prostate surgery PSA double time from 15 to 54 months.”

    Interestingly, four of the five commissioners believed that 36—not 19, as the administrative law judge found—of POM’s advertisements and promotional items made false or misleading claims. The Commission also forbade POM from running ads relating to the treatment or prevention of diseases unless the company possessed at least two randomized, controlled, human clinical studies (RCTs) demonstrating statistically significant results. 

    POM petitioned the Court of Appeals for review of the FTC’s decision, arguing that the FTC order violated: 1) the FTC Act; 2) the Administrative Procedure Act (APA); and 3) the First Amendment to the U.S. Constitution.

    Appellate Decision
    In deciding these issues, the Court of Appeals highlighted FTC’s “special expertise” in determining what sort of substantiation is necessary to avoid consumer deception and the extensive administrative proceedings already completed. The court agreed with FTC’s view and believed that POM’s advertisements crossed the line into deceptive advertising. However, the court referenced the FTC’s determination that if POM had used an effective disclaimer (i.e., that “evidence in support of this claim is inconclusive”), a different result might have been reached. Indeed, the court stated that “[a]n advertiser thus still may assert a health-related claim backed by medical evidence falling short of an RCT if it includes an effective disclaimer disclosing the limitations of the supporting research.” This is an important statement and should not be overlooked.

    POM’s advertising failed to point out numerous shortcomings in its claim substantiation and therefore made itself an easy target for the FTC. Had POM’s claims been appropriately qualified, a different outcome very well could have occurred in the Court of Appeals. Additionally, the court agreed with the FTC’s view of RCTs, namely, that the need for RCTs is driven by the claims made for products.

    The court stated that if the cost of these studies proves to be prohibitive, then a company can choose to make claims that require a lower level of substantiation (i.e., claims that do not assert a causal relationship, claims that use an appropriate disclaimer to disclose the limitations of the science, or claims that refrain from referencing “studies”). Finally, the court upheld the FTC’s decision to hold a company executive individually liable for POM’s deceptive acts and practices because an individual can be held liable for FTC Act violations if they “participated directly in the deceptive practices or acts or had authority to control them.”

    POM also argued the substantiation standard applied by the Commission constituted a new legal rule that violated the APA’s notice-and-comment requirements for rulemaking. The court disagreed, however, concluding that the FTC “validly proceeded by adjudication” because an order that may affect agency policy does not automatically constitute rulemaking. Additionally, the court did not believe that FTC’s decision constituted a “‘major substantive legal addition’ to its substantiation standards.” 

    RCT Substantiation
    Finally, the court considered POM’s argument that the Commission violated the First Amendment through its liability determination and remedy.

    Under the Central Hudson scrutiny test (the general standard applied to commercial speech), the court evaluated whether the requirement of some RCT substantiation for disease claims “directly advances, and is not more extensive than necessary to serve, the interest in preventing misleading commercial speech.” Here, the court determined that some RCT substantiation was necessary for these disease claims. The court highlighted that because POM’s past claims were deceptive in the absence of RCTs, it was acceptable to require RCTs for future claims, as this was “tightly tethered to the goal of preventing deception.” However, this was narrowly tailored to this specific situation due to POM’s previous deception.

    The court believed the FTC’s rigid requirement of two RCTs as an across-the-board requirement for any disease claim that POM might make in the future was unconstitutional. In particular, the court found the rigid requirement was not a “reasonable fit” under the Central Hudson test, making it clear that FTC attempts to regulate advertising should be strictly limited by the First Amendment. While two RCTs would provide more certainty than one RCT, three RCTs would provide more certainty than two (and so on).

    The court discussed a hypothetical situation where a large-scale RCT demonstrated that a dietary supplement significantly reduced the risk of a specific disease to a very high degree of certainty and where the RCT was reinforced by a wealth of non-RCT medical evidence. The court believed that in this hypothetical case, there exists a substantial interest in raising awareness in consumers—and that a two-RCT requirement would provide for no exceptions for circumstances such as these.

    The court also found it persuasive that FTC’s own expert testimony weighed against imposing a categorical, two-RCT requirement for all disease claims and that FTC had previously required less than two RCTs in certain other cases (and, indeed, sometimes had not even required one RCT—just the baseline of “competent and reliable scientific evidence”). However, the court warned this ruling did not bar FTC from ever imposing a two RCT substantiation requirement.       

    Advertising Implications
    This decision raises important considerations for advertisers, and in particular those marketing foods and dietary supplements with purported health benefits. The decision demonstrates the importance of appropriately qualifying health-related claims. It also emphasizes the importance of possessing at least one RCT for health-related claims—and depending on the extent of claims, potentially more than one RCT (e.g., for claims lacking qualification).

    Indeed, following publication of the decision, FTC announced victory and noted that at some point in the future, a two-RCT requirement might be warranted. The case can be used to illustrate that courts may be reluctant to uphold the FTC’s application of RCT standards for generalized claims, as compared to specific disease-related claims, as long as appropriate studies exist to support the claims. Finally, it reminds advertisers that proper substantiation of claims is decided on a case-by-case basis. It is therefore ultimately the decision of individual companies to decide the risk level they are comfortable with in their advertising and ensuring that proper substantiation exists. 




    Proposed Actions to Calm the Attorney General Storm
    Transparency can play a crucial role in winning the public debate.

    New York Attorney General Eric Schneiderman has recently caused quite a stir by testing certain dietary supplement products made by some of the industry’s leading manufacturers and sold by major retailers in the U.S. under their own store brands. 

    The AG, to date, has refused to share test results with the industry and has issued subpoenas to manufacturers, which has created the appearance that this is all just a witch hunt. While the industry has a right to be concerned about the heavy-handed tactics of the AG, it must also recognize that attorneys general play an important role in consumer protection in their own state.

    Federal law does not preempt the AG’s actions; so we need to drop this avenue of attack. Moreover, often times, where there is smoke there is also fire. This time, however, some of the fire can be squarely laid at the feet of FDA. Yet, nobody appears to be discussing this issue. Instead, we as an industry have been accusing the AG, who currently holds most of the cards, of malfeasance.

    Thus, I propose some actions that could swiftly reassure consumers and the AGs that the dietary supplement industry is committed to providing consumers with safe products that meet label claim: 

    1) Industry should call on FDA to immediately issue a rule requiring all ingredient manufacturers and suppliers to be subject to the dietary supplement cGMPs, including but not limited to heavy metal, microbial and identity testing (the Food Safety Modernization Act, FSMA, at this point is not addressing this issue as it should have). 

    2) Manufacturers should immediately take steps in the interim to require their suppliers to meet cGMPs, provide appropriate testing and to validate their suppliers (the best manufacturers already require it).

    3) Implement supply chain traceability standards (this is required under FSMA), as the Organic and Natural Health Association is the only organization that is actually making this a pillar of membership.

    4) Only use identity testing that is validated (if we are going to complain about the AG’s test method, we should ensure that our test methods are likewise validated—this requirement is particularly important for botanicals).

    5) Any company that markets a private label product, including retailers, should do their due diligence to ensure the products they are marketing meet label claims—this means trust but verify. In other words, inspect your contract manufacturers and routinely test and send your finished products for independent validation.   

    Will these steps eliminate all issues? Of course not, because, unfortunately, all industries have rogue players; but if the industry takes this initiative then maybe we can finally be on the winning side of the public debate, rather than looking like we are whining. We are a good industry dedicated to excellence, but sometimes our own lack of transparency hurts us. These steps are not radical, and are what the majority of the industry believes in already, but our own lack of transparency works against us when we complain about a government agency’s lack of transparency. —Todd Harrison


    Todd Harrison
    Venable

    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.

    Michelle Jackson
    Venable

    Michelle Jackson’s practice is focused on regulatory counseling concerning the development, formulation, manufacture, distribution and promotion of foods, dietary supplements, drugs, medical devices and cosmetics. She handles matters involving regulation and enforcement by federal and state agencies.

    Matthew Poliner
    Venable

    Matthew Poliner is an associate in Venable’s Regulatory Group where he advises clients on a variety of regulatory compliance and enforcement matters. He focuses primarily on FDA and advertising laws and regulations. 
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