FTC Commissioners Seem POM-Skeptical In Claims Hearing

“The idea that this company has built these health claims on bogus science is wrong,” says POM Wonderful counsel Edward Lazarus. But commissioners reviewing appeals of FTC’s challenge against POM’s claims for its pomegranate products appeared to believe the company made a number of implied disease claims.

Federal Trade Commission members, in their review of an agency decision on advertisements and statements made by [POM Wonderful LLC], appeared to lean toward upholding FTC attorneys’ opinion that POM ads make implied claims to treat, prevent or cure conditions including prostate cancer, Alzheimer’s disease and erectile dysfunction, which would establish the products as drugs.

In a rare formal hearing Aug. 23, the commissioners, sitting as a five-judge panel, considered arguments in appeals by both POM Wonderful’s attorney and the commissioner’s complaint counsel of decisions by FTC Chief Administrative Law Judge Michael Chappell.

In May, in an FTC complaint against POM and its executives – owners Lynda Resnick and her husband Stewart Resnick and the firm’s former president, Matthew Tupper – Chappell ruled that POM inadequately substantiated advertising claims for its pomegranate products. In a secondary decision that goes against complaint counsel, Chappell found that the FTC Act does not require randomized controlled trials to substantiate nutrient claims. The firm had piqued the agency’s interest with advertising that made cardiovascular and prostate health claims (Also see "Judge Knocks Down FTC Substantiation Bar In POM Wonderful Case" - Pink Sheet, 28 May, 2012.).

Chappell’s decision against the RCT requirement struck a blow against FTC’s preferred standard for claims substantiation, repudiating what some see as an elevated and unrealistic substantiation standard held by the agency, which contends it does not have the requirement as policy but applies substantiation standards on a case-by-case basis.

POM has focused much of its argument on its substantiation of claims for its pomegranate-containing products – POM Wonderful juice and POMx supplements – without evidence from randomized controlled trials.

During the hearing, each commissioner made comments to or posed questions to POM Wonderful’s counsel, Washington attorney Edward Lazarus, that touched on how and why the firm’s product claims should not be considered disease claims. The board’s questions and comments suggested the commissioners align with FTC’s complaint against the firm.

Disease Or Health Claims

“If all the ads literally said is ‘POM juice is healthy,’ I don’t think we’d be here today,” said FTC Chairman and panelist Jon Leibowitz, who was confirmed for a second term by the Senate in March.

“Maybe the world is watching,” Commissioner Julie Brill told Lazarus, “not just because of the potential that we will impose a requirement for RCTs and that that will be litigated, but rather because of the nature of the claims your client is making, which we’ve never seen before – that a juice will prevent cancer or a juice will treat cancer. Those are pretty strong claims.” Brill was appointed in April 2010 to a term that expires in September 2016.

Commissioner Thomas Rosch - along with Brill the most active questioners during the almost two-hour session - did not comment or ask about a need for RCTs to substantiate POM claims, but maintained that some ads for the products make implied disease claims.

“I see a bunch of implied claims in those ads,” said Rosch, on the board in his first term, which expires this month.

Lazarus argued that POM ads do not make implied claims, but speak only to the health benefits long recognized in the pomegranate fruit.

“There is a general scientific agreement that antioxidants are good for you because they fight free radicals and POM Wonderful has a lot of antioxidants,” he said.

Imposing the standard for substantiation sought by FTC would unfairly stifle POM’s ability to market its products, Lazarus contended. “If you set the standards too high, you are going to deprive consumers of information that is important.”

Rosch countered, however, that the board likely will not render a decision that eases the substantiation burden for health claims.

“There is a danger of setting the bar too high, but there is also a danger in letting you set the bar too low,” he said.

The Open Door

Rosch supported Chappell’s finding that the firm has not provided substantiation for some claims, particularly that ad claims for the POMx pill based on studies of POM Wonderful juice are misleading.

Lazarus argued for the POMx claim, noting the ads say a pill is equivalent to 3 ounces of the juice. “The science is, and the testimony about the science is, they are equivalent in terms of their use,” he said.

“The point is that we are entitled to say anything that’s true,” Lazarus added.

But Rosch interrupted: “No you’re not. That is the problem with the substantiation. We are not going to open the door to a deceptive substantiation claim here. We’re not going to do that.”

Rosch pointed out the commission does not accept substantiation for a pill based on evidence supporting claims for a liquid. He said POMx ads “highlight the pill and then they talk about substantiation for the liquid. Now that’s a complete misnomer.”

Commissioners Smell A Drug

While Chappell said FTC should not require RCTs for food products like those POM markets, which “were not being urged as an alternative to medical care or advice,” the commissioners made clear their disagreement with that finding.

Brill emphasized that the FTC Act determines whether a food product can be considered a drug based on the intended use promoted in advertising, not whether the product is sold on grocery store shelves rather than a pharmacy counter.

“It strikes me that the definition of drug that we need to comply with here makes quite clear that you can be a drug ... even though the product is a food,” she said, adding, “I think the ALJ got this completely wrong.”

Why should substantiation for a disease claim “be different simply because it’s a food?” said Brill.

Lazarus responded that health claims for nutrient products can be substantiated “in any number of different ways, not just RCTs.” The science noted in POM ads are “not the things of medicine,” but are presented in the context of a healthy diet and lifestyle.

He added that a consumer who says, “You know what, I’m going to take POM because it’s my silver bullet for cancer,” is not interpreting the ads reasonably.

FTC Takes Lumps, Too

While the commissioners acknowledged the role of clinical trials in health claim substantiation, they also questioned complaint counsel’s proposal that POM gain FDA approval of its claims on top of conducting RCTs, which Chappell had rejected. Complaint counsel argued that, as part of the order, POM should have to clear with FDA claims citing reduced risk of erectile dysfunction, heart disease or prostate cancer.

“We don’t want [POM] to be the judge of science,” said complaint counsel Heather Hippsley, an assistant director of FTC’s Division of Enforcement.

She pointed out FTC’s investigation showed POM executives ignored experts’ reports that refuted the findings the firm used for its claims. Requiring RCTs from POM “would still have them being the judge of the science,” Hippsley said.

Still, the commissioners were skeptical of requiring FDA’s collaboration.

“Doesn’t this impose a hurdle that is in fact too high?” said Commissioner Edith Ramirez, appointed to the board in April 2010 for a term that expires in September 2015.

“Do you have a plan B?” Brill asked Hippsley.

In 2010, FTC secured a requirement in settlements with [Iovate Health Sciences Inc.] and Nestle HealthCare Nutrition that the firms get FDA approval for disease claims, which marked a new settlement provision for FTC. In the POM case, however, Chappell said such a requirement “would constitute unnecessary overreaching” and stuck with a more FTC-appropriate standard of competent and reliable scientific evidence.

Hippsley argued that the remedy is appropriate for POM’s violations and the FDA-approval requirement would be only for POM products marketed with claims to prevent, treat or cure a disease.

“The test here is whether or not the remedy that we’re seeking … fits the facts of this case and the fencing that is needed to keep [POM] in line with the law,” she said.

“They persisted in claiming that POM prevented, treated or reduced the risk of a disease when they knew that the research results fell short,” Hippsley added.

Not only did the board have reservations about an enforcement action that would require another federal agency’s collaboration, Leibowitz also was skeptical of how promptly FDA would render a decision on claims POM might submit.

“How can we conclude with any confidence that the FDA would move with any alacrity even if the question could have a significant public health value?” the chairman asked.

However, he also questioned POM’s opposition to conducting RCTs. “Isn’t that the kind of investment that a reputable company like yours ought to be making or thinking about making before disseminating the claims to consumers?” Leibowitz said.

Brill also pointed out POM could use longitudinal studies, which are “considered to be pretty rigorous science,” to substantiate claims.

Lazarus did not discuss longitudinal studies, but maintained POM has adequate evidence to support its claims.

“The idea that this company has built these health claims on bogus science is wrong,” he said.

“Earned Media” Versus Advertising

The commissioners agreed that statements Lynda Resnick and Tupper made while promoting POM products on TV shows were unsubstantiated, but they voiced doubts about whether FTC regulations can prohibit such comments in venues where firms are not paying for air time or ad space.

If POM “hasn’t paid for it, tell me why the reach of the FTC Act should encompass this situation?” Leibowitz said.

As Commissioner Maureen Ohlhausen, appointed this year to a term that expires in September 2018, put it, the commission’s scrutiny of Resnick’s and Tupper’s media appearances should not start with whether their comments were accurate. “What we’re talking about is not whether it’s wrong or right, but whether this is commercial speech or non-commercial speech,” she said.

Hippsley responded that POM and other firms arrange “earned media” to promote consumer-specific products, not to discuss general topics. She noted Resnick authored a book that in part described her strategy for arranging to appear on TV shows as part of POM’s advertising.

“The evidence is that [POM] sought PR generally and that they worked very hard to get themselves in the press,” Hippsley said. In TV appearances, Resnick is “promoting her product. She’s not saying pomegranate generally,” she added.

Leibowitz also questioned POM’s argument that comments made in TV show appearances and news articles are protected by the First Amendment. Even “if it’s demonstrably false and designed to promote a product?” the chairman said.

Lazarus did not speak to the veracity of POM executives’ comments, but said, “It’s not commercial speech.”

He added that arranging to appear on a TV show or to be interviewed for a news article is not the equivalent of paid advertising (Also see "POM Wonderful Says Interviews Fall Outside FTC Advertising Scope" - Pink Sheet, 30 Jul, 2012.).

“You don’t control this medium. That’s a classic public forum,” Lazarus said.

An attorney for Tupper argued that he was not party to decisions to make certain claims that were later contested by FTC, but Hippsley presented a video of a TV show in which Tupper stated claims similar to Lynda Resnick. His comments “capture what the company’s message was to the public,” Hippsley said.

A second former POM executive, Mark Dreher, previously entered a consent agreement with FTC that restricts him from making unsubstantiated claims about food, drug or supplement products, pomegranate-based or otherwise. Dreher was POM’s head of scientific and regulatory affairs and frequent spokesman when he left the firm in 2009.

Under FTC policy, the board’s decision is due 100 days from the date of the hearing, which puts the deadline in early December. In the event POM, the Resnicks or Tupper appeals the ruling, the case would be filed in federal court; FTC, however, cannot appeal.

[Editor’s note: This story was contributed by “The Tan Sheet,” your source for nonprescription pharmaceutical and nutritional industry news. For more information call 1-800-332-2181. To register for a free trial, click here/ – no credit card needed.]