Regulatory Risks of Marketing Drugs and Cosmetics

Abstract

There are both governmental and private regulatory risks associated with marketing over-the-counter drugs and cosmetics. In the current “deregulation” era, there is much uncertainty in industry over the extent of acceptable claims. The Food and Drug Administration generally regulates the labeling of such products, focusing especially on safety or health-related risks. That agency generally tries to use its more potent drug regulating process when it objects to the marketing of particular products. The Federal Trade Commission regulates advertising, requiring substantiation of specific claims. Current FTC philosophy seeks to protect the reasonable consumer. Neither agency has been particularly active in regulating these products in the past few years. Other regulatory risks have arisen, including the risk of state consumer agency actions, private review by the National Advertising Division of the council of Better Business Bureaus and the National Advertising Review Board, review by broadcast networks, and private actions by competitors under the Lanham Trademark Act or state statutes for false advertising. In all cases, the responsibility lies with the manufacturer to substantiate all claims appropriately.