FTC: Bogus health care claims to consumers will be costly for businesses

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Health care products need to be backed by science or quackery will be costly, according to government regulators.

The Federal Trade Commission (FTC) announced they are putting hundreds of advertisers on notice that if they deceive patients with product claims that cannot be backed up or substantiated, they will face fines up to $50,120 per violation.

The list of about 670 recipients includes businesses that market over-the-counter drugs, homeopathic products, dietary supplements, or functional foods.

“The requirement for advertisers to have adequate support for their advertising claims at the time they’re made is a bedrock principle of FTC law,” Sam Levine, director of the FTC’s Bureau of Consumer Protection, said in a statement. “The prospect of steep civil penalties will help ensure that advertisers don’t play fast and loose with the truth.”

What are the standards?

Some of the companies are household names: Amazon, Amway, Bayer, Cargill, Coca-Cola Co., Costco, CVS, GNC, Johnson & Johnson, Kellogg, Kraft Heinz Co., PepsiCo, Pfizer, Procter & Gamble, Rite Aid Corp., Walgreens.

But the FTC emphasized “inclusion on the list does not in any way suggest that it has engaged in deceptive or unfair conduct.”

Rather, “if a company claims that its product can cure, mitigate, or treat a serious disease such as cancer or heart disease, it must back up that claim through the accepted standards of scientific testing.”

What are the standards? Products must have:

• A reasonable basis consisting of competent and reliable evidence for objective product claims.
• Competent and reliable scientific evidence to support health or safety claims.
• At least one well-controlled human clinical trial to support claims that a product is effective in curing, mitigating, or treating a serious disease.

The FTC also highlighted unlawful acts such as:

• Misrepresenting the level or type of substantiation for a claim.
• Misrepresenting that a product claim has been scientifically or clinically proven.

The FTC has used lawsuits and policy statements to guide businesses about advertising substantiation. Even so, “many sellers continue to make unsubstantiated claims about their products and false claims about proof they have,” according to the Commission.

Commissioners speak

On March 31, the FTC voted 3-1 to issue the notice.

Health-claim scams are at best a waste of money, and at worst may cause serious health problems, said a statement by Commissioner Rebecca Kelly Slaughter. Those also hurt the free market for business.

“It is impossible to evaluate competing products in a market with no baseline level of accuracy or truthfulness about the effectiveness of those claims,” Slaughter said in her statement. “Scrupulous companies with effective products can get crowded out of a market when compared to snake oil that promises the same benefits but better, faster, and cheaper. People suffer real physical, financial, and emotional harm when purported cures and treatments do not live up to their marketing promises.”

Commission Chair Lina Khan and Commissioner Alvaro M. Bedoya joined Slaughter in the statement.

Commissioner Christine S. Wilson dissented. She said she has supported FTC notices about clear-cut violations involving outright fraud or patently false statements. But the current FTC notice will involve complex proof, she said, predicting “relatively few cases in this topic area will result in civil penalties,” but consuming significant FTC resources.

Wilson stepped down from the post on March 31.