Sprouts Farmers Market 2013 Annual Report Download - page 22

Table of Contents
discretion to withhold FSIS inspection services, shut down processing facilities, and to take civil or criminal actions against violators
of applicable statutes and regulations. Additionally, the USDA’s Agricultural Marketing Service (referred to as “AMS”) oversees the
National Organics Program for all foods making such “organic” claims. Under the Program, products labeled “organic” must be
certified by an accredited agent as compliant with USDA-established standards. The AMS may levy civil monetary penalties and
withdraw
“organic” certification for up to five years per incident if violations are discovered.
Dietary Supplements. The FDCA has been amended several times with respect to dietary supplements, in particular by the
Dietary Supplement Health and Education Act of 1994 (referred to as “DSHEA”). DSHEA established a framework governing the
composition, safety, labeling, manufacturing and marketing of dietary supplements, defined “dietary supplement” and “new dietary
ingredient” and established new statutory criteria for evaluating the safety of substances meeting the respective definitions. In the
process, DSHEA removed dietary supplements and new dietary ingredients from pre-market approval requirements that apply to
food additives and pharmaceuticals and established a combination of “notification” and “post marketing controls” for regulating
product safety, however, non-dietary ingredients in a dietary supplement remain subject to the FDA’s food additive authorities. The
FDA does not require notification to market a dietary supplement if it contains only dietary ingredients that were present in the U.S.
food supply prior to DSHEA’
s enactment on October 15, 1994. However, for a dietary ingredient not present in the food supply prior
to this date, the manufacturer must provide the FDA with information supporting the conclusion that the ingredient will reasonably
be expected to be safe at least 75 days before introducing a new dietary ingredient into interstate commerce. As required by the
FSMA, the FDA issued draft guidance in July 2011, which attempts to clarify when an ingredient will be considered a “new dietary
ingredient,” the evidence needed to document the safety of a new dietary ingredient, and appropriate methods for establishing the
identity of a new dietary ingredient. In particular, the new guidance may cause dietary supplement products available in the market
before DSHEA to now be classified to include a “new dietary ingredient” if the dietary supplement product was produced using
manufacturing processes different from those used in 1994.
DSHEA also empowered the FDA to establish binding good manufacturing practice regulations governing key aspects of the
production of dietary supplements. DSHEA expressly permits dietary supplements to bear statements describing how a product
affects the structure, function and/or general well-being of the body. Although manufacturers must be able to substantiate any such
statement, no pre-market approval authorization is required for such statements and manufacturers need only notify FDA that they
are employing a given claim. No statement may expressly or implicitly represent that a dietary supplement will diagnose, cure,
mitigate, treat, or prevent a disease. DSHEA does, however, authorize supplement sellers to provide “third-party literature,” ( e.g. ,
a reprint of a peer-reviewed scientific publication linking a particular dietary ingredient with health benefits) in connection with the
sale of a dietary supplement to consumers. This authorization is limited and applies only if the publication is printed in its entirety, is
not false or misleading, presents a balanced view of the available scientific information and does not “promote” a particular
manufacturer or brand of dietary supplement, and is displayed in an area physically separate from the dietary supplements.
Food and Dietary Supplement Advertising. The FTC exercises jurisdiction over the advertising of foods and dietary
supplements. The FTC has the power to institute monetary sanctions and the imposition of “consent decrees” and penalties that
can severely limit a company’s business practices. In recent years, the FTC has instituted numerous enforcement actions against
dietary supplement companies for failure to have adequate substantiation for claims made in advertising or for the use of false or
misleading advertising claims.
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