In 2022, the Food and Drug Administration (FDA) and related
regulatory bodies will continue to balance emergent public health
issues related to the COVID-19 pandemic with
“conventional” oversight obligations. Our Agribusiness
and Food industry team has compiled its annual overview of key
issues that may impact related industries throughout the year.
COVID-19 Related Matters
Stating the obvious, the pandemic will continue to impact
individuals and companies in immeasurable ways. Some of the
explicitly related regulatory matters in 2022 will include:
- Recent extension of the Public Health Emergency (PHE),
effective Jan. 16, 2022, through April 16, 2022. The PHE has been
renewed more than half a dozen times. The PHE triggers increased
access to categories of federal funding for local authorities and
allows for the waiver of certain regulatory requirements. - Attention to economically motivated raw material adulteration
in the face of ongoing supply chain delays and disruptions. - Ongoing use of FDA’s authority to issue Emergency Use
Authorizations (EUAs) to accelerate the development of treatment
therapeutics, vaccines and tests. EUA review is a mechanism used to
facilitate the availability of medical treatments and
countermeasures during public health emergencies. Although EUA
authority enables the FDA to allow the use of unapproved medical
products, or unapproved uses of approved medical products, in
emergency circumstances, it does not obviate rigorous testing of
such products. - Continued emphasis on production of Personal Protective
Equipment (PPE) and over-the-counter testing options.
Pending Export Issues for Domestic Producers
Epic supply chain disruptions, border closings, enhanced
emphasis on supplier qualification and traceability—it is a
vast understatement to suggest the international flow of food and
agricultural products is in a state of flux. Notably, with respect
to certain key export markets for domestic producers, there are
still more challenges to reaching those markets in 2022.
China: Effective Jan. 1, 2022, the
General Administration of Customs of China (GACC) issued Decrees
Nos. 248 and 249 (Decrees), which set out new requirements for the
registration of qualified foreign food producers that are allowed
to export food products to China. Decree No. 248 requires all
overseas food manufacturers, processors, and storage facilities to
be registered with the GACC. Under Decree 248, 18 categories of
food, such as meat and aquatic products are subject to registration
as recommended by the competent authority of the home country of
the exporter. In addition, the GACC issued Decree No. 249 which
provides new enforcement tools for the GACC to inspect food
imports, and suspend or prohibit food imports into China when
violations are identified. At this point there is no indication of
an interim safe harbor to allow exporters who have not already
begun the registration process to come into compliance, effectively
halting imports of those products. The GACC Decrees make it
apparent that the Chinese government intends to expand its scope of
supervision over food supply chains to include operations outside
of China. In looking forward, in addition to the compliance
challenges which arise from the new Decrees, companies exporting
food need to focus on the compliance risks and challenges involved
in such pre-importation operations.
Canada: The transition period for the
2016 nutrition labeling changes were set to end on Dec. 14, 2021.
Given, however, the challenges imposed by COVID-19, the Canadian
Food Inspection Agency (CFIA) will focus its efforts on education
and compliance promotion for the first year, until Dec. 14, 2022.
As of Dec. 15, 2022, CFIA will verify compliance and apply
enforcement discretion in cases where noncompliant companies have
detailed plans showing how they intend to meet the new requirements
at the earliest possible time. Other regulatory initiatives (like
Front of Package Labeling) continue to be on hold. Delayed
enforcement was extended for Safe Food for Canadians Regulations
requirements that came into force in July 2020 for the manufactured
food sector. United States-Mexico-Canada Agreement (USMCA)
certification of origin requires the certifier (importer, exporter
or producer) to cover nine mandated minimum data elements,
replacing the old North American Free Trade Agreement (NAFTA)
certificate of origin.
Effective March 1, 2022, amendments to the Canadian Medical
Device Regulations (CMDR) will require Medical Device License (MDL)
and Medical Device Establishment License (MDEL) holders for certain
Class I, II, III and IV devices to report shortages of their
devices and/or device components and accessories to Health Canada.
The amendments will also authorize the Canadian Minister of Health
to require manufacturers, importers and/or distributors to provide
data regarding device shortages.
Mexico: Effective June 1, 2021, Mexico
made amendments to the Health Supplies Regulation (Reglamento
de Insumos para la Salud RIS, which also includes the
regulations for Medical Devices). These amendments (1) eliminate
the obligation to translate English documents into Spanish and (2)
allow for more simplicity in the renewal process. Prior to these
changes, any registration had to be renewed every five years.
Currently, no further renewals are required unless there are safety
issues with the product.
EU: On May 26, 2021, a new EU medical
device regulation (MDR) entered into force. The EU MDR is greatly
expanded to cover more devices, including Software as Medical
Device, implantable devices, contact lenses, and many digital
health technologies. It also promotes a lifecycle approach to
regulation. EU MDR requires improved device traceability by
introduction of a unique identification system, or UDI, for medical
devices approved for use in the EU. To keep track of devices
through every lifecycle stage, a device identifier (UDI) will be
assigned, and all production series will be marked with a
production identifier. The regulations also tighten the rules for
testing medical devices on patients to ensure the availability of
documentary evidence of device testing. In addition, manufacturers
of medical devices must meet stricter requirements with regard to
following up on the quality, performance and safety of devices. A
new in vitro diagnostic medical devices regulation (IVDR) will
follow this year, entering into force on May 26, 2022. In vitro
diagnostics are tests done on samples such as blood or tissue and
can be used to detect diseases or other conditions.
Consumer Fraud Claims
Class actions targeting highlighted ingredients (ex. vanilla),
health representations, and—the perennial
favorite—”all natural” statements on human food and
animal food product labels will likely remain a plaintiffs’ bar
darling in 2022. These types of cases exploit broad state consumer
protection laws (with attractive attorneys’ fees allocations)
to claim that consumers have been deceived, misled or otherwise
damaged by food, beverage, supplement or pet food manufacturers.
Although these lawsuits have typically focused on labeling claims
that fall within definitional gray areas or silence from the FDA,
plaintiffs’ attorneys have also increasingly targeted
“healthy” food products. Although products may
technically meet the FDA’s metric for a healthy product (low in
sodium, fat, and cholesterol), certain lawsuits have made a more
holistic assessment as to whether a product is healthy.
Oftentimes, when food and beverage companies receive a demand
letter threatening a consumer fraud class action as a result of a
labeling claim, the calculus whether to fight an unreasonable
demand or settle is frustrating because the case could easily
survive motion to dismiss and result in significant fees. As
result, even though clarified regulatory standards around the terms
“natural” and “healthy” would be helpful, it
may be equally useful for food and beverage companies if federal
judicial circuits like the Ninth and Second circuits opt to dismiss
unreasonable consumer fraud claims early and further develop a
“reasonable consumer” standard.
Enforcement Actions for Market Opportunists
In 2022, we will likely see fallout from the proliferation of
personal and surface area cleaning products on the market. The
COVID-19 pandemic motivated companies to rush to market with
sanitizing products to satisfy consumer demand. Depending on the
purpose of the products and nature of claims made, these products
are subject to extensive regulation by the EPA, FDA, and state
bodies. Regulators and plaintiff’s attorneys have already begun
to target producers and distributors of these products who were
less than rigorous in evaluating and supporting labeling claims
(ex. “kills 99.9% of bacteria”) and meeting defined
product formulations (ex. limits on volatile organic compounds
(VOCs)).
In particular, violators of the Federal Insecticide, Fungicide
and Rodenticide Act, known as FIFRA, may hear from the EPA in 2022;
new market entrants making pesticidal claims are often not familiar
with EPA’s strict regulation of requirements. New pesticide
products require a significant lead time to get through the FIFRA
approval process and, although EPA has an expedited review process
for COVID-19 disinfectants, it continues to closely regulate labels
and claims, including the iconography.
Enhanced Regulation of Dietary Supplements
Consumer safety advocates want the FDA’s supplement
regulatory capabilities to keep pace with the growth of the dietary
supplement industry. They may make headway on this goal in 2022 by
securing funding for the Office of Dietary Supplement Programs
within the FDA and by developing a framework requiring
“mandatory product listing.”
The FDA has been active in issuing Public Notifications with
respect to products making unsubstantiated health and benefit
claims in violation of the Food, Drug and Cosmetic Act. Some of
these Public Notifications focus on dietary supplements the FDA
believes to contain “hidden drug ingredients.”
Specifically, the FDA continues to object to cannabidiol (CBD)
infused products to be sold as dietary supplements. Unfortunately
for manufacturers—and consumers—of such products, there
remains uncertainty as to the market viability of CBD products and
any notion of a standard for safe levels of consumption of CBD.
Although the FDA continues to tout its Cannabis-Derived Products
Data Acceleration Plan (last updated in October 2021), there is
clear hesitancy from the FDA to issue any new regulation to allow
CBD-infused products to be marketed as dietary supplements. The
lack of clarity in regulatory oversight has likely led to a flood
of products on the market of varying potency and quality.
Circumstances may not change absent congressional action.
At the state level, certain legislatures are moving to address
what they see as an unfettered marketplace for dietary supplements.
In one specific instance, there is an effort to limit the sale of
dietary supplements that are targeted for weight loss or muscle
building to minors. State legislators in California, Illinois,
Massachusetts, Missouri, New Jersey, and New York cite eating
disorders and constant content on social media as contributing
reasons for introducing such legislation.
Compliance Deadline for USDA’s National Bioengineered Food
Disclosure Standard
The National Bioengineered Food Disclosure Standard (NBFDS)
promulgated by the USDA outlines labeling and disclosure
requirements for bioengineered (BE) food products. 7 CFR Part 66.
As noted in previous updates, the labeling compliance
deadline for producers, importers and retailers with human food
products subject to NBFDS was Jan. 1, 2022.
With respect to the NBFDS, the USDA’s enforcement options
are effectively limited to public disclosure of the results of an
investigation following a hearing for a noncompliant regulated
entity. In other words, as of now, USDA may not require a recall or
issue fines for failure to make a BE labeling disclosure. However,
it should be noted that public disclosures of noncompliance with
NBFDS will likely be closely watched by competitors and
plaintiffs’ attorneys.
Anticipated Guidance for Standards of Identity and Fair
Labeling
Plant-Based Milk: In June 2021, the FDA
indicated that by June 2022, it intended to issue guidance on
“Labeling of Plant-based Milk Alternatives.” This
includes soy milk, almond and the increasingly popular oat milks.
The comment period is still open. The “milk” debate has
continued for years, especially as more plant-based milk products
have come to market. Dairy producers seek to enforce the standard
of identity for milk, which is limited to lacteal secretions of
cows as—in their view—plant-based beverages identified
as “milk” have implied nutritional equivalency with milk.
Proponents of dairy milk alternatives claim that it is unlikely
consumers are misled when “almond” or “oat”
appears before milk.
Alternative Proteins: In September 2021,
the USDA’s Food Safety and Inspection Service (FSIS) issued an
advance notice of proposed rulemaking (ANPR), seeking comments
regarding the labeling of meat and poultry products made using
cultured cells derived from animals. The USDA and FDA entered an
agreement to oversee products made using animal cell culture
technology derived from cells of poultry and livestock. The FDA
will oversee the cell collection and growth. Cell harvest,
processing, packaging and labeling will fall to FSIS. Those in the
agribusiness and food industry are awaiting guidance from the USDA
and FDA following the comment period, which has now ended. The
industry is particularly focused on the standards of identity for
these products.
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