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Fraudulent supplements sold on Amazon pose risks to vendors, customers: experts


According to Market Intelligence, December 2022


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Fraudulent supplements sold on Amazon pose risks to vendors, customers: experts

Two years ago, Jim Emme noticed brands he had never seen before popping up in searches for dietary supplements on Inc.'s website. Many claimed to have the same active ingredients as products made by NOW Foods, the Bloomingdale, Ill.-based company he leads as CEO, but carried lower price tags.

Intrigued, Emme bought some of the products, analyzed their contents and confirmed his results with third-party labs. Not only did many of the products not contain what they claimed, many contained potentially harmful substances such as chromium and pesticides, he fund.

Emme estimates that he saw about 50 adulterated products on Amazon in the first half of 2019.

"It was happening before, but it's become prevalent," he said, adding that his company began contacting federal regulators after raising the concern repeatedly with Amazon, where NOW also sells products.

In recent months, Amazon has implemented several initiatives to combat counterfeit products. But experts say the proliferation of items masquerading as nutritional supplements — many of which do not mimic intellectual property in the way that counterfeits do — presents potentially grave consequences for business and public health.

"You definitely have to be more careful with any product you ingest," CJ Rosenbaum, a partner with Rosenbaum Famularo PC, said in an interview. His law firm represents thousands of Amazon third-party sellers, including those who sell supplements.

An Amazon spokesperson said in an emailed statement Oct. 1 that Amazon has taken "proactive measures" to prevent suspicious or noncompliant products from being listed on its online platform and monitors the products sold in its stores for safety concerns. Amazon did not respond to a request for comment on NOW's experience.

"If customers have concerns about an item they’ve purchased, we encourage them to contact our customer service directly so we can investigate and take appropriate action," the spokesperson said.

Adulterated supplements are not unique to Amazon or online retailers. Scott Bass, a partner at law firm Sidley Austin LLP who was involved in developing the Dietary Supplement Health & Education Act of 1994, said that inaccurately marketed and labeled products have popped up at online retailers as well as brick-and-mortar retailers for decades.

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Advertising claims don't always match reality

As with other consumer products, Amazon has established a commanding role in the supplements business. About 77% of online supplement sales by dollar value took place on the e-commerce giant in 2018, according to the Trust Transparency Center, a consulting firm that works with supplement-makers that sell on Amazon.

On Amazon, consumers face no shortage of choices. During the second quarter of 2019, the retailer listed 17,840 supplement and vitamin brands on its website — a wider variety than was available on any other online source, according to data from the transparency center.

But many of those brands are selling products that do not live up to their labels, according to Scott Steinford, managing partner at the center. Tests of 100 products on Amazon claiming to contain coenzyme Q10 showed that nine contained no more than 9% of the amount that the seller claimed, according to the CoQ10 Association, a trade group representing makers of supplements that include the ingredient. CoQ10 can benefit people with congestive heart failure or Parkinson's disease.

A similar test of 50 products on Amazon that allegedly contained astaxanthin, an antioxidant believed to reduce inflammation and fatigue, reached the same conclusion for 21 of the items. Amazon did not respond to a request for comment on the studies.

Many vendors listed supplements alongside a wide range of other nonperishable products, such as clothing, and appeared unfamiliar with how to vet supplements for quality, Steinford added.

Supplements that are effectively sugar pills may not present a health risk, Steinford said, but they do threaten consumer trust in supplements and willingness to repurchase.

"This is more of an advertising issue than a safety issue. Amazon is the one that has benefited tremendously," he said.

Rosenbaum added that it can be difficult for a third-party seller to prove that a product is a dupe because the ingredients themselves are not fake.

"As long as it's really Vitamin C, it's not a counterfeit anything," he said. "There's also a tremendous amount of large companies that kind of take advantage of that, and they will try and take down smaller mom-and-pop or startups that are selling the same Garcinia cambogia."

Third-party Amazon businesses that sell supplements are reluctant to bring the issue to light for fear of retaliation from the online giant, Rosenbaum said, adding, "All the sellers across the board are afraid of poking the bear."

FDA to the rescue?

In the U.S., selling supplements that are misbranded or do not contain the ingredients listed on the label is against the law, according to the Food and Drug Administration, or FDA. But the FDA does not require supplement manufacturers to register or clear their products before putting them on the market — something it does require for prescription drugs.

That could change if Congress and President Donald Trump approved a proposal that would require all supplements sold in the U.S. to be listed with — though not approved by — the FDA. The listing requirement is part of the FDA's budget request for the 2020 fiscal year.

"If we see a product that isn't registered, it's very easy to know that it shouldn't be on the market," Lowell Schiller, the FDA's principal associate commissioner for policy, told an audience at a conference hosted by the Natural Products Association in September.

"It'd be much easier to send a letter to Amazon," he added later.

The number of legitimate supplements has exploded in recent years for both online and in traditional retail, said Sidley Austin's Bass. That has made it more difficult for the FDA to take action against makers of fraudulent supplements.

"There is no one source where most of the unscrupulous companies are coming from," he said in an interview.

Industry groups representing supplement-makers are divided on the proposal. Jay Sirois, senior director, regulatory and scientific affairs at the Consumer Healthcare Products Association, said that not having a list of supplements makes it harder for the FDA to go after dangerous or illegal products.

But the association is waiting for details on how the FDA would compile and use the list, he said, adding, "The industry wouldn't be in favor of this being some sort of a pre-clearance mechanism" that would require manufacturers to receive approval to sell their supplements.

Daniel Fabricant, CEO and President of the National Products Association, said requiring all supplements to list with the FDA represents "a TSA-type solution," referring to the practice of screening all airline passengers at U.S. airports for security. He pointed to existing powers, such as mandatory recalls, that the FDA could use to pull potentially dangerous supplements from the market.