81 FR 90122 - Enforcement Policy Statement on Marketing Claims for OTC Homeopathic Drugs

FEDERAL TRADE COMMISSION

Federal Register Volume 81, Issue 239 (December 13, 2016)

Page Range		90122-90123
FR Document		2016-29770

The Federal Trade Commission has issued an Enforcement Policy Statement on Marketing Claims for OTC Homeopathic Drugs. The Statement describes the level of substantiation that the Commission expects for marketing claims for over-the-counter (OTC) homeopathic drugs. It also recognizes that marketing claims for OTC homeopathic products for an unsubstantiated indication might be made non-deceptive by the inclusion of additional explanatory information that effectively communicates to consumers that there is no scientific evidence that the product works and that the product's claims are based only on theories of homeopathy from the 1700s that are not accepted by most modern medical experts.

Federal Register, Volume 81 Issue 239 (Tuesday, December 13, 2016)

[Federal Register Volume 81, Number 239 (Tuesday, December 13, 2016)]
[Notices]
[Pages 90122-90123]
From the Federal Register Online [www.thefederalregister.org]
[FR Doc No: 2016-29770]

[[Page 90121]]

Vol. 81

Tuesday,

No. 239

December 13, 2016

Part III

Federal Trade Commission

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Enforcement Policy Statement on Marketing Claims for OTC Homeopathic
Drugs; Notice

Federal Register / Vol. 81 , No. 239 / Tuesday, December 13, 2016 /
Notices

[[Page 90122]]

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FEDERAL TRADE COMMISSION

Enforcement Policy Statement on Marketing Claims for OTC
Homeopathic Drugs

AGENCY: Federal Trade Commission.

ACTION: Commission policy statement.

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SUMMARY: The Federal Trade Commission has issued an Enforcement Policy
Statement on Marketing Claims for OTC Homeopathic Drugs. The Statement
describes the level of substantiation that the Commission expects for
marketing claims for over-the-counter (OTC) homeopathic drugs. It also
recognizes that marketing claims for OTC homeopathic products for an
unsubstantiated indication might be made non-deceptive by the inclusion
of additional explanatory information that effectively communicates to
consumers that there is no scientific evidence that the product works
and that the product's claims are based only on theories of homeopathy
from the 1700s that are not accepted by most modern medical experts.

DATES: The Commission announced the issuance of the Statement on
November 15, 2016.

FOR FURTHER INFORMATION CONTACT: Michael Ostheimer (202-326-2699) or
Richard Cleland (202-326-3088), Bureau of Consumer Protection, 600
Pennsylvania Avenue NW., Washington, DC 20580.

SUPPLEMENTARY INFORMATION:

Enforcement Policy Statement on Marketing Claims for OTC Homeopathic
Drugs

The Federal Trade Commission (FTC) is issuing this Policy Statement
to provide guidance regarding its enforcement policy with respect to
marketing claims for over-the-counter (OTC) homeopathic drugs. It
applies only to OTC products intended solely for self-limiting disease
conditions \1\ amenable to self-diagnosis of symptoms and treatment.\2\
The Commission believes this Policy Statement is appropriate in light
of the burgeoning mainstream marketing of OTC homeopathic products
alongside other OTC drugs.
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\1\ A self-limiting disease condition is one that resolves
spontaneously with or without specific treatment.
\2\ This Policy Statement does not apply to the practice of
medicine.
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The FTC's authority over disease and other health-related claims
comes from Sections 5 and 12 of the FTC Act. Section 5, which applies
to both advertising and labeling, prohibits unfair or deceptive acts or
practices in or affecting commerce, such as the deceptive advertising
or labeling of OTC drugs.\3\ Section 12 prohibits the dissemination of
false advertisements in or affecting commerce of food, drugs, devices,
services, or cosmetics.\4\ Under these provisions, companies must have
a reasonable basis for making objective product claims, including
claims that a product can treat specific conditions, before those
claims are made.\5\
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\3\ Federal Trade Commission Act, 15 U.S.C. 45(a)(2).
\4\ Federal Trade Commission Act, 15 U.S.C. 52.
\5\ See Advertising Substantiation Policy Statement, appended to
Thompson Medical Co., 104 F.T.C. 648, 839 (1984), aff'd, 791 F.2d
189 (D.C. Cir. 1986) (``Advertising Substantiation Policy
Statement'').
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Homeopathy, which dates back to the late-eighteenth century, is
based on the view that disease symptoms can be treated by minute doses
of substances that produce similar symptoms when provided in larger
doses to healthy people. Many homeopathic products are diluted to such
an extent that they no longer contain detectable levels of the initial
substance. In general, homeopathic product claims are not based on
modern scientific methods and are not accepted by modern medical
experts, but homeopathy nevertheless has many adherents.\6\
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\6\ FTC Staff Report on the Homeopathic Medicine & Advertising
Workshop (Nov. 2016).
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In 1988, the Food & Drug Administration (FDA) issued a Compliance
Policy Guide (CPG) entitled ``Conditions Under Which Homeopathic Drugs
May be Marketed,'' which permitted marketers to distribute OTC
homeopathic products without demonstrating their efficacy.\7\ Under the
CPG, only homeopathic products intended solely for self-limiting
disease conditions amenable to self-diagnosis of symptoms and treatment
may be marketed OTC. The CPG requires that OTC homeopathic drugs be
labeled as homeopathic and that their labeling display at least one
major OTC indication for use.
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\7\ See CPG Sec. 400.400 Conditions Under Which Homeopathic
Drugs May be Marketed (revised Mar. 1995), http://www.fda.gov/iceci/compliancemanuals/compliancepolicyguidancemanual/ucm074360.htm.
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The FTC Act does not exempt homeopathic products from the general
requirement that objective product claims be truthful and
substantiated.\8\ Nevertheless, in the decades since the Commission
announced in 1972 that objective product claims must be
substantiated,\9\ the FTC has rarely challenged misleading claims for
products that were homeopathic or purportedly homeopathic.\10\
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\8\ ``[A] product that contemporary technology does not
understand must establish that this `magic' actually works. Proof is
what separates an effect new to science from a swindle . . . . [I]f
a condition responds to treatment, then selling a placebo as if it
had therapeutic effect directly injures the consumer.'' FTC v. QT,
Inc., 512 F.3d 858, 862-63 (7th Cir. 2008).
\9\ See Pfizer, Inc., 81 F.T.C. 23, 62-64 (1972).
\10\ See, e.g., Complaint, FTC v. HCG Diet Direct, LLC, No.
2:14-cv-00015-NVW (D. Ariz. Jan. 7, 2014) (stipulated judgment)
(challenging weight-loss claims for purported homeopathic products);
Complaint, FTC v. Iovate Health Scis. USA, Inc., No. 10-CV-587
(W.D.N.Y. July 14, 2010) (stipulated judgment) (challenging claims
that purported allergy-relieving product was homeopathic and
effective); Quigley Corp., No. C-3926, 2000 FTC LEXIS 24 (Feb. 10,
2000) (consent order) (challenging cold treatment and prevention
claims for homeopathic products); Levey, 116 F.T.C. 885 (1993)
(consent order) (challenging weight-loss and impotency treatment
claims for purported homeopathic products).
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Efficacy and safety claims for homeopathic drugs are held to the
same standards as similar claims for non-homeopathic drugs. As
articulated in the Advertising Substantiation Policy Statement,
advertisers must have ``at least the advertised level of
substantiation.'' Absent express or implied reference to a particular
level of support, the Commission, in evaluating the types of evidence
necessary to substantiate a claim, considers ``the type of claim, the
product, the consequences of a false claim, the benefits of a truthful
claim, the cost of developing substantiation for the claim, and the
amount of substantiation experts believe is reasonable.'' \11\ For
health, safety, or efficacy claims, the FTC has generally required that
advertisers possess ``competent and reliable scientific evidence,''
defined as ``tests, analyses, research, or studies that have been
conducted and evaluated in an objective manner by qualified persons and
[that] are generally accepted in the profession to yield accurate and
reliable results.'' \12\ In general, for health benefit claims,
particularly claims that a product can treat or prevent a disease or
its symptoms, the substantiation required has been well-designed human
clinical testing.\13\
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\11\ Advertising Substantiation Policy Statement, 104 F.T.C. at
840. These factors are known as the Pfizer factors, after the 1972
case, supra note 9, in which they were first enunciated.
\12\ See, e.g., POM Wonderful LLC, 155 F.T.C. 56, 193 (2013),
aff'd in part, 777 F.3d 478, 504-05 (D.C. Cir. 2015), cert. denied,
No. 15-525, 2016 U.S. LEXIS 2991 (May 2, 2016); Telebrands Corp.,
140 F.T.C. 278, 347 (2005), aff'd, 457 F.3d 354 (4th Cir. 2006);
Novartis Corp., 127 F.T.C. 580, 725 (1999), aff'd, 223 F.3d 783
(D.C. Cir. 2000); Brake Guard Prods., Inc., 125 F.T.C. 138, 256
(1998).
\13\ See, e.g., POM Wonderful LLC, 155 F.T.C. at 5-6 (requiring
well-designed, well-conducted, double-blind, randomized controlled
clinical testing to substantiate heart disease, prostate cancer, and
erectile dysfunction prevention and treatment claims; also imposing
such a requirement for all future disease claims), aff'd in part,
777 F.3d at 504-05 (affirming Commission holding that competent and
reliable scientific evidence consisting of randomized, well-
controlled human clinical testing is needed for disease-related
claims but finding fencing-in order requirement of two such tests
was not justified in this instance); see also FTC v. Nat'l
Urological Group, Inc., 645 F. Supp. 2d 1167, 1202-03 (N.D. Ga.
2008) (accepting undisputed expert testimony that erectile
dysfunction claims require well-designed, placebo-controlled,
randomized, double-blind clinical trials for substantiation); FTC v.
Direct Mktg. Concepts, Inc., 569 F. Supp. 2d 285, 303 (D. Mass.
2008), aff'd, 624 F.3d 1 (1st Cir. 2010) (``it seems well-accepted
that double-blind, placebo-controlled studies are necessary to
substantiate health-related efficacy claims''); Removatron Int'l
Corp., 111 F.T.C. 206 (1988), aff'd, 884 F.2d 1489 (1st Cir. 1989)
(requiring ``adequate and well-controlled clinical testing'' to
substantiate claims for hair removal product); Thompson Med. Co.,
104 F.T.C. at 826 (requiring well-controlled clinical studies to
substantiate certain analgesic drug claims). The Commission has also
accepted numerous settlements that required randomized controlled
clinical testing for disease treatment and prevention claims. See,
e.g., Brown, 152 F.T.C. 466, 481-82 (2011) (consent order);
Nestl[eacute] HealthCare Nutrition, Inc., 151 F.T.C. 1, 13 (2011)
(consent order); Viral Response Sys., Inc., 115 F.T.C. 676, 691
(1992) (consent order).

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[[Page 90123]]

For the vast majority of OTC homeopathic drugs, the case for
efficacy is based solely on traditional homeopathic theories and there
are no valid studies using current scientific methods showing the
product's efficacy. Accordingly, marketing claims that such homeopathic
products have a therapeutic effect lack a reasonable basis and are
likely misleading in violation of Sections 5 and 12 of the FTC Act.\14\
However, the FTC has long recognized that marketing claims may include
additional explanatory information in order to prevent the claims from
being misleading. Accordingly, the promotion of an OTC homeopathic
product for an indication that is not substantiated by competent and
reliable scientific evidence may not be deceptive if that promotion
effectively communicates to consumers that: (1) There is no scientific
evidence that the product works and (2) the product's claims are based
only on theories of homeopathy from the 1700s that are not accepted by
most modern medical experts.\15\ To be non-misleading, the product and
the claims must also comply with requirements for homeopathic products
and traditional homeopathic principles. Of course, adequately
substantiated claims for homeopathic products would not require
additional explanation.
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\14\ Although this Policy Statement is limited to OTC
homeopathic products for the treatment of self-limiting disease
conditions (ones that resolve spontaneously with or without specific
treatment) amenable to self-diagnosis, marketing claims about the
efficacy of homeopathic products not covered by this Policy
Statement also are subject to the requirements to Sections 5 and 12.
\15\ A statement that a product is based on traditional
homeopathic theories might put some consumers on notice as to the
basis of the product's efficacy claims. However, because many
consumers do not understand what homeopathy is, the Commission does
not believe that such a statement alone would adequately put
consumers on notice that a product's efficacy claims are not backed
by scientific evidence, and could, in fact, enhance the perceived
credibility of the claim. Similarly, the Commission believes that a
statement that a product's efficacy ``has not been evaluated by the
Food and Drug Administration'' does not adequately address the
potential lack of substantiation for a product's efficacy claims;
dietary supplements bear a similar disclosure but FDA does require
that dietary supplement label claims be supported by competent and
reliable scientific evidence. Finally, the Commission believes that
a simple statement that a product's efficacy is not supported by
scientific evidence does not convey the truly limited basis for the
efficacy claim and that, to avoid deceiving consumers, it is likely
necessary to explain that it is not accepted by modern medicine.
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Perfunctory disclaimers are unlikely to successfully communicate
the information necessary to make claims for OTC homeopathic drugs non-
misleading. The Commission notes:
Any disclosure should stand out and be in close proximity
to the efficacy message; to be effective, it may actually need to be
incorporated into the efficacy message.
Marketers should not undercut such qualifications with
additional positive statements or consumer endorsements reinforcing a
product's efficacy.
In light of the inherent contradiction in asserting that a
product is effective and also disclosing that there is no scientific
evidence for such an assertion, it is possible that depending on how
they are presented many of these disclosures will be insufficient to
prevent consumer deception. Marketers are advised to develop extrinsic
evidence, such as consumer surveys, to determine the net impressions
communicated by their marketing materials.
The Commission will carefully scrutinize the net
impression of OTC homeopathic advertising or other marketing employing
disclosures to ensure that it adequately conveys the extremely limited
nature of the health claim being asserted. If, despite a marketer's
disclosures, an ad conveys more substantiation than the marketer has,
the marketer will be in violation of the FTC Act.
In summary, there is no basis under the FTC Act to treat OTC
homeopathic drugs differently than other health products. Accordingly,
unqualified disease claims made for homeopathic drugs must be
substantiated by competent and reliable scientific evidence.
Nevertheless, truthful, non-misleading, effective disclosure of the
basis for an efficacy claim may be possible. The approach outlined in
this Policy Statement is therefore consistent with the First Amendment,
and neither limits consumer access to OTC homeopathic products nor
conflicts with the FDA's regulatory scheme. It would allow a marketer
to include an indication for use that is not supported by scientific
evidence so long as the marketer effectively communicates the limited
basis for the claim in the manner discussed above.

By direction of the Commission.
Donald S. Clark,
Secretary.
[FR Doc. 2016-29770 Filed 12-12-16; 8:45 am]
BILLING CODE 6750-01-P

90122 Federal Register / Vol. 81, No. 239 / Tuesday, December 13, 2016 / Notices

FEDERAL TRADE COMMISSION or affecting commerce, such as the Commission announced in 1972 that
deceptive advertising or labeling of OTC objective product claims must be
Enforcement Policy Statement on drugs.3 Section 12 prohibits the substantiated,9 the FTC has rarely
Marketing Claims for OTC dissemination of false advertisements in challenged misleading claims for
Homeopathic Drugs or affecting commerce of food, drugs, products that were homeopathic or
AGENCY: Federal Trade Commission. devices, services, or cosmetics.4 Under purportedly homeopathic.10
these provisions, companies must have Efficacy and safety claims for
ACTION: Commission policy statement. a reasonable basis for making objective homeopathic drugs are held to the same
SUMMARY: The Federal Trade product claims, including claims that a standards as similar claims for non-
Commission has issued an Enforcement product can treat specific conditions, homeopathic drugs. As articulated in
Policy Statement on Marketing Claims before those claims are made.5 the Advertising Substantiation Policy
for OTC Homeopathic Drugs. The Homeopathy, which dates back to the Statement, advertisers must have ‘‘at
Statement describes the level of late-eighteenth century, is based on the least the advertised level of
substantiation that the Commission view that disease symptoms can be substantiation.’’ Absent express or
expects for marketing claims for over- treated by minute doses of substances implied reference to a particular level of
the-counter (OTC) homeopathic drugs. It that produce similar symptoms when support, the Commission, in evaluating
also recognizes that marketing claims provided in larger doses to healthy the types of evidence necessary to
for OTC homeopathic products for an people. Many homeopathic products are substantiate a claim, considers ‘‘the type
unsubstantiated indication might be diluted to such an extent that they no of claim, the product, the consequences
made non-deceptive by the inclusion of longer contain detectable levels of the of a false claim, the benefits of a truthful
additional explanatory information that initial substance. In general, claim, the cost of developing
effectively communicates to consumers homeopathic product claims are not substantiation for the claim, and the
that there is no scientific evidence that based on modern scientific methods and amount of substantiation experts believe
the product works and that the are not accepted by modern medical is reasonable.’’ 11 For health, safety, or
product’s claims are based only on experts, but homeopathy nevertheless efficacy claims, the FTC has generally
theories of homeopathy from the 1700s has many adherents.6 required that advertisers possess
that are not accepted by most modern In 1988, the Food & Drug ‘‘competent and reliable scientific
medical experts. Administration (FDA) issued a evidence,’’ defined as ‘‘tests, analyses,
Compliance Policy Guide (CPG) entitled research, or studies that have been
DATES: The Commission announced the
‘‘Conditions Under Which Homeopathic conducted and evaluated in an objective
issuance of the Statement on November
Drugs May be Marketed,’’ which manner by qualified persons and [that]
15, 2016.
permitted marketers to distribute OTC are generally accepted in the profession
FOR FURTHER INFORMATION CONTACT:
homeopathic products without to yield accurate and reliable results.’’ 12
Michael Ostheimer (202–326–2699) or demonstrating their efficacy.7 Under the
Richard Cleland (202–326–3088), In general, for health benefit claims,
CPG, only homeopathic products particularly claims that a product can
Bureau of Consumer Protection, 600 intended solely for self-limiting disease
Pennsylvania Avenue NW., Washington, treat or prevent a disease or its
conditions amenable to self-diagnosis of symptoms, the substantiation required
DC 20580. symptoms and treatment may be has been well-designed human clinical
SUPPLEMENTARY INFORMATION: marketed OTC. The CPG requires that testing.13
Enforcement Policy Statement on OTC homeopathic drugs be labeled as
Marketing Claims for OTC homeopathic and that their labeling 9 See Pfizer, Inc., 81 F.T.C. 23, 62–64 (1972).
Homeopathic Drugs display at least one major OTC 10 See, e.g., Complaint, FTC v. HCG Diet Direct,
indication for use. LLC, No. 2:14–cv–00015–NVW (D. Ariz. Jan. 7,
The Federal Trade Commission (FTC) The FTC Act does not exempt 2014) (stipulated judgment) (challenging weight-
is issuing this Policy Statement to homeopathic products from the general
loss claims for purported homeopathic products);
provide guidance regarding its Complaint, FTC v. Iovate Health Scis. USA, Inc.,
requirement that objective product No. 10–CV–587 (W.D.N.Y. July 14, 2010) (stipulated
enforcement policy with respect to claims be truthful and substantiated.8 judgment) (challenging claims that purported
marketing claims for over-the-counter Nevertheless, in the decades since the allergy-relieving product was homeopathic and
(OTC) homeopathic drugs. It applies effective); Quigley Corp., No. C–3926, 2000 FTC
only to OTC products intended solely LEXIS 24 (Feb. 10, 2000) (consent order)
3 Federal Trade Commission Act, 15 U.S.C.
(challenging cold treatment and prevention claims
for self-limiting disease conditions 1 45(a)(2). for homeopathic products); Levey, 116 F.T.C. 885
amenable to self-diagnosis of symptoms 4 Federal Trade Commission Act, 15 U.S.C. 52.
(1993) (consent order) (challenging weight-loss and
and treatment.2 The Commission 5 See Advertising Substantiation Policy impotency treatment claims for purported
believes this Policy Statement is Statement, appended to Thompson Medical Co., homeopathic products).
104 F.T.C. 648, 839 (1984), aff’d, 791 F.2d 189 (D.C. 11 Advertising Substantiation Policy Statement,
appropriate in light of the burgeoning Cir. 1986) (‘‘Advertising Substantiation Policy 104 F.T.C. at 840. These factors are known as the
mainstream marketing of OTC Statement’’). Pfizer factors, after the 1972 case, supra note 9, in
homeopathic products alongside other 6 FTC Staff Report on the Homeopathic Medicine which they were first enunciated.
OTC drugs. & Advertising Workshop (Nov. 2016). 12 See, e.g., POM Wonderful LLC, 155 F.T.C. 56,
7 See CPG Sec. 400.400 Conditions Under Which 193 (2013), aff’d in part, 777 F.3d 478, 504–05 (D.C.
The FTC’s authority over disease and
Homeopathic Drugs May be Marketed (revised Mar. Cir. 2015), cert. denied, No. 15–525, 2016 U.S.
other health-related claims comes from 1995), http://www.fda.gov/iceci/ LEXIS 2991 (May 2, 2016); Telebrands Corp., 140
Sections 5 and 12 of the FTC Act. compliancemanuals/ F.T.C. 278, 347 (2005), aff’d, 457 F.3d 354 (4th Cir.
Section 5, which applies to both
mstockstill on DSK3G9T082PROD with NOTICES2

compliancepolicyguidancemanual/ 2006); Novartis Corp., 127 F.T.C. 580, 725 (1999),
advertising and labeling, prohibits ucm074360.htm. aff’d, 223 F.3d 783 (D.C. Cir. 2000); Brake Guard
8 ‘‘[A] product that contemporary technology does Prods., Inc., 125 F.T.C. 138, 256 (1998).
unfair or deceptive acts or practices in not understand must establish that this ‘magic’ 13 See, e.g., POM Wonderful LLC, 155 F.T.C. at 5–

actually works. Proof is what separates an effect 6 (requiring well-designed, well-conducted, double-
1 A self-limiting disease condition is one that
new to science from a swindle . . . . [I]f a condition blind, randomized controlled clinical testing to
resolves spontaneously with or without specific responds to treatment, then selling a placebo as if substantiate heart disease, prostate cancer, and
treatment. it had therapeutic effect directly injures the erectile dysfunction prevention and treatment
2 This Policy Statement does not apply to the consumer.’’ FTC v. QT, Inc., 512 F.3d 858, 862–63 claims; also imposing such a requirement for all
practice of medicine. (7th Cir. 2008). future disease claims), aff’d in part, 777 F.3d at

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Document Created: 2016-12-13 02:44:51
Document Modified: 2016-12-13 02:44:51

Category		Regulatory Information
Collection		Federal Register
sudoc Class		AE 2.7: GS 4.107: AE 2.106:
Publisher		Office of the Federal Register, National Archives and Records Administration
Section		Notices
Action		Commission policy statement.
Dates		The Commission announced the issuance of the Statement on November 15, 2016.
Contact		Michael Ostheimer (202-326-2699) or Richard Cleland (202-326-3088), Bureau of Consumer Protection, 600 Pennsylvania Avenue NW., Washington, DC 20580.
FR Citation		81 FR 90122