Weekly News Update
Published: Monday, October 01, 2001
Two New Supplements Bills Introduced; CRN Asks for Careful Assessment
Rep. Susan A. Davis, D-Calif., has introduced two new bills, which aim to modify the legal framework for dietary supplements. HR 3065, The Dietary Supplement Education Act, focuses primarily on manufacturer and product registration with FDA, mandatory adverse event reporting, consumer reporting, postmarket surveillance, inspection authority and good manufacturing practices. The registration portion of the bill would require all manufacturers, packers and distributors of dietary supplements to register with FDA as well as submit a sample product label. It also gives FDA the authority to establish product registration regulations including a registration fee. Additionally, any adverse events resulting from the use of a dietary supplement would be required to be reported to FDA within 15 days. If a supplement is determined to have serious health consequences, FDA could require the manufacturer to conduct postmarket surveillances of the product.
The second bill, HR 3066, The Ephedrine Alkaloid Consumer Protection Act, would require a warning label on all products containing ephedrine alkaloids and a standardized nomenclature for the ephedrine ingredient to make it clear to consumers that the product contains ephedrine. Caffeine levels and/or other stimulant levels would also be required on the labels. In addition to the warning label, the bill outlines specific restrictions on radio, television, and non-label advertising, including a notice alerting consumers that a product contains ephedrine. Finally, the bill places a ban on the sale of ephedrine to individuals under the age of 18.
In response to the bills, the Washington-based Council for Responsible Nutrition (CRN) issued a statement that the introduction of any legislation changing the basic framework of existing dietary supplement regulation should be closely monitored, and warning that it must ""solve real problems, and the use of scarce resources--people and dollars--must be consistent with the highest priority for enforcement action that ensures consumers' continued access to safe products made to quality standards, and useful science-based information."" CRN also noted that it advocates the already existing partnership between FDA and the industry to remedy issues addressed in the bills and encourages FDA to implement previously proposed actions regarding mandatory regulation of ephedrine, which are consistent with the Dietary Supplement Health and Education Act (DSHEA). Such actions would render the new legislation unnecessary, the group says.
More Supplements Regulation News
The Washington-based Consumer Healthcare Products Association has submitted its three-part ""Dietary Supplement Ingredient Safety Review"" to the Institute of Medicine, a branch of the National Academy of Sciences in Washington. The report includes suggestions for a system for post-marketing safety reviews of safety issues, ongoing safety reviews to guard against potential toxicity in currently marketed products, and a prospective pre-marketing safety review system for new supplements that require 75-day notifications. A copy of the recommendations can be viewed under the ""News"" section at www.chpa-info.org.
Also, the Dietary Supplement Education Alliance has formed a fundraising committee naming Deb Knowles, DSEA's administrative manager, as chair. The group is seeking people to help with mailings, phone calls, asking for pledges, as well as other administrative tasks. For more information email: debknowles@home.com or contact Elliot Balbert, 818.739.6000.
U.S. Organic Market Shows 38 Percent Growth, OTA Study Says
The Greenfield, Mass.-based Organic Trade Association has released its ""2001 Manufacturers Market Survey,"" conducted by Arcata, Calif.-based Starr Track, which reports that sales for U.S.-manufactured organic products grew 38 percent in the past year. Soyfoods and other meat/dairy alternatives were the fastest growing, registering 215 percent growth between 1999-2000, with 94 percent projected growth for 2000-2001. The survey also tracked retail-outlet penetration for branded products from manufacturers and processors and showed that the most dramatic shift was to mass-market channels. In 2001, less than half (49 percent) of food manufacturers' product distribution moved through health and natural food stores, a drop of 13 percent from 1998. Copies of the survey are available for $50. Contact 413.774.7511 or info@ota.com.
Separately, OTA has published a multi-language brochure called ""Buying Organic Products from the United States."" The brochure will be distributed through domestic and international trade shows to promote the American organic market.
Finally, more than 75 OTA members met with congressional representatives in Washington on Oct. 12 during the association's lobbying and education day. Sens.Thad Cochran, R-Miss., Patrick Leahy, D-Vt., and Rep. Dennis Kucinich, D-Ohio, met with the group. Key issues included fair appropriations for organic production, relief from existing federal marketing orders, and support for legislation requiring labeling of genetically modified (GM) foods.
Hemp Industry to Fight New DEA ""Zero Tolerance"" Regulations
The Hemp Industries Association on October 16 filed a ""Stay Pending Review"" in the 9th Circuit Court of Appeals to combat new Drug Enforcement Agency (DEA) regulations, which mandate a ""zero tolerance"" for THC in food and topical products containing hemp. The association says it plans to litigate the case on ""substantive issues"" if, after reviewing public comment, DEA continues to implement the rules. To reassure customers that members of the association's products are safe, the group reported that all of its hemp food company members comply with the official Health Canada testing protocol for detectable levels of THC in their products. Because DEA has not set a ""de minimums"" limit on detection the association says it must follow through with the stay.
Advocacy Groups Continue Fight for Revised Farm Bill
More than 200 trade and consumer groups have united to keep the House's version of the new farm bill (H.R. 2646) from being used as a starting point for the Senate's version of the bill and ensuing deliberation. Groups such as the Center for Food Safety, Greenpeace U.S.A., the Independent Organic Inspectors Association, the Land Stewardship Project are urging Senate Agriculture Committee chair Tom Harkin, D-Iowa, and ranking minority member Richard Lugar, R-Ind., to reject the farm bill passed in the House.
""HR 2646 will spend an estimated $170 billion over the next ten years on various agriculture programs. The bulk of this money will be spent on wasteful subsidies for big agribusiness at the expense of family farmers, who will be put at further economic disadvantage if this bill passes,"" said Kathy Lawrence of the National Campaign for Sustainable Agriculture. For more information on the bill contact Lawrence at 845.744.8448.
Sen. Richard Lugar, R-Ind., could be unveiling his new proposal for the final Senate version of the Farm Bill as early as next week. Though he declined to publicize details, insiders say Lugar's plan would guarantee an annual payment to any farmer who agrees to adopt specific risk management and conservation practices, including producers of fruits, vegetables, and livestock. The plan allows for $2 billion to be spent on conservation and $1 billion on nutrition programs each year. The cap on the Conservation Reserve would remain at 36.4 million acres, with four million acres reserved for water quality projects. Additionally, 250,000 acres per year would be allowed into the Wetlands Reserve. Finally, Lugar plans to include grasslands within the Farmland Protection Program, which would receive $65 million a year. Accordingly, the Wildlife Habitat Incentives Program would be entitled to $50 million annually.
Nutritional Value of Organic Crops Demonstrated in Study
A recent study published in the Journal of Alternative and Complementary Medicine showed significantly higher levels of nutrients in organic crops than in conventional crops, with levels of vitamin C 27 percent higher, iron 21.1 percent higher, magnesium 29.3 percent higher, and phosphorus 13.6 percent higher. The results also showed lower levels of harmful nitrates in organic crops, with an average of 15.1 percent less than in conventional crops. Other findings include better protein composition and lower content of toxic heavy metals in organic foods. For more information visit www.foodisyourbestmedicine.com/organic.pdf.
Antioxidants and Minerals Could Reduce Risk of Eye Disease
The National Eye Institute (NEI), a part of the National Institutes of Health, announced the results of its Age-Related Eye Disease Study (AREDS) at a news conference on Oct. 12. In the study, 4,757 people, ages 55 to 80, were observed for 6.3 years in an attempt to determine the effects of antioxidant supplements, zinc, or both on the reduction in the risk of advanced-stage-age related macular degeneration. Researchers found that a mixture of vitamin C, vitamin E and beta-carotene reduced the risk of vision loss by 10 percent; the minerals zinc and copper reduced risk by 11 percent; and both antioxidants and minerals reduced risk by 19 percent. Details of the study are published in the October edition of Archives of Ophthalmology and the news conference can be downloaded at www.nei.nih.gov/amd.
M&A Activity
Santa Fe, N.M.-based, privately held Santa Fe Natural Tobacco Co., maker of Natural American Spirit cigarettes, has been purchased by Canadian cigarette manufacturer Rothmans Inc. (ROC.TO), for approximately $275 million. The purchase price includes $105 million in cash, 4.2 million common shares of Rothmans at a value of $65 million, and $105 million in bonds to be issued by Santa Fe and repaid over four years from Santa Fe's operating cash flows, according to ROC.TO. Santa Fe Natural Tobacco had sales of $99.6 million for FY00, according to The Santa Fe New Mexican. The merger should be finalized in January 2002.
U.K.-based organic and natural brown sugar supplier Edward Billington & Son Ltd. has acquired a majority share in Wholesome Sweeteners, the natural and organic sweetener business of Sugar Land, Texas-based Imperial Sugar. The newly formed company, Wholesome Sweeteners Inc., will have exclusive marketing rights to Billington's Brand in the U.S. and Canada. Former Billington Retail Sales Director Nigel Willerton has been appointed CEO.
Acirca Inc. of New Rochelle, N.Y., has acquired Oceanside, Calif.-based ShariAnn's Organics. Along with its Walnut Acres brand, the company says the purchase makes Acirca the number one organic ready-to-eat soup company in the U.S. Terms of the deal were not disclosed.
Stocks & Financial News:
Green Mountain Coffee Inc. (GMCR) expects to announce earnings of $.17 to $.19/share at the end of 4Q01 in mid-November. The company also estimates FY01 earnings between $.78 and $.80/share and predicts sales to increase 15 to 20 percent in FY02. In related news, the company earned a ranking of 16 in Forbes magazine's ""200 Best Small Companies in America."" The company was cited for superior marketing techniques and was commended for striving to make all operations sustainable. Additionally, GMCR President and CEO Robert Stiller has been named Forbes' first ""Entrepreneur of the Year.""
Perrigo Co. (PRGO) has extended its stock-repurchasing program to allow the buyback of an additional $20 million or 1.5 million shares of PRGO common stock.
Briefs:
Cyanotech Corp. (CYAN) has received a notice from the United States Patent and Trademark Office (USPTO) informing the company that its patent application for ""Method for Retarding and Ameliorating Canker Sores"" has been approved.
Horizon Organic Holding Corp. (HCOW) has released a line of single-serving milk products. Called ""Organic Milk on the Moo-ve,"" the product is available in chocolate, vanilla, strawberry, and plain flavors.
The National Nutritional Foods Association has announced changes to its 2002 trade show and convention, NNFA MarketPlace. Titled ""Get Down to Business,"" the show will now take place June 7-9, as opposed to June 6-9, in Las Vegas.
The Nov. 23 issue of Readers Digest will feature an article recommending specific vitamins and minerals for varying diets and lifestyles. Readers Digest is available online at www.rd.com.
Rodale Press' Organic Style magazine has announced the members of its new advisory board whose roles will be to ensure the publication maintains its mission to represent current trends in architecture, beauty, cuisine, environment and more. Members include Stonyfield Farm President and CEO Gary Hirshberg; integrative medicine expert, author and botanist Dr. Andrew Weil; co-director of the Piedmont Yoga Institute, Rodney Yee, among others.
This years' Socially Responsible Business Awards recipients were honored at a breakfast at Expo East last week and include Clinton, Mich.-based Eden Foods; Waterbury, Vt.-based Green Mountain Coffee Inc.; San Luis Obispo, Calif.-based herbal tea manufacturer Guayaki; Ann Arbor, Mich.-based Maggie's Organics/Clean Clothes Inc.; and Eugene, Ore.-based Nancy's Yogurt/Springfield Creamery.
According to the Denver Post, soyfoods manufacturer White Wave of Boulder, Colo., has invested $18 million in a new advertising campaign and in approximately 25 major magazines including Rolling Stone and Atlantic Monthly.
The American Herbal Products Association has unveiled new policies adopted by its board of trustees. The policies include the adoption of a healthcare provider communication policy to facilitate better communication between consumers and their doctors; a ""Class 3"" recommendation for labeling herbs as determined by The Botanical Safety Handbook's with appropriate cautionary information; the development of a Congressional Complementary and Alternative Medicine/Natural Foods Caucus; and the endorsement of federal legislation, specifically the Dietary Supplement Tax Fairness Act.
The Andover, Mass.-based Natural Products Consulting Institute has released its Natural Products Field Manual 2002, which includes a directory of natural products and leading mass-market retailers and distributors. It features guest editorials from buyers, brokers and CEOs, and also features coupons worth more than $7,500 in services in the industry. For more information, contact Bob Burke, 978.975.9902, Bobburkesf@aol.com, www.Bob-Burke.com.
Sabinsa Corp., located in Piscataway, N.J., has filed suit against GENI Inc., Ministar International Inc. and Naturex for patent infringement with regard to several Sabinsa patents covering the language used to identify the use of forskohlin and piperline in their products.
Coca-Cola (KO) announced it will offer its Powerade sports drink in seven European countries, including Germany. The company plans to extend the range of the Powerade product across the globe, targeting Europe first as it experienced an 8 percent increase in the sports drink market in the last year.
Archer Daniels Midland Co. (ADM) has announced that it is now paying an extra 20 cents per bushel for soybeans that have not been genetically modified. The company is offering the increased sum through December.
Research Briefs:
""Analyzing the role of Expert Opinion as a Dimension of the World of Wellness,"" a new report published by Bellevue, Wash.-based market research firm The Hartman Group, examines the influence expert opinion has over consumer decision making in the wellness markets. The report notes that consumers place high value on advice and expertise of doctors, friends and relatives. Of those surveyed, 60 percent said they would follow the advice of a doctor, and 49 percent said they would consult a relative or friend. It also said that wellness consumers tend to rely on the verification of information by multiple resources. Visit www.hartman-group.com for more information.
Brevard, N.C.-based Gaia Herbs Inc. and Southwest College of Naturopathic Medicine in Tempe, Ariz., have been awarded a two-phase research grant from the National Center for Complementary and Alternative Medicine of the National Institutes of Health to study the scientific basis and clinical applications of echinacea.
At the recent Cosmetic Dermatology Seminar in Orlando, Fla., and in an article in Dermatology Times, Senetek PLC's (SNTKY) product, Kinetin, was cited for its impact in dermatology practices. In a recent study conducted by Mark G. Rubin of the University of California at San Diego, the product was shown to be a powerful antioxidant and that's beneficial in the prevention as well as the treatment of several skin conditions, including cell aging and biochemical changes in the skin.
International Briefs:
The Health Food Manufacturers' Association (HFMA) in the U.K. has recently been engulfed in controversy about its policies and treatment of members following the resignation of one of its largest members, Holland & Barrett Retail Ltd., from the trade association. Several members have threatened to form a new organization to ""preserve free access to all safe and legitimate natural health products,"" according to a letter sent to HFMA by members, if the association does not take action to engage in meaningful consultation with members.
Don Mills, Ontario, Canada-based Stella Pharmaceuticals is launching its Nutribar meal replacement bar in the U.S. To kick-start the event, the company will sponsor ""Why We Eat the Way We Eat,"" a roundtable aimed to inform experts on nutrition and weight-loss. The event will take place on Oct. 18th in New York and will be conducted by Barbara Levine Ph.D., R.D. of the Human Nutrition Program at The Rockefeller University and the Weill College of Medicine at Cornell University.
The New Zealand-based newspaper, The Business Herald, has reported that Kiwi Dairies may have played a role in what is being called ""Powdergate."" According to The Herald, Kiwi allegedly exported millions of dollars worth of high-value milk proteins illegally. The shipments in question weigh approximately 5,000 tons and are allegedly worth between $10,000 and $20,000 per ton on the world market.
France has established a new agency, called ""Agence Bio,"" that is dedicated to developing and promoting organic foods and agriculture in the country. France hopes to produce 1 million hectares of organic crops by 2005.
Dutch agriculture minister, Laurens-Jan Brinkhorst, is planning to introduce a meat-labeling initiative that would provide information on the living conditions of the animal prior to slaughter. The plan will be implemented within five years.