Ever wonder how DSHEA became the regulatory framework for the dietary supplements industry? Join pioneers Patricia Knight, Scott Bass, and Loren Israelsen — three of the most influential people who advocated for this legislation in 1994 — as they share stories on how they got it done and why the industry can benefit from its modernization 27 years later.
- Episode Transcript
Welcome to CHPA Chat, conversations in the consumer healthcare industry with Anita Brikman.
Anita Brikman: Have you ever wondered how DSHEA became the regulatory framework for the dietary supplements industry? Well, we're going to answer that question. Join Patricia Knight, Scott Bass, and Loren Israelsen, three of the people who advocated for this legislation way back in 1994, as they share personal stories on how they got this done and why the industry can benefit from its modernization 27 years later. John, take it away.
John Troup: Thanks, Anita, and thanks to our listeners for joining us in our CHPA Chat podcast. This series of dietary supplement-specific discussions is going to be a really great one. I have to say, I've been looking forward to this since we had a chance to schedule this thing. We're going to talk about DSHEA. For those of you who are fully engaged in the dietary supplement category, you've heard DSHEA Modernization or DSHEA 2.0, and we talk a lot about that. But we thought it would be really helpful for our listeners in particular to go back and look at, well, what was going on in '92 to '94 and DSHEA 1994 happened. How did it happen? Today there's an estimated 70,000 products on the market. An estimated 70% of Americans use a dietary supplement at least once during the course of the year.
But back in 1990, believe it or not, there were only about 4,000 products, only about 500 companies that were selling products. Back then only an estimated 40% of consumers were using dietary supplements. In the last 26 years we've experienced this explosion of growth in a category that actually makes a big difference in the lives of the consumers that use the products sold. We went back and revisited what happened in 1994 in particular, and who were the key drivers that helped facilitate and even accelerate the introduction of the legislation and pulled all the levers to make it come alive. I'm so excited and proud to be sitting here with three of the most influential people that completely changed the trajectory of the dietary supplement category in America, if not the world.
First we have Loren Israelsen who is the president and CEO of, back then it was called the United Natural Products Association. At that time, Loren, you were a staff member of Orrin Hatch, and I think running the State of Utah, his office, at that time. Today, by and large, you're still involved in the industry as CEO and president of UNPA, now called United Natural Products Association. Welcome. We have Patricia Knight who back then was the chief of staff for Senator Orrin Hatch. For those of you not around in 1994 following the category, Senator Hatch was this main sponsor of the bill, and Patricia was the person on his staff that actually pushed it through and made it happen. Today she's still actively involved in dietary supplement category and runs a government relations advocacy firm. Patricia, thanks for being with us.
Scott Bass, who's currently the partner in charge of life sciences for the law firm, Sidley Austin, and back then was in private practice still, but representing a large number of industry interests. Scott, welcome. Thanks for joining us. The three of you in 1992 to '94 worked pretty closely together and really orchestrated it all. Let me start, Loren, with you first and maybe you could paint the landscape for our listeners on what brought about the opportunity to push through DSHEA at that time, and how did you get it done?
Loren Israelsen: Well, John, thank you for the chance to bring Trish and Scott and I together, that is always a pleasure. Trish works closely with UNPA as our senior political advisor and Scott and I stay in regular contact after all these years. We are not only colleagues, but we are real friends. We go back into this the pre-DSHEA era. It was somewhat medieval in terms of what was going on as an industry. We were in dark times. We should actually roll it back further, is that the DSHEA period was just the latest in a series of these sorts of legislative battles that had started as early as the 1930s, and then again in the 1970s. There will be some that will recall the Proxmire Amendments of 1976. That created a category to try and help protect nutrients that were otherwise FDA was trying to drive them toward OTC drug status, and they would have lost their dietary supplement status, if that word existed then.
There was a ramp-up long before 1992 when the first DSHEA bill was introduced, which was actually called the Health Freedom Act. We decided we needed something that had a little more sizzle, a little more clarity of meaning to both attract the audience of consumers that were very concerned about their access to supplements. But here are some of the things that happened. In 1990 Congress passed the Nutrition Labeling Education Act. Turns out it was a very good piece of legislation, but it did one thing that really was a problem for the supplement industry, it created nutrient content claims and health claims. This was all based on disease nutrient relationships. A new class of claims were created, but you had to be a nutrient. No nutrient, no claim. Then nothing else was permitted.
Well, that locked out a whole lot of dietary ingredients, especially the herbal product sector. They were in big trouble. Then there came the Dykstra Report, which was the infamous report that was initiated by then commissioner David Kessler. This was to examine, what would FDA do if it were to start over and establish a regulatory regime for dietary supplements? Well, at first that was going to be an internal report. News leaked out that it was something was going on and under tremendous pressure when the report was done it was released. To, not our surprise, because we thought that there would be bad news. Indeed, FDA basically said, "We think that herbs are drugs or amino acids. Nutrients are okay, but pretty much everything else should be treated as a drug or a food additive."
Then we had the Jonathan Wright FBI raids. This became an infamous moment that many people today probably have never heard of, but this was a bust, not a drug bust, of a medical doctor in Washington State that was giving B12 injections. Literally, one day the FBI broke the door down, flak jackets, guns in hand, everybody on the floor. He was charged for giving patients B12 injections. There was a series of things that were going on that became ever more alarming. I am based in Salt Lake City, Utah. I've been here for many years. As many know, Utah really was a geopolitical center of the industry for many years and continues to be. In 1991, late '91, I called a number of our company executives here locally and said, "We really have to do something." There were a growing number of raids against individual products. The tensions were rising, NLEA had passed.
We had gone to FDA in a series of meetings that included Scott and many others who were involved in talking to FDA, to no avail. They were not interested in hearing about our concerns and said, "If you don't like what we're doing, go talk to the Congress." Good idea. That was the impetus for DSHEA literally, was FDA said, "We're done talking to you. Next stop is Capitol Hill." We put our thoughts together and here we, like other groups, were developing thoughts and had a legislative draft that we thought could be the beginnings of what could be legislation. I met with Senator Hatch and he quickly agreed to support this idea. He said, "Get yourselves a Democrat in the House and let's get going." That's an abbreviated beginnings, but there was a lot of ferment and a lot of fear. There was a lot of confrontation and it was really ripe for something to happen.
As we know now, it became one of the greatest populist movements as it relates to legislation that we have seen in modern times. A quote that many have heard, which is true, is that there was more constituent contact to Congress around DSHEA than anything other than the Vietnam War in the memory of Congress at that time back in the 1990s. That's quite an extraordinary statement given all of the other things that were going on.
Patricia Knight: Just to tease out some of the key facts of what Loren's saying is there had been this decades long history of animosity against dietary supplements by the FDA. They really didn't know what category to put them in, how to regulate them, and approve drugs, food additives, foods. There were court cases Scott can talk about if he cares to. There was a lot of turmoil in how the products were to be regulated. The interesting part about that is, because of Loren's background, and the fact that it's such a huge industry in Utah, and the fact that Senator Hatch was positioned as an advocate because he personally believes in dietary supplements. He believed in health freedom. He was on the relevant committee, the Labor and Human Resources Committee that had jurisdiction over the FDA, that this all came together just at that precise right moment.
John Troup: Trisha, tell us, so Loren got everybody organized primarily in the state, as you said Loren, the epicenter of the dietary supplement industry largely was in Utah and Utah-based companies. It landed in Orrin Hatch's office and then it was the chief of staff and a staff member, Patrician Knight. I can only imagine, tell us a little bit about that personal side of the story though, Trisha. It's like, how did it land on your desk and what did you think. Did you think, "Oh, this is going to be awesome." Or like, "Oh my God, what did he create?" I mean, how did that happen?
Patricia Knight: Well, I started in Hatch's office the day after Clinton was inaugurated. I had been working at HHS in the legislative office. A friend of mine, Ann LaBelle was staffing Hatch on this and so she would call and ask me questions about information the department had about dietary supplements. Very interesting that there wasn't anybody who was really, aside from FDA regulators, anybody who knew anything about dietary supplements. That was where we ended up putting the Office of Dietary Supplements at NIH, is to try to build that body of knowledge based on that experience we had then. I started as a volunteer, quickly saw that this was something Senator Hatch was passionate about. I got promoted or hired and then Anne left to go over to the Ways and Means Committee and I became his health policy person. All of the supplement stuff landed in my lap.
I have to say, it was really frightening because I knew he cared so much about it personally. So complicated, the history, FDA regulations, FDA law, and that's where I think Scott and Loren came in. They were so helpful in helping inform us about the intricacies of the law, where FDA might be pushing things, where things needed to be clarified. But I was scared to death when I first inherited this because I knew how much Senator Hatch cared about it.
John Troup: What is the background, by the way, with Senator Hatch's interest in efficacy for dietary supplements? By the way, the second part of that question, if you'd answer it is, who's going to replace Senator Hatch as we move forward as a category and as an industry?
Patricia Knight: I say this fondly, he's a health nut. I mean, he exercises, he would come in every morning at 5:00 AM and do StairMaster at the highest level for an hour. He was very into supplements and had been for years, probably decades, and how each one worked and what it would do. He studied that and it was a personal interest. Of course, that aligned with the fact that it was a huge industry in his state.
John Troup: Wow. Is there anybody like that currently in the Senate or in the House or?
Patricia Knight: The closest one I believe is Kyrsten Sinema who is now a Senator, was a House member and unfortunately not on any relevant committees. But she's been out to you UNPA a couple of times, she's met with our members. She's very into, she's a runner, a sports enthusiast, and she is really knowledgeable about supplements.
John Troup: Great. Scott, you basically grew up in the dietary supplement industry long before 1992. Your earliest experiences in the law was involved in the dietary supplement category. Tell us, where were you in 1992 and what were you doing? What was your first interface and recollection of getting this? Tell us a little about, if you would as you tell us your story, how did you meet Loren and Trisha-
Scott Bass: Well, first of all, thank you John. I met Loren who has remained one of my dearest friends, and so has Trish. I met him in 1990 because I was the general counsel of the largest trade association at that time, the National Nutritional Foods Association, which represented thousands of retailers. In those days, most of the products were sold through very militant and enthusiastic retailers. Interestingly, you used the word epicenter to describe Utah at that time. It was actually the epicenter of the DSHEA effort, but only one of the three centers of the dietary supplement industry. The supplement industry actually started in Chicago in the 1930s, moved out to California in the '60s, and then New York established an enterprise zone, meaning people could save money, in the 1970s, where most of the industry congregated. It was New York, Utah, and California.
But just to put a little color on that, I had not known Loren. I knew of him. I had met him. But we became dear friends very quickly working together on NLEA because that 403 R5, the provision that Loren referred to in NLEA which said that FDA can create different health claims for supplements under a different scientific standard. Then I remember very well to this day calling Loren. We were representing different associations, but in December of '91, as Loren described, I said, "Loren, this is the shot across the bow, isn't it?" He said, "You bet. Utah's rising." That's really, John, what happened, and Loren and I have worked together closely since really, and have remained, as he said, very dear friends.
I met Trish in one of those two by two square rooms in the Senate office building the first time and I was blown away at how much she knew, and also her strange sense of dry humor, which has also persisted. Loren and I worked with her through the end. I think the story Loren and I both love to tell is, at the very end with her leadership when the bill was about to die, a week before it passed, they squeezed as usual 900 people. Now, it's 12 people into this little room that sits six. We were forced to spend eight hours straight in an airless room. My outdoors macho friend from Utah, I said, "Do you want to share a sandwich?" He said, "No, no, no, I'm good." Three hours into the meeting the guy who was dying. I just surreptitiously slipped him half a sandwich, and of course we went on to get the bill out the door with Trish as another help.
But this is the kind of thing I participated very actively as the general counsel within NFA and met 100 times with Loren, Trish, FDA, et cetera, and industry. It was a very interesting point John, people don't know then leading trade association, not the biggest but the leading one in Washington, actually tried to kill the bill twice. Something that's not known. Well, I think we can keep that discussion now, but let's just say that somebody got a large bonus for passing a bill when he was instrumental in trying to kill it twice. Loren, Trish, and I would talk about this and say, "Okay, this is politics as usual." In addition to the stories, Trish will tell you about how it passed or Loren about the constituents. I think that's the most colorful part to me other than the friendships and also the failure, success, failure, success.
Meeting, Loren and Trish you remember, in Congressman Richardson's office in September of '94. You may remember that when it was supposedly all over. It was an up and down process that actually extended past the closing of the Senate, which they can tell you about.
Patricia Knight: Let me talk a little bit about the process because it was really an education for me, although I'd worked on the Hill and around the Hill for a long time. Senator Hatch had worked with the principal people who would be in the Senate, Senator Kennedy. Senator Harkin course came early on and helped immeasurably. In the House it was John Dingell, the longtime chairman, powerful Energy and Commerce Committee and Henry Waxman, the chair of the health subcommittee. Hatch had done a number of bills with them. He had been the chair of the Labor Committee in the '80s and so he knew how to work with them. He said, I give him total credit. He said from day one, "I know Henry Waxman. He does not want this bill and he will string it out to the very end, but we'll make a deal."
His strategy in working with Senator Harkin was to get a bill drafted and then we worked with Congressman Richardson to have the same bill drafted on the House side, and then to solicit co-sponsors. He meticulously went to the floor. He had a clipboard. He would go up to people, "Are you a sponsor of this bill yet? Let me tell you what the FDA is doing. It's bad. It's very bad." At the same time, FDA was in an interesting position because David Kessler, the FDA commissioner, had been a staffer of Senator Hatch's. He had a great deal of respect for him and didn't really want to take him on in the open. FDA was, through the Democratic staff on the Hill, trying to offer suggestions on this bill, but not overtly working with us. We started with this bill and Hatch and Harkin meticulously got co-sponsors until they ended up getting a majority of the Senate and a majority of the Committee.
In the House, Richardson was able to get a majority, eventually, of the house, the subcommittee and the full committee yet Waxman still wouldn't bring it up. Hatch went to Kennedy and literally followed him around the Senate floor until he would talk to him and he asked for a hearing. Kennedy gave him, they had a great relationship and that was another key element here. He gave him a hearing. The Democrats controlled the committee then, but Kennedy was very deferential and let Hatch ask all the questions he needed to. I remember it completely because a couple months earlier, Waxman had had a hearing with David Kessler and Kessler had hastily put together this report where he had CSOs go to stores and find products that he said were a problem.
We had an idea. We did a staff report of that report and we pointed out the tremendous amount of errors in what FDA had done. We issued a report at the hearing called False and Misleading, which took Kessler back, threw him back on his heels. One thing the FDA had cited as a supplement was a book. There were a bunch of stores that said they didn't even sell what they were cited as selling and it made a big splash. I think after that hearing, Jeff Bingaman, who was a Senator from New Mexico, came on board. He said, "I see now that the FDA is not playing fair with this industry." He was the one person we needed to have a majority of the committee, being co-sponsors of the bill. Then Hatch kept working with Richardson, more co-sponsors. He went to Kennedy and said, "I need a markup of this bill. We got to bring it up. We got to markup?"
Kennedy felt that he had to offer a substitute and he got, I can't remember, it was two or three votes and it was, reportedly, the first time he had lost and maybe the only time in his own committee, and our bill was reported. Then Hatch and Harkin went to Kennedy and said, "We've got the bill now let's bring it up on the floor." At the same time, Waxman was saying, "No, no, don't go so quickly." But Kennedy is like, "I can't hold Hatch off." He had the bill brought up and they allowed Senator Hatch to bring it up on the floor by unanimous consent and it passed one night by unanimous consent. We had a dormant period where we tried to work with the House and identify issues that had to be worked out and things didn't really go that well. We got to literally the end of the Congress the last day and Richardson's staffer called me and said, "I just saw Bill Schultz," who was Waxman's counsel and [legislative] counsel. "He says, we'll have a new draft by the end of the day."
We're like, "What?" They gave us a draft and it really contained the framework that we wanted. The members hastily convened a meeting, as Scott alluded to, in Congressman Richardson's office in the Capitol because he was in leadership. Literally, the final bill was negotiated by Dingell, Hark, and Hatch, Waxman, Kennedy and things happened there. The Imminent Hazard Authority we offered to add because Dingell was still a little worried that unsafe products could still be on the market. Waxman literally wrote the disclaimer that it has to accompany a supplement. This is not intended to blah, blah, blah. Waxman wrote that at that meeting and that was put in. We raced to leg council to get the changes put into legislative language. It was, Waxman brought it up on the floor that night by unanimous consent and Hatch brought it up the next day, the last day of the Congress, by unanimous consent.
It ended up being one of only a couple of bills, health bills. It was enacted that year, and that was the year that the Clintons were pushing the Health Security Act, so it was a big contrast.
John Troup: Wow. That's amazing. Loren, what one or two points of the bill do you think were the hardest to get yet the most important even today? I mean, the work that Trisha described was just incredible, but what were really the key points that you were trying to advocate for industry that you're most proud of or pleased that you got it in?
Loren Israelsen: I would say by far the most significant was amending section 201, the definition section, which is food, drug, and now you have dietary supplement. We were told at the beginning, I recall John Dingell saying, "You will never get 201 status. That's a big deal." Where you see the definition of dietary ingredients, which is so abroad, is one of the key issue. If there is a DSHEA 2.0 we can imagine that the agency would like a relook at that broad definition. It was broad by intention because we knew we would not be able to define the full class of ingredients that consumers would use in some form of dietary supplement. That's number one by far. I think the second piece that was both critical but really complicated was figuring out the new dietary ingredient provision, that was complicated.
We were trying to think through what the future would look like. How would new ingredients come to market? What safety mechanisms? There was a lot of concern among the Democrats that scurrilous things might make it to market. Well, we've seen it, that has happened, and that's why the NDI provision was created. The hardest part within all of that was this chemical alteration problem of trying to figure out, when is something new, when has it been changed? We had a series of meetings trying to figure that out. I must say, on the back end, we've still struggled with trying to really understand the best way to define a new dietary ingredient. But we did the best we could with the time and the skills at hand. One might say that the bill's never been amended, which is remarkable, and it's proven to be extremely durable. It was a really well-crafted bill. People have taken shots at it, no one's been able to amend it or sink it.
John Troup: Yeah, that's awesome. I guess the other perspective of this description, Scott for you is, do you think even then that there were loopholes that you were concerned about that there would be workarounds that industry or unscrupulous players would try to move through? I mean, was that a concern back then or did it become a concern, if it is, today-
Scott Bass: [crosstalk 00:28:15]. The answer is yes, but, and the but is, for example, GMP, we didn't use the same language, but we knew we needed GMP even though a lot of industry were against that. But a number of us knew that unless we promise quality to the public, that the category could never really survive. John, I think to me the bill took off the table the theory FDA was using for 14 years, which is they said, if you put vitamin E in a vitamin E capsule you're adding it to the capsule and therefore it's an unapproved or unsafe food additive, which gave companies no defense. That was eliminated from the law, and that was good. But the problem was that we didn't know, to Loren's point, John, how companies would comply because there was such distrust on the part of industry and Congress in the way that FDA had enforced.
Two courts in 1991 and '92 called FDA's theory an Alice in Wonderland theory, meaning it was just a joke. The way they kept good products even in primrose oil and black currant oil off the market was saying, "Our experts don't recognize it generally recognized as safe." What happened, John is, to the chagrin, I think, of the three of us here and you, people have distorted the new dietary ingredient process and now there are industry members and lawyers who are end-running it by using what they call self GRAS, which was not available for anything other than proving a substance was used as a food. They're now using it to bypass the NDI process.
We have huge numbers of products that are unknown in terms of safety going on the market. And you have the dual problem of FDA not having enough money to enforce and therefore not having the capacity to stop this, and the problem of industry and some consultants and lawyers helping them to push a very untenable position that's not going to protect consumers. If we go from four billion to 40 billion, that brings the responsibility along with it to protect the safety of consumers. If we're one of the fastest growing consumer health categories in the world, we have an obligation that increases with its proliferation to provide safety. That's the biggest loophole that I've seen other than mandatory registration.
Patricia Knight: There's another complication hanging over that which is, the structure of the bill, which was suggested by Waxman, is basically that there are old ingredients, grandfather ingredients, that were on the market in the US the month of enactment of the bill. Then there would be new products which would go through this NDI process. It was very important to Senator Harkin and Senator Hatch that this NDI process not be pre-approval, but that we allow FDA the time to have a look, see, and make sure that they're comfortable with the safety data about a product. I think you were going to ask, was there something we wished we could have changed? One of my regrets is that we didn't have time to be able to elaborate on how you would prove old and how you would prove new.
We have products now that people are not using the NDI process for that are undoubtedly new, but they're not using it. Then you have this additional thing, complication, Scott mentioned of companies and councils using the GRAS self-affirmation. I won't call it a pathway because I don't think it really is a pathway, but they're doing that. Which is then allowing things to be on the market that maybe wouldn't be on the market if they went through an NDI. There's just a lot of confusion about, is it old or is it new? We really don't have a good system for telling that.
John Troup: Well, it's clear that the three of you did so much to establish a regulatory framework for the category that helped facilitate the growth of the industry. Over the last 26 years, Scott to your point, it's incredible what basically you guys enabled an industry to expand and to become really a credible source of products to help manage health. But along the way there were some bumps. Even from the start, the FDA, you couldn't really call them supportive of DSHEA. In 1996, I recall, what would you call them, Loren, the Ephedra Wars?
Loren Israelsen: Yeah.
John Troup: That didn't help industry much, but tell us a little bit about that time. Four years after the bill roughly was introduced, the industry was following it. Things started to get a little rough back then. Did that change the trajectory of DSHEA and of the dietary supplement industry, or it was quickly solved and industry moved on?
Loren Israelsen: Yeah. The passage of DSHEA came as such a shock to so many, ourselves included. We know just how close and how improbable the passage of the bill actually was that Trish described. The morning after, as the story goes, David Kessler opened his Washington Post and read that this dietary supplement law had passed and fell off his chair. It shocked a whole lot of people. What it did is, number one, it validated a deeply held belief in millions of Americans that they have a fundamental right to access to natural health products. That goes deeply into American history. There was a massive, I would say, emotional parade that was felt across the industry. We finally had a Green Card, and because it was statutory people couldn't take it away from us.
The second thing is that it woke up Wall Street that took now a great interest in this industry and money began to flow in. Generations of companies that have been family-owned began to sell. There was an awful lot of money being offered. That changed the character of the industry over time, going from private, to public, to venture capital. That has had a profound effect on the industry. 1994 is when Google was formed as an entity, Amazon wasn't far behind. DSHEA passed essentially the day the internet began and that transition was profound and we see even more so today. We became a very international industry. Most of our raw materials are sourced overseas. Our supply chains are very long and very complex. DSHEA, I think, has been stretched in terms of how it operates in a very different world now, vastly different than we imagined.
All the key documents, the drafts, the amendments that we're passing back and forth were done by fax. To me, that's an astonishment that we were able to do the volume of work necessary using faxes and conference calls and trying to keep it all straight. The other thought comes to mind is that, as much as we refer to the opposition from FDA and from other interests, there was tremendous disagreement inside the industry how this ought to go. There was a nutrient faction that was ready to sign a bill if herbs got tossed off the bus. A bill could have been done fairly easily, but the whole point of DSHEA was to protect those class of ingredients that had no protection.
That's what the internal battle came down to. As we saw the industry evolve, guess where all the growth came from. It was botanicals, amino acids, fish oil, probiotics, all of these other categories outside the traditional nutrients. As we look at what it was we tried to protect in DSHEA, it was that part of the industry that has been most fruitful that has grown the most over time.
Patricia Knight: Loren's touching on a key point there. When Scott talked about that little room, Hatch had a conference room way on the other side of the Hart building. It was just an empty room and we called it Norway, and we called it Norway because so many of the players in the industry were at each other's throats disagreeing about how different aspects of the bill should be handled. I think we have to recognize a key element of success in enactment of the law was that Harkin and Hatch were invested and they would tell the industry, "No, I don't think we can get that provision. If you insist on that, that's fine. But this bill is probably over, or this provision has to be in there. We need something to assure people that there will be safety of these products." Their tremendous personal interest really helped bring people together.
Loren Israelsen: It was very much, the Health Freedom Movement, Senators Hatch and Harkin, as Trish said, they insisted that it would be freedom with responsibility. That's ultimately what we tried to build into the bill was that compromise. Then there was a freedom faction that really didn't want to see any of that. They wanted a far broader right, and we felt that there would be abuses just by human nature. Trish and Scott and I were always in the camp of, we need to find safeguards to protect consumers. Ultimately that proved to be true. You mentioned Ephedra that became such a problem for the industry and to this day we'll still have people comment on Ephedra as a dark spot on DSHEA and the reason it ought to be amended.
Patricia Knight: Many of the points we just touched on are being carried out today with the CBD issue. Where FDA is insistent that they need to have us prove to them that there will be safety of these products, many of which they're allowing to remain on the market. There's a little public health conundrum going on there. But the issue of the self-affirmed GRAS, is it a new dietary ingredient or an old dietary ingredient? All of that is playing out as part of the CBD legislation that's currently on the Hill.
John Troup: Well, so here we are 26 years later plus or so, and there are still factions both in healthcare. There's the FDA is still paramount all about safety. You got the consumer who are much more engaged in dietary supplements today. The industry finds itself talking about modernization. The FDA is talking about modernization of DSHEA. What are you guys seeing? I mean, you were there from the beginning, you know the spirit of the law, you know the detail of the law, you know what's happened over 26 years in both industry and consumer behaviors and attitudes. What do you think? Is there an opportunity and a need for modernization? If you do think that's the case, what part of it should the focus be on? If you don't think so, why not? Loren, I guess I'll start with you.
Loren Israelsen: Well, I'll defer to Scott because he has strong views on this. I think Scott, you ought to lead that and we'll follow.
Scott Bass: For today's talk I try to think back, what are the fundamental assumptions we have now that weren't true then? Number one, we now know that these products work because people wouldn't buy $40 billion of them otherwise. As Loren said, has gone global. Number two, we know that the industry has refused to come up to its obligation on safety, so something has to be done to force that. Number three, there's been a major cultural shift in supply. When we passed DSHEA, meaning Trish and the staff, almost all the raw materials came from either Utah or Germany and Switzerland. Now they're all from Asia. I commend to everybody, if you haven't read the book, Bottle of Lies by Katherine Eban if you want to know what the mindset is in Asia that drives the concern about raw materials. Finally, there was no internet, as Loren mentioned, 1994, and that also drives the way things are sold.
I think in fixing it, the first thing we need is a mandatory registration. We need to give FDA a list of what's on the market. Right now they're shooting blind in a million directions because they don't know what's out there and what they should focus their enforcement efforts on. Number two, they need more money to enforce. We've heard a lot, even within FDA, that we found very credible and willing to work with the associations. They don't have the money or the personnel to go after a lot of violators. That goes from everything to tainted products, supply problems, and also companies that are riding on the coattails. The companies that are investing innovation and safety are not being rewarded because they have bad players coming in, not following NDIs, and FDA says they can't enforce so it's a problem.
Then I think the last part, and I'll shut, up is FDA has a residual interpretation that goes back to 2004 that's really holding back progress on the regulatory front, and it's creating more mistrust. That is in section 201, the definition of other substances. To Loren's earlier discussion and Trish's, we very purposely drafted it so we don't know what's going to come out. As long as it meets the safety standards, FDA should permit it. There'll be an NDI. Well, that's not happening because FDA is saying, if it's not nutritional, it's not another substance. That's the opposite of the way Congress actually took out the word nutritional there, and we need that fixed.
Loren Israelsen: John, I'll follow on a couple of things that 26 years later. Intellectual property protection is something that is a commercial problem. A lot of companies are willing to invest resources to do research. They have to be able to protect it in some fashion. It's difficult for natural products. Mandatory listing is probably the one issue that is most prominent in that DSHEA 2.0 discussion. Our view is that, okay, let's see the specific language and then we can come to terms. The reality is that most everybody has a website, most everybody has a public presence. Most of what FDA would like to see is already in the public domain. What the agency says is we need a more convenient way to know who's in the market. If it's true that there are 75,000 products, we'd just like to know what they are.
I think the third piece is structure function claims. You can hear a lot of interest in expansion of structure function claims to allow more communication of truthful information that goes beyond just structure and function. 26 years of research, 26 years of expanded knowledge, as well as a changed consumer that is vastly more informed, that has far greater access to information themselves, in some respects it's... we kid ourselves to believe that the consumer can't find whatever they want in five minutes online. In that case, we ought, as an industry, be able to try and communicate what we believe is the most, I would say, valid and truthful information we can in a world where there's a sea of knowledge that's sloshing everywhere. I think there's an imbalance that we need to really look at in that respect. I say all that with great concern is that if we open up DSHEA that mischief could be done, and that we have for decades felt that it was not worth the risk to do so.
Patricia Knight: I think just [crosstalk 00:46:17]-
Loren Israelsen: [inaudible 00:46:17].
Patricia Knight: Just to add to that a little-
John Troup: Trisha, I mean, before [inaudible 00:46:17]. Yeah, go ahead, go ahead.
Patricia Knight: Just to add to that a little bit, we don't know who the next FDA commissioner is going to be. We don't know what the Biden administration will say about supplements when they get to that part of their agenda. I think we have to be really careful about what might be referred to as opening up the act in a broad way because we could end up with some things that we really don't want. Certainly, mandatory listing is very close to ripe. The industry has discussed it a lot. Many of the companies do it already overseas. There's a rumor FDA has a bill written of their own, which may or may not be the same bill it would be under a Biden administration. There may be a basis there for moving something. I just know that there've been a lot of issues with specific supplements lately and we struggle with a way to portray them as not characterizing our whole industry because it's easy to get publicity about bad news, but not so much about good news. I mean, we have to be very careful as we move forward. We don't have a Harkin or a Hatch in a position to help us now.
John Troup: Yeah. In the alternative of a modernized bill, is there another way to address the issues that Scott had talked about and you to a certain extent, Loren? Can the industry do something itself, I hate to use this word, but self-policing more? Is there an alternative, and if not does that take us back to the need to try to introduce a bill without losing too much? Do we have a choice I guess is my question.
Loren Israelsen: Some of these things would need to be done statutorily to really make them work. For FDA to do it by administrative action is slow, complex. Ultimately it probably doesn't achieve the level of force that is needed on some of these specific issues. The real problem we face is that the industry has become two industries. One that has really adopted the fundamental premise of safety science quality and do beautiful work. They really, really try hard. There is another part of the industry that has become exploitive, and by and large operate on the internet, and they're incredibly difficult to find and stop. That's the part of the problem that you'll never resolve no matter legislative or administrative action, is that they come and go with one view is to make money quickly and then exit and move on, do harm to us in the meantime. Our biggest problem is how we deal with that faction of people. I don't regard them as being in the dietary supplement industry. I just regard them as passing through town and shooting the place up before they rob a bank and go.
Patricia Knight: To his credit, the industry, by and large the trade associations, have been advocating for more resources for FDA partially to do just that, to police the industry. Because it gives us all a bad name when people distort the law in the name of dietary supplements. I mean, if you watch late night TV, you see these ads for things and you're like, "They're calling it a supplement, oh my gosh, what do we do?"
Scott Bass: Well, [inaudible 00:49:56]. Before we wind up I just want to-
John Troup: Scott, any other thoughts-
Scott Bass: [crosstalk 00:49:59] CHPA for convening this podcast-
John Troup: On the choices that we have.
Scott Bass: Second to Trish and Loren for bringing back so many insights that are so critical. It's nice to know that the two of them are so active and are important voices now, because I think that I have a lot of hope that the right thing will happen. To Loren's point, it can't all be industry self-policing. When the language is proposed and people can look at it, the fact is Trish was saying that you have to look at overall how the industry has done, and it's pretty good. I think at this point my fingers are crossed that by next year at this time we'll have the bill, and we'll have a bill and we’ll have some agreement among the associations moving forward.
John Troup: Well, I have to say thanks so much for the time and the insights that you share. I think that our fantastic industry owes the three of you a great debt of gratitude for the work that you did and continue to do in this category. I know the difference that you've made in so many different companies and actually so many individual careers who've made a career out of the dietary supplement category, including myself. I want to thank you guys. To see and to have a better understanding of the insights on the underbelly of getting legislation through that Trish and all three of you guys worked together to make happen. I'm hopeful that something like that can still happen in today's government and bring that about.
But I got to ask you guys one last question, especially in 1994, what you guys achieved back then was a monumental task. What did you do to celebrate? Were you shocked at it or did you go out someplace and do it? I've gone to a lot of conferences in the last 26 years and had a chance to hear, I mean, all of you talk individually. But I never heard two things. I never heard the full story that we had here today, and I never heard you talk about the celebration part. There's got to be a story in there someplace.
Loren Israelsen: Yeah.
Patricia Knight: Scott, and Loren, and I celebrated it last year pre-COVID, had a very nice meal.
Loren Israelsen: We did. We had [crosstalk 00:52:30]-
John Troup: 25 years later? It took you guys 25 years later to realize you should celebrate?
Loren Israelsen: Yeah, delay. It was, we really had a great moment. Peter Reinecke was Senator Harkin's health policy staffer. Without Peter I don't think DSHEA would have passed. The four of us got together and it was a very special moment. The fact that we were all still involved in the industry and all still here on the planet is not unremarkable. I remember what happened is that we were sitting in the Senate, the health staff lounge watching the TV as the bills were being read through. It was ticking past 11:00 PM and our bill was not coming up. There's a whole other story of what happened. Senator Metzenbaum put a hold on it and there was a bit of a skirmish on the floor to break the hold.
But ultimately the bill was passed, I believe it was 11:24 PM. This is after days and days and days of intense negotiations. I was staying at the Hyatt Hotel just off Capitol Hill. I remember just shaking hands with the folks in the room and said, "Well done." We were just too tired to do anything more than that. I got back to my room. There was a little fridge with a mini bar. I got out a little half bottle of Spanish champagne and sat on the bed and thought, "Who do I call at this time of night?" I called one friend on the Pacific Coast just to say, "You won't believe what just happened," and then I just fell back and fell asleep on the bed.
Patricia Knight: In a certain sense it was kind of anticlimactic because we thought it was dead until that call from Richardson's staff who said that Waxman was going to offer us a draft. In my world it was still the end of the session so I had to keep working and we'd been up all night. But I don't recall that we ever, until literally last year, did go out and celebrate. Did we? I don't remember that.
Loren Israelsen: No, I think we just went back to work. We had just worked so hard and when it happened it was hard to explain, because there were so many moments that we thought this was done, it was dead. I think emotionally I was afraid to have too much hope that it really was going to pass for fear of being so disappointed one more time.
John Troup: Well, it's an awesome story. What a great experience. It's nice to learn the full story now and thanks really so much for the time and sharing it with our listeners. I hope for those of you listening that when you see Patricia Knight, Loren Israelsen, or Scott Bass, you at least buy them a drink and say thank you. Thank you to you all.
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