anthony l. young kleinfeld, kaplan & becker llp ayoung@kkblaw

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Supply Side West 2009Energy Shots and Beverages: Growth, Innovation, Safety and

Regulation Legal and Regulatory Issues Affecting Energy Shots and

Beverages

Anthony L. Young

Kleinfeld, Kaplan & Becker LLP

ayoung@kkblaw.com

ENERGY BEVERAGE WEBSITE

• http://www.screamingenergy.com/

• More than you ever would want to know, but . . .

• Products that stretch the imagination of even the most jaded marketeer

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ENERGY BEVERAGE WEBSITE OCTOBER ENTRY

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Food or Dietary Supplement

• First Issue – What is it• Marketer picks the category - food or

dietary supplement• Nutritional Facts for food • Supplement Facts for dietary

supplements• Customers and retailers no longer

make a distinction• 7-11 would know the difference?

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Energy Shots and Beverages Focus on Particular Consumer

Needs• Energy

• Stimulation

• Alertness

• Focus

• Attention

• Stay awake

• And more “energy”

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Energy Shot Ingredients Besides SUGAR

• Caffeine, guarana and other caffeine source ingredients

• Taurine

• L-carnitine

• B vitamins

• Ginseng

• Amino acids

Taurine

• Not technically an amino acid but referred to as one

• Supports neurological development and helps regulate the level of water and mineral salts in the blood

• Thought to have antioxidant properties• Some studies suggest taurine

supplementation may improve athletic performance

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B vitamins

• Important in cell metabolism

• Help convert food to energy

• Well known for energy support

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L-carnitine

• Synthesized in the liver and kidneys from amino acids and stored in muscle

• Helps the body turn fat into energy

• May be difficult to formulate so that it survives processing

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Ginseng and Ginkgo• Ginseng reported to increase the body’s

resistance to stress (adaptogen)

• Ginseng is traditionally used as a stimulant: thought to improve mental and physical performance

• Ginkgo to enhance blood circulation

• Ginkgo to enhance memory

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Glucuronolactone

• Carbohydrate

• Produced by the metabolism of glucose in the liver

• Structural component of most connective tissues

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Milk Thistle Extract and Acai• Milk Thistle historically used to treat liver

disease and to protect the liver against toxins

• Acai has measured antioxidant properties (contains anthocyanins and flavonoids)

•  

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ENERGY and Shot Claims

• Energy

• Feel it in minutes

• Energy for a specific period

• Energy for a specific purpose

• More energy

• Claims are supported by energy related professional sports endorsements that reinforce ENERGY

ENERGY and Shot Claims

• Some performance enhancment claims

• Red Bull, the 800 lb Gorilla in the marketplace, appears to make some of the more aggressive and specific claims

• All In is one to take in Vegas - it has an interesting poker tie-in, instead of the athlete ties of most energy beverages

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RED BULL Claims

– Increases performance– Increases concentration and reaction speed– Improves vigilance– Improves emotional status– Stimulates metabolism – Vitalizes body and mind – Developed for times of increased mental

and physical exertion

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Other Energy Drink Claims

• twice the buzz of a regular energy drink

• ideal for persons who need a boost but aren’t afforded the most timely restroom breaks

• scientifically formulated to provide an incredible energy boost for those who lead active and exhausting lifestyles

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ALL IN Claims

• All In delivers the ideal premium energy drink to the fast moving world of poker.

• All In is a premium product…without sugar, carbs, or excess calories. 

• All in uses herbs, vitamins and amino acids and provides a smooth, sustained sharpening of focus and pure energy every poker player needs.

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Other Energy Shot Products

• Dr. Chao - Herbal Lady Drink (PMS)

• Dr. Chao - Herbal Adult Drink

• Dr. Chao – Herbal 21 Drink

• Dr. Chao – Herbal Stress Reliever Drink

• Note for Blumenthal – no Herbal Guy drink

• And no Herbal Lawyer Up drink either18

Herbal Lady Drink

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Energy Shots and Beverages Labeled as Foods

• Nutrition Facts Box is limited to nutrients – no place to display functional non-nutrients – so taurine and guarana cannot be included.

• On the Information Panel, non nutrient ingredients must be included only in the ingredients declaration for the product.

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FDA Regulations Limit Health and Nutrient Content Claims for Foods

and Dietary Supplements

• Nutrient content claim regulations limit claims about the presence of ingredients to FDA - recognized nutrients.

• To tout the presence of ingredients, the actual amount per serving must be stated.

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First Amendment and FDA

• In 2002 FDA asked for comment on those FDA claim rules believed to infringe on truthful and not misleading commercial speech.

• Nutrient content claim regulations were identified as First Amendment suspect – but this proceeding never got off the ground, and now never will.

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Nutritive Value - Food

• FDA defines nutritive value as value in sustaining human existence by such processes as promoting growth, replacing lost nutrients, or providing energy

• Physiological effect that provides a benefit through growth or health improvement probably meets the definition

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Claims for Foods More Restrictive than Dietary Supplements

• Health Claims – F and DS• Qualified Health Claims – F and DS• Structure Function Claims for foods

based on nutritive value effects or taste or aroma of the food – F

• Structure Function Claims for dietary ingredients based on demonstrated effect on structure or function of the body – DS

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Dietary Supplements in Conventional Food Form

• May be in conventional food form but must be represented as supplement and not conventional food

• May not be represented as a meal or meal replacement or snack

• May not be linked to a meal or conventional food form

• Labels, labeling and advertising must stay out of food arena

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New Ingredients for Energy Shots

• New ingredients or novel forms of old ingredients must meet regulatory requirements for foods or supplements

• New or novel food ingredients must be GRAS or food additive approved

• Dietary ingredients must be old ingredients or lawfully marketed new dietary ingredients

Ingredients In Energy Drinks

• Surprised to see that there is little exotica in the ingredients

• Marketeers here appear to be looking for marketing niches based on endorsements, affiliations and packaging

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GRAS Substances for Food Energy Shots

• § 402(a)(2)(C): adulterated if it contains an “unsafe” food additive

• § 409: “unsafe” food additive is one not covered by an FDA regulation, OR

• the substance is GRAS through common knowledge throughout the scientific community

• Reasonable certainty that the substance is not harmful under the specific intended conditions of use – (reasonable certainty of no harm)

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Conditions of Use

• GRAS notifications to FDA must list the foods for which the ingredient is intended

• 21 CFR Sec. 170.3• Must describe and list proposed amounts

for the food category • Many food ingredients are NOT GRAS for

all uses

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GRAS Self-Affirmation

• Scientific Procedures– Generally available and accepted

scientific data Ordinarily published Corroborated by unpublished data

– Normally reviewed by expert panel– OR

• Common use in food prior to 1958• NO FDA REVIEW LEGALLY REQUIRED

FOR EITHER CATEGORY

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GRAS Self-Affirmation

• GRAS self-affirmation is a predicate for the use of an ingredient in food

• Panel of Experts review and conclusion is important to customers

• If FDA finds the ingredient and questions its use, the GRAS Self-Affirmation package provides a defensive conversation piece

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GRAS Self-Affirmation

• Largest ingredient customers (Coca-Cola, Pepsi) may not accept GRAS self-affirmation for an ingredient

• If FDA disagrees with the use of a self-affirmed ingredient in food they may advise customer that their products may be adulterated.

• FDA may make products containing the ingredient subject to seizure or injunction

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GRAS NOTIFICATION TO FDA

• Since mid-1997 GRAS Notification may voluntarily be submitted to FDA– Proposed Rule 62 FR 18938 4/17/97– If successful, results in a “No-Question”

letter– Replaces the old GRAS-affirmation

process– Replaces a regulatory process that was

too long – required too much FDA buy-in

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FDA GRAS NOTIFICATION WEBSITE

• FDA provides guidance to those considering GRAS notification

• FDA provides chronology of GRAS notifications and responses

• FDA response letters provide good guidance on data requirements

• FDA provides guidance on estimating total dietary intake of the substance

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Successful GRAS Notifications

• Pre-submission meeting with FDA with Expert Panel Report as meeting baseline

• Listening carefully to what FDA says pre-submission

• Some published data and information• Data and information package presents

quality relevant data • GRAS notification is written by someone

schooled in FDA data requirements and FDA lines of inquiry

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Successful GRAS Notifications

• Panel of Experts ARE “qualified by training and experience to evaluate the safety of the substance under the conditions of use” proposed

• The proposed conditions of use are not controversial for the ingredient

• Panel of Experts addresses all relevant and expected issues including any raised by FDA pre-submission

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FDA Informal Responses

• FDA GRAS Notification review staff is experienced and knowledgeable

• Review staff is not restrained from asking questions to clarify the submission

• Review staff will advise notifier if the notification is going to receive an unfavorable response

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Old Dietary Ingredients

• On the market prior to October 15, 1994

• Must be one of the defined dietary supplement ingredient catagories

• Must not have been a new drug ingredient – ephedrine HCl example

• And probably not on the market as a drug

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New Dietary Ingredients

• Developed since October 15, 1994

• NDI premarket notification required unless the ingredient is present in the food supply and is used in a form in which the food has not been chemically altered

• If you claim it is new, different or never before available, you need to respect the NDI requirements

Basic Safety Premise

• Reasonable expectation of safety when used or consumed as directed

• Don’t test new product ingredients on the customer

• How would you like to testify in court that “you thought it was safe” but had never sought to substantiate it.

• Have a reasonable basis that ingredient combinations are safe.

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New Sheriff in Town

• With the changed Administration, expect more concern around safety of foods and dietary supplements

• The National Nanny is back in residence, we will be told what is good for us

• Expect some focus on large amounts of SUGAR and CAFFEINE in products.

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Energy Shots are “Functional Foods”

• Industry has said that no new regulatory definition or distinct regulatory approach is necessary for the evaluation of the safety of ingredients added to ``functional foods'‘.

• More use of labeling and restrictions on use was suggested for GRAS review of functional ingredients.

Energy Drinks Under Scrutiny

• 12 year old reports results of study conducted to see if energy drinks like “Monster” delivered as intended. Brendan D. O’Neil – future MD

• Caffeinated “Monster” against decaffeinated Sprite

• “Monster” as compared with soday had no significant effect on exercise performance.

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Energy Drink Study Author

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Energy Drink Safety

• These products are being sold to people who want a faster lifestyle, the issue of the safety of caffeine, as well as other ingredients will be raised about this category.

• Similar to the sports supplement model, the marketing is to a population that makes itself vulnerable.

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Caffeine

• Medline Plus says: It is recommended that pregnant women consume less than 300 mg of caffeine a day.

• Caffeine passes into breast milk in small amounts and may build up in the nursing baby.

• FFDCA Section 201(n) material information for Moms – why NOT require added caffeine to be labeled?

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Caffeine

• Major marketers of caffeine containing beverages include the amount of caffeine on their product labels.

• Some energy shot product contain caffeine amount labeling and a caution regarding use by pregnant women.

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Additional Energy Drink Consideration

• Took a boat tour of the Chicago River

• First drink on the bar menu was Red Bull and Vodka

• All foods should be compatible with all foods – so mixing into cocktails is no surprise

• But formulators should take the liquor mixing into consideration

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WHERE’S THE ACTION?

• CALIF AG lawsuit against Kellogg's for Immunity Claim on cereals – no surgical mask for Tony the Tiger – Pvt lawsuits follow

• Consumer class action against Danone and over $30 million (note $ not Euros)

• Lawsuits over “natural” and the like

• Success has benefits, and a price

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FDA Functional Food HearingNovember 2006

• There was no support for a requirement that companies that market ingredients for addition to ``functional foods'' notify FDA prior to introducing the ingredients into interstate commerce.

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FDA Functional Food Hearing

• There appeared to be agreement that data and information appropriate to demonstrate that ingredients added to conventional foods being marketed as ``functional foods'' meet the present safety standard of ``reasonable certainty of no harm'‘ and achieve GRAS status.

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FDA Functional Food Hearing

• Commentators did not support a premarket notification process for presentation of the scientific evidence supporting structure/function claims for ``functional foods'' and ingredients, as recommended by IFT.

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FDA Functional Food Hearing

• There was agreement that conventional foods being marketed as ``functional foods'' could be adequately addressed through the current regulations for food additives, GRAS substances, and labeling claims.

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THANK YOU

Tony Young ayoung@kkblaw.com

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Glossary of Terms

• Food – a food for man providing taste, aroma or nutritive value, including chewing gum.

• Dietary Supplement – a product for ingestion, other than tobacco, intended to supplement the diet that contains a vitamin, mineral, herb/botanical, amino acid, dietary substance, or concentrate, metabolite, constituent or extract, or a combination of those ingredients.

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GRAS

• GRAS – applies to food ingredients, GRAS means Generally Recognized as Safe for use in food by experts qualified by training and experience to evaluate the safety of such ingredients

• GRAS Self-Affirmation – a safety review by experts for use by a company marketing or using a food ingredient

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GRAS Basis

• Common use in food prior to 1958 when the Food Additive Amendments were passed shows safety

• Scientific procedures which can mean a variety of scientific information ranging from in vitro tests, animal studies, to human clinical studies, some published, that show safety

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Dietary Ingredient

• Vitamin, mineral, herb/botanical, amino acid, dietary substance, or concentrate, metabolite, constituent or extract

• If a dietary substance, FDA position is that it must be an ingredient consumed in the diet