FDA Underestimates Supplement Industry’s Outlay on Regulatory Compliance, Says NPA

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The Natural Products Association (NPA; Washington, DC) estimates that the dietary supplement industry spends up to $1 billion each year complying with federal Food and Drug Administration (FDA) regulations. Yet FDA’s latest request for comment regarding Current Good Manufacturing Practices in Manufacturing, Packaging, Labeling, or Holding Operations for Dietary Supplements, released April 19, “vastly understates” that expenditure, says an NPA press release.

As FDA is allowed to request a manufacturer’s GMP recordkeeping documents during the course of a GMP inspection (as of 21 CFR Part 111), the agency is also required by law to share its estimates of the cost burden that those requests pose on industry through its public notice and comment process. However, says Dan Fabricant, NPA's CEO and president, in the press release, “FDA’s recordkeeping analysis once again fails to fully understand what firms spend in terms of time and resources meeting and exceeding federal laws to ensure their products are safe for consumers and labeled accurately.”

NPA charges that FDA’s analysis fails to include the cost of maintaining required records for adverse events and serious adverse events related to dietary supplements. It also believes FDA’s hourly estimates related to 21 CFR Part 111 recordkeeping requirements are “vastly” underrated. Moreover, the shift that many firms are making toward electronic recordkeeping and storage has incurred considerable costs that, NPA claims, FDA has failed to consider.

Based on its own estimates and research, NPA calculates the supplement industry’s annual compliance costs as follows:

• Total estimated cost to the industry for regulatory compliance: $512 million–$1 billion
• Total estimated cost for FDA regulation of industry: $24.5 million
• Dietary supplement annual cost for cGMPs (according to FDA): $164 million-$190 million/year. (2007 effective with three-year phase-in for large, medium, and small firms)

• Labeling (1990 effective date):
• Total cost to dietary supplement industry in making a labeling change from FDA’s Nutrition Facts labeling final rule (one time): $143 million-$460 million (for relabeling based upon changes in FDA labeling).
• $204 million-$357 million/year = Cost of labeling or relabeling for the 85,000 estimated dietary supplement product SKUs on the market (85,000 is the number quoted by FDA)

• Adverse-event reporting (June 2007 effective date):
• 50,000 annual adverse events/year projected for the industry and 1,460 domestic dietary supplement firms (25,000 hours/year by an individual with medical knowledge)
• $50/hr for someone with medical training x 25,000 hr = $1.25 million annually