I thought about titling this post—“Fat and foreign? Let’s make a deal!”—but that seemed a bit too sensational and disrespectful to Monty Sharma, CEO of Atkins Nutritionals, who inspired the thought. In a recent interview for our upcoming issue on the overall nutrition industry, Sharma discussed global obesity rates and how certain countries, unfortunately, present better growth opportunities for Atkins than others.

In 2009, Atkins expanded operations to Spain, Portugal, the Middle East and India. “The reason these countries are important for us,” says Sharma, “is that obesity and diabetes are rampant there.” He pointed to the Gulf Cooperation Council (GCC) countries in and around Dubai as some of the highest incidences of diabetes and obesity in the world. “These countries have serious issues because of food habits,” says Sharma.

International revenue at Atkins is trending toward 15% of total revenue, up from about 5% in the past two years, when Atkins began a reinvention of itself as a weight-management platform far removed from its ‘no-carbs’ origins. Though specific figures remain unspecified—Atkins is privately held by North Castle Partners—Sharma does verify 45% annual growth on the trailing 52 weeks of data. That’s no small feat given the pernicious softness of the U.S. economy.

Looking forward, Sharma sees potential in the Benelux countries, Sweden, Norway, South Africa and Germany. “We will continue to grow internationally in 2010,” says Sharma. “The markets we look at are all very good markets in terms of their obesity.”

A further sobering thought from Sharma that I can’t seem to shake: “The number of people overweight and obese overseas is far greater than that in the U.S. The opportunity overseas is greater, one would argue, than the sales opportunity here in the U.S.” There are too many ways to digest a statement like that in a mere blog post, but let’s just say that the growing trend toward wellness has some big hurdles to overcome far beyond the usual suspects of consumer education, regulatory scrutiny and competitive pressures.

Related NBJ links:

SNWL Sales Suffer Blow from Recession and Flurry of Negative News Events

Spain: An Innovator in the Global Functional Food Market

Healthy, Lesser-Evil & Functional Foods

You know the United States has reached a new state of litigiousness when a consumer sues Kellogg’s for not putting real fruit in its Froot Loops cereals, as Roy Werbel did in April. The disgruntled cereal eater filed a class-action lawsuit in San Francisco federal court that alleged the cereal company’s marketing “is deceptive and likely to mislead and deceive a ‘reasonable consumer’ such as himself” into believing the company’s popular sugary cereal contains actual fruit—even though the product’s ingredient label clearly communicates the opposite. The suit demands Kellogg’s pay punitive and actual damages to all consumers who were mislead by the Froot Loops name.

Although it certainly sits at the “crazy” end of the legal spectrum, Werbel’s suit is part of a recent spate of consumer lawsuits targeted at U.S. nutrition industry that have cost food and dietary supplement companies tens of millions of dollars and counting.

As Laurie Budgar reports in an upcoming Nutrition Business Journal feature, many of these suits have been high-profile cases challenging the product claims made by the likes of Airborne, Dannon, Bayer, Snapple, General Mills, Coca-Cola and even Biggest Loser star Jillian Michaels. The celebrity trainer, who sells a range of detox and weight-loss products under her name, was sued in February 2010 by three different customers who claimed that the Jillian Michaels Maximum Strength Calorie Control failed to help them lose weight as advertised. One customer, who is seeking class-action status for her suit, took legal action after using the product for about a month.

Other recent actions have blitzed multiple companies simultaneously, such as the March 2010 suit filed in California against six fish oil manufacturers and two retailers, with allegations that their products contained PCBs at levels beyond the established “safe harbor” limit and that they failed to disclose this contamination to consumers.

For companies affected by such suits—even frivolous ones—the financial hit can be significant, according to Ivan Wasserman, a law partner at Washington, D.C-based Manatt, Phelps & Phillips, who specializes in matters involving the marketing of foods and dietary supplements. “The ultimate damage,” he told NBJ, “would be lost sales if the news of the case or settlement damages—rightly or wrongly—the public’s trust in the company and its products.”

Are lawsuits on the rise within the U.S. nutrition industry? What can companies do to protect themselves from becoming the target of consumer legal action? Check out NBJ’s 2010 Nutrition Industry Overview issue to find out. Not a subscriber? Go to the Nutrition Business Journal Website to sign up today.

Related NBJ links:

2010 Healthy Foods Report

‘Pixie-Dust’ Dosing Threatens to Erode Consumer Confidence

European Union’s Health Claims Legislation Sets Nutrition Industry on Edge

Tuna’s Prop 65 Win Could Help Supplement Firms in Their Own Lawsuits

Despite good intentions and a deepening understanding of nutrition and wellness, I know I’m not as healthy as I could be. As it turns out, I’m not alone. According to a new report published by Delicious Living and iVillage, most women in the United States see themselves as being only “somewhat” healthy—or worse.

“Although it may not be literally true that these women are ‘unhealthy,’ it is certain that the vast majority see room for improvement,” write the authors of the report, For Women, Healthy Is Not What You Think. “Thus, healthy food is not only intended to help maintain health; it needs to move them ‘in the right direction’ relative to their current states. This is true of younger women as well as older women.”

Published in April, the report is based on the findings from a survey of nearly 5,000 U.S. consumers—91% of them women—conducted in February 2010. The survey was designed to gauge the health attitudes, beliefs, priorities and purchasing behavior of U.S. women of all ages. From this research emerged many interesting findings about how female consumers define health and wellness; what drives them to pursue healthier choices at different points in their lives; and how these definitions and motivations affect their interpretations of label claims and ingredient attributes and purchases of specific products and brands.

Not surprisingly, U.S. women view consuming healthy food as the most important way they can support their own health and the health of their families. As a result, the majority of women say they avoid food products that contain trans fats, saturated fats, high fructose corn syrup and MSG. A smaller, but still significant, percentage of women say they avoid genetically modified foods. When evaluating label claims, the survey found that products labeled as “high fiber” are most sought out by women, followed by “reduced fat or fat free” and “low sodium.” These three claims and numerous others were ranked higher than both “organic” and “natural” by women of all ages in the survey.

Although I learned a great deal about how age and health conditions affect the beliefs, attitudes and behaviors of U.S. women from reading For Women, Healthy Is Not What You Think, perhaps the most eye-opening findings from the report had to do with perceptions surrounding natural and organic. For example, 67% of the survey respondents said they believe “natural foods are better for me,” while only 57% reported believing that “organic foods are better for me.” That said, those women who purchase organic products are more active and informed consumers and generally feel better about their health than other consumers.

Nutrition Business Journal will present a deeper dive into this and other consumer research related to nutrition, health and wellness, natural & organic products, and dietary supplements in our September 2010 issue. If you’re not yet an NBJ subscriber, visit our website to learn more.

You can also purchase or read the table of contents and executive summary of For Women, Healthy Is Not What You Think via the NBJ site.

Related NBJ links:

March 2010: Organic Foods, Beverages and Personal Care

2009 Healthy Kids’ Market Report: Breaking the Entry Barrier

Marketing to Busy Moms Requires an Integrated Approach

Eight dietary supplement manufacturers and marketers were named in a California lawsuit filed on March 2 that alleges some fish oil supplements have been sold containing illegally undisclosed and unnecessarily high levels of contamination with polychlorinated biphenyl (PCB) compounds. The eight companies named in the lawsuit are: CVS Pharmacy Inc., General Nutrition Corp. (GNC), Now Health Group Inc., Omega Protein Inc., Pharmavite LLC, Rite Aid Corp., Solgar Inc., and TwinLab Corp. The lawsuit alleges that the companies sold fish oil, shark oil, fish liver oil and shark liver oil supplements that have PCB contamination above the so-called “safe harbor” limits set for human PCB consumption under California’s Proposition 65. That law requires companies to warn consumers about contaminant exposures. Proposition 65, passed as a ballot initiative in 1986, was passed to force consumer products to eliminate toxic chemical ingredients or reduce them below published safe harbor limits in the past.

U.S. consumers spent $739 million on fish and animal oil supplements in 2008, making it the eighth most popular dietary supplement on Nutrition Business Journal’s list of the top 100 selling supplements in the United States. Many within the industry are wondering what the potential implications this lawsuit could have on the fish oil supplement market. NBJ reached out to two industry trade associations, as well as to legal experts with the Goodwin Procter law firm to determine what effect this might have on the industry; their responses are included below along with a statement from one of the defendants, TwinLab Corp.

• Forrest Hainline, attorney at the San Francisco office of Goodwin Procter: This threatened lawsuit highlights an essential problem in applying Proposition 65 to foods or supplements. The evidence is uncontroverted that omega-3 fatty acids are not only beneficial but essential for health. The evidence is overwhelming that Americans in general do not eat enough fish to obtain the appropriate amounts of omega-3 fatty acids. This might be due in part to the campaign to frighten people away from eating fish for fear of methyl mercury.

As the California Supreme Court recognized in Dowhal v. SmithKline Beecham Consumer Healthcare, 32 Cal.4th 910 (2004), “even if scientific evidence supports the existence of a risk, a warning is not necessarily appropriate: The problems of over warning are exacerbated if warnings must be given even as to very remote risks.” This is particularly true where the benefit of the product folks would be warned against outweigh the potential harm. This was true in the Tuna Case, which I tried and won. The benefits of eating fish (because of omega-3 fatty acids, among other benefits) far outweighed the remote and even theoretical risk of exposure to the minute amounts of methyl mercury.

The Food and Drug Administration (FDA), not a bounty hunter law firm under Proposition 65, should determine whether warnings on foods or supplements are appropriate, and what form they should take.

Note: Hainline also obtained a judgment for restaurants that Proposition 65 warnings concerning grilled chicken were preempted by federal law.

Joanne Gray, attorney at the New York City office of Goodwin Procter: I have provided legal advice to a number of dietary supplement companies over the years and have been continually disappointed at the number of frivolous lawsuits that have been filed against the industry, including Proposition 65 claims, consumer class actions claims and products liability lawsuits. It is important to mount a strong defense to these actions right from the start.

It is unfortunate that dietary supplement companies and retailers have faced Proposition 65 lawsuits, even when minute amount of substances hold no real risk of harm to the consumer. These lawsuits are a real threat to the survival of the smaller companies in the industry, and they also increase costs to consumers.

• Council for Responsible Nutrition (CRN): CRN believes the suit was filed in California in order to take advantage of a state law, Prop 65, which has conservative standards that are not law in the rest of the nation. Further, the information disclosed during the press conference danced around the details, offering a lack of specificity to the general public about the levels of polychlorinated biphenyl (PCB) compounds found in the fish oil products that were tested. Though the lawyers suggest that the levels of PCBs found in these products far exceed what is acceptable by Prop 65 standards, the actual levels of PCBs found in the majority of these products do not appear to exceed the Prop 65 limit (90 ng/day). Furthermore, they fail to mention that the Food and Drug Administration’s (FDA) tolerance level for PCBs in fish (2,000 parts per billion) far exceeds the levels of PCBs found in fish oil…

The bottom line is that consumers, whether they live in California or elsewhere, should continue to feel confident in the safety and efficacy of their fish oil supplements. This lawsuit does nothing to change the strong science supporting the many health benefits of fish oil, which range from cardiovascular health to cognitive development of infants and young children, and the very low thresholds of PCBs which apparently trigger a labeling requirement in California cannot be extrapolated to demonstrate any actual risks at those levels. The health benefits for fish oil far outweigh any suggested, and unsupported, risks.” Read the entire statement here.

• Global Organization for EPA and DHA Omega-3 (GOED): In response to a lawsuit being filed against eight dietary supplement brands and retailers, the Global Organization for EPA and DHA Omega-3s (GOED) is reassuring the industry and consumers that fish oils manufactured by its members, and the market in general, meet the highest quality standards available. “We have complete confidence in the safety of the fish oil supplement market, which has been validated through multiple third-party reviews by industry watchdogs on thousands of products,” said Adam Ismail, Executive Director of GOED. “In fact, this industry is among the highest quality and most transparent of all consumer products,” he added.

There are multiple resources in the public domain where consumers can get more information on the quality of their products, including the International Fish Oil Standards program (www.ifosprogram.com). Furthermore, a recent report by Frost & Sullivan found that 93% of the refined fish oils on the market in the United States are produced from anchovy and sardine oils. However, the plaintiffs unfortunately only tested one of these types of oils, which actually had PCB content well within the Safe Harbor provisions of Proposition 65. “While the plaintiffs raise an important issue,” said Ismail, “it is unfortunate that they are implying that most fish oils are unsafe and that the industry is hiding information on such vital nutrients.” Read the entire statement here.

• Greg Grochoski, Twinlab’s chief science officer: “Twinlab’s fish oil products are all molecularly distilled and quality tested for purity. These processes are especially effective for reducing impurities such as PCBs found in oceans, lakes, rivers and streams and common to fish and fish-­‐based products.” Twinlab’s statement went on to say that the company cannot comment on the validity or accuracy of the tests referenced by the plantiffs, though its products were reported as having among the lowest level of impurities.

Related NBJ Links:

Tuna’s Prop 65 Win Could Help Supplement Firms in Their Own Lawsuits

Elite Athletes Eschew Dietary Supplements Over Fears of Contamination

Vitamin D and Omega-3 Fish Oil to be the Focus of New $20 Million Study

A literature review article published February 1 in the Journal of the American College of Cardiology demonstrated once again how deep the misunderstandings over herbal supplements and how these products are regulated runs in the United States—and how important the work of industry trade groups, such as the Council for Responsible Nutrition (CRN), to refute such misunderstandings is today. The article, titled “Use of Herbal Products and Potential Interactions in Patients with Cardiovascular Disease,” warned that herbal supplements may be dangerous for people taking heart disease medication. It also argued that there is a general lack of science proving the safety and effectiveness of herbs.

CRN quickly responded to the review article, which triggered a round of negative mainstream news stories on the risk of herbal supplements. “This article represents a biased, poorly written and contrived attack on herbal supplements,” said Douglas MacKay, ND, vice president of scientific and regulatory affairs at CRN. “We question how a peer-reviewed publication would even accept an article such as this, given the fact that the authors make conclusions about ‘herbal remedies’ based on their own uninformed, inaccurate, and outdated interpretation of the law which covers dietary supplements, including herbal supplements. The article contains sweeping generalizations, often not backed by relevant citations, and copious factual errors, including a reference to products—some of which are not actually herbal supplements—that produce adverse effects on the cardiovascular system.”

CRN went on to point out how U.S. supplement regulations have been strengthened by the implementation of good manufacturing practices and the serious adverse event reporting law for all dietary supplements. “In the first full year that the law requiring manufacturers to report serious adverse events was in effect, FDA reported receiving 1,080 adverse event reports, only 672 of which were considered serious—for all dietary supplement products,” MacKay noted. “For the same year, FDA received over 526,000 adverse event reports related to drugs and biologic products, over 300,000 of which were considered serious, including close to 50,000 deaths.”

In a bit of good news for the industry, CRN’s communication efforts on this article reached reporters, many of whom included at least some of MacKay’s comments in their news pieces. It is this type of outreach that earned CRN a 2009 Education Award from Nutrition Business Journal. Media education was a key focus last year for CRN, which engaged with reporters and responded to inaccurate stories about the industry or the safety of supplements.

Such efforts help address a major concern for responsible supplement companies: protecting and enhancing consumer confidence, said Randi Neiner, director of market research for Shaklee Corp. “CRN has taken a responsible, fact-based approach to informing writers about the supplement industry and to correcting communications that misrepresent the industry,” Neiner told NBJ. “They continually correct the misunderstanding that our industry is not regulated and respond to misrepresentations of research results that are inconclusive or not representative of the totality of available data. They cite good science that supports responsible supplementation, while at the same time communicating our industry’s ongoing concern over questionable ingredients, studies and claims. This serves not only our industry but the consumer as well.”

Related NBJ links:

2009 Education Award: CRN

Fitzgibbon: Research Bar Being Raised for Supplements

Will JAMA Study Linking Folic Acid to Cancer Affect Consumer Sales?

Top 50 Herbs in the U.S.: 2000-2008 - Chart 83