Upcoming Issue Highlights
Natural Products EXPO EAST
SOHO Expo

The Natural Products Industry—A Look Back and View Forward

| March 1, 2022

Natural products industry

Panelists:

Ramona Billingslea, Marketing Manager, Betsy’s Health Foods, Spring, TX, www.betsyhealth.com

Cal Bewicke, CEO, Ethical Naturals Inc., Novato, CA, www.ethicalnaturals.com

Jonathan W. Emord, President and Principal, Emord & Associates, Clifton, VA, www.emord.com

Dan Fabricant, Ph.D., President & CEO, Natural Products Association, Washington, D.C., www.npanational.org

Abhishek Gurnani, Partner (Chicago Office), Abhishek Gurnani, Amin Talati Wasserman LLP, www.amintalati.com

Karen Howard, CEO, Executive Director, Organic & Natural Health Association, www.organicandnatural.org

Wilson Lau, Vice President, Nuherbs, San Leandro, CA, www.nuherbs.com

Mark A. LeDoux, Chairman and CEO, Natural Alternatives International, Carlsbad, CA, www.nai-online.com

Dan Lifton, CEO, Quality of Life Labs, Port Chester, NY, www.qualityoflife.net

Steve Mister, President & CEO, CRN, Washington, D.C., www.crnusa.org

Diana Morgan, Head of Scientific & Regulatory Affairs, Care/of, New York, NY, www.takecareof.com

Dan Richard, Vice President Sales, NOW Foods, Bloomingdale, IL, www.nowfoods.com

Marge Roman, Manager, Stay Healthy!, Las Vegas NV, www.stayhealthylasvegas.com

Jim Roza, Chief Scientific Officer, Layn Natural Ingredients, Irvine, CA, www.layncorp.com

Elan Sudberg, CEO, Alkemist Labs, Garden Grove, CA, www.alkemist.com

The retail marketplace has recently withstood a stress test of unprecedented proportions and adapted to changes in how it does things and what it sells.

On the front lines, retailers have experienced surges in consumer demand and frustrating manufacturer out-of-stocks.

At the same time, behind all of this is a backdrop of labor-market shortages, the challenge of government-ordered employer vaccine mandates and what some see as a less-than-friendly regulatory landscape.

Regarding NAC—perhaps a bellwether of where the FDA (U.S. Food and Drug Administration) could be headed—to many it strains credulity that the FDA’s current interpretation can hold up under the weight of both pre-1994 sales data and lawsuits articulately challenging its current posture regarding this valuable ingredient.

Yet, it remains to be seen.

Here to help us glance back and peer forward is a panel of dietary supplement industry experts.

VR: What is the one top issue facing the dietary supplement industry right now, and why?

Billingslea: From a small retailer’s perspective, the top issue would be the survival of mom-and-pop stores like ours, which specialize in helping customers one-on-one and offer on-the-spot product knowledge.

As these small stores cease to exist, manufacturers lose their primary champions in the marketplace. We likewise have to choose our manufacturing partners wisely so that the prices we are able to offer in the store match what the products are being sold for online.

The worst issue for us is putting our trust in the wrong partner’s hands and being undersold elsewhere. This issue is why we concentrate so much of our efforts on private label.

Richard: COVID-19 has dramatically affected our industry in two ways. The obvious one is in higher demand for natural products to support healthy immune systems. Our industry saw very high growth especially in 2020, and this continues for products such as vitamin C, zinc, elderberry, quercetin, NAC and many more. The increase in overall demand has caused the second key issue: supply chain. Products such as quercetin, creatine, whey and many other supplements, personal care ingredients and organic foods have jumped in cost due to Covid-related inflation.

Morgan: Two words: supply chain. It’s no surprise that all industries have been hit hard with supply chain shortages. In an industry that relies on international ingredients, these increased timelines and prices have caused mass disruptions for brands and retailers.

Fabricant: We are especially concerned about the FDA’s failure to act against adulterated products that violate the New Dietary Ingredient (NDI) notification process and reluctance to set a safe level of daily consumption for CBD.

On the other end of the enforcement spectrum, the FDA has overreached regarding NAC, setting a dangerous precedent that could extend to other products. NPA has pushed back on this forcefully, filing a lawsuit against the FDA to stop its retroactive—and misguided—application of DSHEA (Dietary Supplement Health and Education Act of 1994).

Bewicke: Product quality assurance is still the top issue facing the industry, and this concern has only increased under current conditions.

For example, supply chain problems have interrupted reliable sources of raw materials, leaving many companies to buy from whatever sources they can find. Often they don’t have the time to validate these suppliers, or the resources to do cGMP (current good manufacturing practice) level testing on these new ingredients; this level of testing is time consuming and expensive.

The hundreds of brands that now seek to profit from the booming Amazon and e-commerce markets magnifies this problem. Here, speed and price are the driving forces, not the time and money required for accurate quality assurance. The end result is that consumers may be getting sub-par products that don’t provide the benefits they expect, which is not good for anyone.

Emord: The top issue is supply chain disruption aggravated by work force staffing issues due to the pandemic. Federal government expansion of benefits for unemployed workers, the child tax credit and COVID-19 mandates have resulted in disruption of work all along the supply chain. That, together with COVID-19 sick leave and government mandated closures have made it difficult for dietary supplement companies to fill orders in a timely manner and obtain needed ingredients.

Lifton: Making sure that retailers are able to order the products they want for their customers. In that regard, Quality of Life (QOL) has been working non-stop with Maypro and other partners to strengthen our inventories and supply-chain agreements.

Howard: Imagine being prohibited from promoting immune health through supplementation. In a world where drugs are the only solution for any condition, NAC will stand as the first industry sacrifice. FDA’s overreach when it comes to the once obscure “drug preclusion” in DSHEA, clearly driven by economic interests and not safety, has enormous implications for the industry’s future.

Sudberg: Supply chain disruption is the top issue at the current time for the dietary supplement industry. By proxy, this issue has only increased the severity of prior top issues like adulteration. Our clients simply cannot keep up with demand from consumers and nor can their suppliers, so the frightening and laborious challenge of vetting new suppliers is plaguing the industry. My solution to this, as it is to so many product vulnerabilities is to test, test, and test some more.

VR: What temporary or permanent changes has your organization made in response to the crisis?

Lifton: We’ve encouraged those staff members who are able to work remotely to take advantage of this new work-from-home opportunity. The social stigma has been removed from the concept of remote work and it is now just part of the work-life mix for many workers, including QOL staff. In so doing, we’ve made sure that our customer service and sales support functions are fully staffed and fully equipped to serve our retail and end-user customers.

Morgan: In the natural products industry, it’s really important to keep health top of mind all the time. That really should be the philosophy of all brands. Dietary supplements support health and cannot treat or cure any disease or condition. We’ve always communicated that our products support everyday health and that is what we’ve continued to do during the past two years.

Richard: NOW has made very significant changes with the biggest being a major investment in a new manufacturing building in Illionis. We purchased a building next door to our main plant about three years ago and had this in the works, but we upped our plans and have been preparing this new facility for our highest speed equipment yet. We plan to start production in Spring 2022 after spending 18 months with building upgrades.

NOW also changed a lot with how we hire. NOW actually hired over 600 new employees in 2021 alone, by far a big record. Unfortunately, we are having higher than normal turnover, yet we’ve still added over 200 additional new workers. Our aim for 2022 is to continue hiring at least 200 more new positions.

VR: Have these disruptions caused changes in formulations or shipment policies?

Fabricant: In a recent NPA survey, our members reported significant delays in receiving orders, price increases, and an inability to get products. Plastic products including bottle caps, bottles, packaging supplies, and raw and finished products are among items businesses are having difficulty obtaining. To reduce the strain, businesses reported rationing products, looking for alternatives, opening new lines of credit, purchasing items they do not usually carry to fill store shelves and purchasing items in advance.

Lifton: I think all manufacturers are experiencing some ingredient short-falls due to global shortages—which are beyond any company’s control—but these will either be temporary or, if not, are easily replaceable by other compatible science-validated alternative ingredients.

Bewicke: Supply chain disruptions on almost all components for supplement manufacturing continue. At Ethical Naturals, from the very beginning of COVID, we began to build substantial extra inventory in all of our ingredients, and to work closely with suppliers and customers to make sure we could meet demands. This has enabled us to maintain consistent on-time shipping policies, and manufacture products without formula changes.

Richard: NOW has not made formulation changes or shipping changes, but we have had supply problems. NOW has not had any Eyebright herb for over 12 months and it looks like we will have no supplies of creatine for many months as well due to very high costs. Other products, such as quercetin, have increased in cost so much that we have to stop buying, even though this is a very big seller. Also, many low-cost items like psyllium from India, have jumped in cost almost entirely due to significantly higher container costs from Asia.

VR: Has the pandemic brought the industry together again? Thoughts?

Morgan: One aspect I love about this industry is that we are a tight-knit community. But the first in-person event when old colleagues got to see each other again proved that. They say absence makes the heart grow fonder, and I believe that is true!

Lifton: Based on the popularity of WhatsUpWithSupps and other in-person networking events, I think it’s clear that work relationships, camaraderie and in-person business cannot be stifled. Plus, the energy and enthusiasm we’ve seen with the resumption of in-person trade shows is wonderful to be part of.

Lau: I definitely think these shared challenges have created closer bonds. When there is a common goal, it pulls people together. There are a lot of calls and emails to our friends in the industry to troubleshoot issues that were new due to the pandemic. So, in a way, it did pull us closer despite us not being to be physically together at industry events.

Emord: I sense considerable unity against heavy handed government impositions on our clients’ methods of doing business. All of them have successfully weathered the pandemic so far and rightfully believe they know better than governors and presidents how best to protect and care for their employees and customers. They work in an industry that has spent decades studying nutritional effects on immune function and maximizing overall health. They have a better understanding than the typical politician about the nature of the virus and how best to overcome it.

VR: On Dec. 17, the 6th U.S. Circuit Court of Appeals lifted the stay on the federal government’s rule requiring covered employers to ensure workers are vaccinated against the coronavirus or undergo weekly COVID-19 testing. Now potentially on to the Supreme Court. Your thoughts?

Emord: The OSHA mandate and the CMS mandate violate the OSHA and CMS enabling statutes and the United States Constitution. Even were there a federal police power that embraced national vaccination, it would still be incumbent on the President to seek the passage of legislation to alter fundamentally the lives of tens of millions of employees.

I believe the Fifth Circuit got it right on this, and I would hope the Supreme Court would reverse the Sixth Circuit’s 2-1 decision lifting the stay.

If by executive branch fiat, the President can declare a health emergency and impose restrictions on the workplace for a ubiquitous virus, there is nothing preventing him from doing likewise in response to, say, the obesity epidemic. Under this extraconstitutional power, the President could compel dietary strictures on employees to prevent heart attacks.

The OSHA emergency temporary standard was meant to be an extraordinary measure to stop a hazard originating in the workplace for which inadequate time existed for a rule making to be completed. It is being used to combat a ubiquitous virus, which even if it could be ordered out of the workplace (it cannot; the vaccinated can carry the virus; and the virus is everywhere else a worker goes), it greets people in all other venues open to them. It is grossly ill fitting and incapable of altering the trajectory of the virus one iota.

Sudberg: Born to scientists, I practically grew up in labs and hold a degree in chemistry. I feel confident that I understand virology and vaccine effectiveness much better than most of the general public. Regardless of Merriam-Webster Dictionary’s recent (July 2021) change of the definition of antivaxxers to include someone opposed to vaccine mandates, (not the Oxford English Dictionary which has kept the original definition), I am not anti-vaxxer, but I am opposed to vaccine mandates. As an employer, I will do everything in my power to support others opposed to workplace vaccine mandates and protect my employees’ rights to choose what goes in their bodies. This included their choice to be vaccinated as well.

Body sovereignty should be on the endangered species list and I worry that mandates are a slippery slope to dictate highly personal decisions without public input or individual choice. And in this case, without adequate safety data, or consideration of other options including critical nutrients and botanicals or other early treatments. Somehow, we ended up with a false dichotomy policy, vaccines or nothing and if you do not like that the government will decide for you.

LeDoux: Personally, mandating vaccination or ongoing testing at this late date, in the face of continued labor shortages is a very short-sighted approach to managing this epidemic which has a 97 percent plus survival rate. This is especially true given the emergence of the far less lethal Omicron variant of this coronavirus (albeit highly transmissible), and the introduction of oral medicines and monoclonal antibody treatments that have demonstrated significant efficacy in combatting this disease.

Fabricant: We have asked the courts to block the Biden Administration’s vaccine and testing mandate based on concerns from our members about how it will impact their ability meet demand for natural products that millions of Americans rely on. This rule also imposes high costs on our members already burdened by supply chain problems and labor shortages. We believe that the rule is unconstitutional and are hopeful that the Supreme Court sees it that way too. No matter where anyone sits on the issue of vaccines, we already manage and control colds and the flu as required by FDA cGMPs in a manufacturing environment, it’s unclear as to what benefits, if any, added OSHA requirements would make the workplace safer. Additionally, COVID isn’t a workplace issue; unfortunately, it can be contracted anywhere, not just in the workplace.

VR: What is your prediction as to where the FDA will land regarding petitions and challenges to its position on N-acetyl-L-cysteine (NAC) in dietary supplements, and will NAC come out “alive”?

Mister: CRN is confident that NAC will be recognized as a lawful dietary ingredient. For the reasons laid out in our submissions to FDA, we believe the agency will ultimately recognize that the drug preclusion provision cannot be applied retroactively to ingredients that were already on the market prior to 1994.

Richard: We certainly hope that truth wins. NOW first sold NAC in 1993, which is pre-DSHEA and an important criteria for keeping NAC as a dietary supplement. NOW has been working primarily with NPA to represent our industry and we are planning to continue fighting to keep NAC legal as a dietary supplement. It’s interesting that as recently as July 2021 NOW was granted Free Sale certificates by FDA to legally export NAC to some countries, but this stopped later in the year. This is the kind of action that FDA can take that most people would not know.

LeDoux: As Chairman of the Board of the Natural Products Association (NPA), I authorized the organization to file suit against the FDA for clarification of this matter. It seems a gross overreach by the regulatory agency given the safe history of use of NAC (n-acetyl l-Cysteine) prior to the passage of DSHEA, therefore rendering NAC as essentially exempt from this position postulated by the Food and Drug Administration. We remain hopeful that the courts will provide clarity in this matter and indeed NAC as a dietary supplement will remain available for consumer procurement and use.

Gurnani: The recent lawsuit filed by NPA has made this issue a bit more interesting as it forces FDA’s hand. The industry is arguing that DSHEA’s drug exclusion language does not apply retroactively to ingredients, such as NAC, that were marketed in dietary supplements prior to Oct. 15, 1994. This is important as FDA could take this approach on a number of other ingredients that have long been used in supplements but may be excluded based on the drug study or approval. We are optimistic that FDA will ultimately reverse course and allow NAC to be marketed in dietary supplements.

VR: There appears to be a new wave of natural brands being acquired by global corporations. What implications—if any—does this pose to the natural products industry?

Billingslea: I definitely see an increase of the trend of viewing products in total and not just as an individual bottle. Manufacturers need to emphasize their concern for the environment and commitment to helping rather than hurting the planet to appeal to the bulk of consumers, especially consumers who are interested in supplements. Our healthy living consumers also want a healthy planet.

Sudberg: If I didn’t say that natural brands being acquired by global corporations has got me a little worried I would be a liar.

They have new bosses who dictate the public narrative. I fear that this is why many of our wonderful organizations have yet to speak up on or even against the federal government’s rule requiring covered employers to ensure workers are vaccinated against the coronavirus.

This industry was called the alternative medicine industry at one point and was created by individuals passionate about plants, fungi and supplements, and the health benefits that their products could offer individuals seeking an alternative to modern drugs or big pharma.

I am concerned the freedom will decline in lieu of profits as global corporations continue to buy us up.

Richard: Perhaps this is inevitable due to the size of our industry and how difficult it is to pass ownership to next generations. But this dramatic change has many negatives to our industry, especially the “will” to fight unnecessary regulations.

Big Pharma does not have the same interests that independent natural food stores have, nor the required heart to do what is right vs. focus on quarterly profits. It’s sad that there are so few natural supplement brands still privately owned by the same family.

Roza: Smaller natural brands built this industry and were able to move faster in response to previously smaller and more niche demand. The fact that global brands are now making sweeping acquisitions is evidence of how mainstream plant-based, healthier eating and supplementation has become – and so, the natural products industry must move forward, continuing to pave the path for the next generation of natural products. We see this cycle, honor it, and innovate to be able to both supply at global scale, and innovate new, novel, efficacious ingredients.

Lau: The benefit of big CPG corps acquiring natural brands is that it increases their reach and distribution. So, it will no longer be something only accessible to some, but it becomes “mass” market. So, the benefit is more people get to enjoy the benefits of our products. The downside by selling and the founders losing controlling stake is that the heart and soul of the company is no longer founder-driven.

I think entrepreneurship has been fundamentally changed since I entered the workforce, 20 something years ago and probably was shifting even before that. In the past, entrepreneurs built companies that they intended to run and keep until they retired or close to it, and pass on to their families.

However, in “modern” entrepreneurship and capital formation, we are looking at the exit strategy, even before companies are launched, because the need to return capital to investors or desire for a big payday. How is that for a pivot?

Lifton: Provided the natural brands stay true to the vision, mission and values of their founders, there are not any real negatives here, only opportunities for good products to get in millions of more hands.

VR: What is the single-biggest contribution your company or organization made to advancing the natural products industry in 2021?

Fabricant: Our fight against FDA’s unlawful regulatory actions regarding NAC has the biggest ramifications. We believe our lawsuit puts FDA’s inconsistent actions under a microscope at a time when they are requesting new authorities like mandatory product listing. As someone who used to sit in the chair, I know I would have a hard time explaining why the agency is acting against a product that has been safely on the market for more than 30 years at a time when simple things like inspecting facilities aren’t being executed. As we await the outcome of our lawsuit, we will continue to review all options as it relates to ensuring FDA is accountable to consumers and to industry.

Richard: NOW continued testing less familiar supplement brands on Amazon and reporting this to Amazon, the trade, media, NPA and FDA. In 2021, NOW did testing on turmeric/curcumin and glutathione products on Amazon.

Testing included potency, heavy metals, radiocarbon testing for naturalness of curcumin, and testing on the vegetarian capsules to see if any products were mislabeled and actually used gelatin capsules. This follows NOW’s ongoing effort of testing products on Amazon and openly reporting the results.

It was gratifying for NOW to receive several industry awards recognizing our efforts to help clean up brands that cheat: NutraIngredients-USA 2021 Editors Award for Industry Initiative of the Year, and Nutritional Outlook’s Best of Industry: Leader award for this initiative, as well as NBJ’s “Efforts on Behalf of Industry” award in May 2021.

Sudberg: 2021 was a tremendous year for Alkemist Labs. We grew nearly 30 percent year over year, hired more employees and invested over $1 million in new equipment to continue to meet the needs of the industry. We’re about to begin offering additional testing services.

Several labs were gobbled up by the industry goliaths and in turn less choices are now available. Aside from being your reliable experts in plant and fungal analysis we have pioneered the concept of Next Generation Transparency. It’s a simple and nearly free concept that gives the admirable players in our industry a vehicle to showcase their quality with consumer-centric C of As.

If you are going above and beyond in the quality department, why not share proof? I started writing about this nearly seven years ago and 2021 was the year it was finally adopted by some of the best brands in the biz. Stay tuned for more on that in 2022. VR

Extra! Extra!

Panelists:

Ramona Billingslea, Marketing Manager, Betsy’s Health Foods, Spring, TX, www.betsyhealth.com

Cal Bewicke, CEO, Ethical Naturals Inc., Novato, CA, www.ethicalnaturals.com

Jonathan W. Emord, President and Principal, Emord & Associates, Clifton, VA, www.emord.com

Dan Fabricant, Ph.D., President & CEO, Natural Products Association, Washington, D.C., www.npanational.org

Abhishek Gurnani, Partner (Chicago Office), Abhishek Gurnani, Amin Talati Wasserman LLP, www.amintalati.com

Karen Howard, CEO, Executive Director, Organic & Natural Health Association, www.organicandnatural.org

Wilson Lau, Vice President, Nuherbs, San Leandro, CA, www.nuherbs.com

Mark A. LeDoux, Chairman and CEO, Natural Alternatives International, Carlsbad, CA, www.nai-online.com

Dan Lifton, CEO, Quality of Life Labs, Port Chester, NY, www.qualityoflife.net

Steve Mister, President & CEO, CRN, Washington, D.C., www.crnusa.org

Diana Morgan, Head of Scientific & Regulatory Affairs, Care/of, New York, NY, www.takecareof.com

Dan Richard, Vice President Sales, NOW Foods, Bloomingdale, IL, www.nowfoods.com

Marge Roman, Manager, Stay Healthy!, Las Vegas NV, www.stayhealthylasvegas.com

Jim Roza, Chief Scientific Officer, Layn Natural Ingredients, Irvine, CA, www.layncorp.com

Elan Sudberg, CEO, Alkemist Labs, Garden Grove, CA, www.alkemist.com

The retail marketplace has recently withstood a stress test of unprecedented proportions and adapted to changes in how it does things and what it sells.

On the front lines, retailers have experienced surges in consumer demand and frustrating manufacturer out-of-stocks.

At the same time, behind all of this is a backdrop of labor-market shortages, the challenge of government-ordered employer vaccine mandates and what some see as a less-than-friendly regulatory landscape.

Regarding NAC—perhaps a bellwether of where the FDA (U.S. Food and Drug Administration) could be headed—to many it strains credulity that the FDA’s current interpretation can hold up under the weight of both pre-1994 sales data and lawsuits articulately challenging its current posture regarding this valuable ingredient.

Yet, it remains to be seen.

Here to help us glance back and peer forward is a panel of dietary supplement industry experts.

VR: What is the one top issue facing the dietary supplement industry right now, and why?

Billingslea: From a small retailer’s perspective, the top issue would be the survival of mom-and-pop stores like ours, which specialize in helping customers one-on-one and offer on-the-spot product knowledge.

As these small stores cease to exist, manufacturers lose their primary champions in the marketplace. We likewise have to choose our manufacturing partners wisely so that the prices we are able to offer in the store match what the products are being sold for online.

The worst issue for us is putting our trust in the wrong partner’s hands and being undersold elsewhere. This issue is why we concentrate so much of our efforts on private label.

Richard: COVID-19 has dramatically affected our industry in two ways. The obvious one is in higher demand for natural products to support healthy immune systems. Our industry saw very high growth especially in 2020, and this continues for products such as vitamin C, zinc, elderberry, quercetin, NAC and many more. The increase in overall demand has caused the second key issue: supply chain. Products such as quercetin, creatine, whey and many other supplements, personal care ingredients and organic foods have jumped in cost due to Covid-related inflation.

Morgan: Two words: supply chain. It’s no surprise that all industries have been hit hard with supply chain shortages. In an industry that relies on international ingredients, these increased timelines and prices have caused mass disruptions for brands and retailers.

Fabricant: We are especially concerned about the FDA’s failure to act against adulterated products that violate the New Dietary Ingredient (NDI) notification process and reluctance to set a safe level of daily consumption for CBD.

On the other end of the enforcement spectrum, the FDA has overreached regarding NAC, setting a dangerous precedent that could extend to other products. NPA has pushed back on this forcefully, filing a lawsuit against the FDA to stop its retroactive—and misguided—application of DSHEA (Dietary Supplement Health and Education Act of 1994).

Bewicke: Product quality assurance is still the top issue facing the industry, and this concern has only increased under current conditions.

For example, supply chain problems have interrupted reliable sources of raw materials, leaving many companies to buy from whatever sources they can find. Often they don’t have the time to validate these suppliers, or the resources to do cGMP (current good manufacturing practice) level testing on these new ingredients; this level of testing is time consuming and expensive.

The hundreds of brands that now seek to profit from the booming Amazon and e-commerce markets magnifies this problem. Here, speed and price are the driving forces, not the time and money required for accurate quality assurance. The end result is that consumers may be getting sub-par products that don’t provide the benefits they expect, which is not good for anyone.

Emord: The top issue is supply chain disruption aggravated by work force staffing issues due to the pandemic. Federal government expansion of benefits for unemployed workers, the child tax credit and COVID-19 mandates have resulted in disruption of work all along the supply chain. That, together with COVID-19 sick leave and government mandated closures have made it difficult for dietary supplement companies to fill orders in a timely manner and obtain needed ingredients.

Lifton: Making sure that retailers are able to order the products they want for their customers. In that regard, Quality of Life (QOL) has been working non-stop with Maypro and other partners to strengthen our inventories and supply-chain agreements.

Howard: Imagine being prohibited from promoting immune health through supplementation. In a world where drugs are the only solution for any condition, NAC will stand as the first industry sacrifice. FDA’s overreach when it comes to the once obscure “drug preclusion” in DSHEA, clearly driven by economic interests and not safety, has enormous implications for the industry’s future.

Sudberg: Supply chain disruption is the top issue at the current time for the dietary supplement industry. By proxy, this issue has only increased the severity of prior top issues like adulteration. Our clients simply cannot keep up with demand from consumers and nor can their suppliers, so the frightening and laborious challenge of vetting new suppliers is plaguing the industry. My solution to this, as it is to so many product vulnerabilities is to test, test, and test some more.

VR: What temporary or permanent changes has your organization made in response to the crisis?

Lifton: We’ve encouraged those staff members who are able to work remotely to take advantage of this new work-from-home opportunity. The social stigma has been removed from the concept of remote work and it is now just part of the work-life mix for many workers, including QOL staff. In so doing, we’ve made sure that our customer service and sales support functions are fully staffed and fully equipped to serve our retail and end-user customers.

Morgan: In the natural products industry, it’s really important to keep health top of mind all the time. That really should be the philosophy of all brands. Dietary supplements support health and cannot treat or cure any disease or condition. We’ve always communicated that our products support everyday health and that is what we’ve continued to do during the past two years.

Richard: NOW has made very significant changes with the biggest being a major investment in a new manufacturing building in Illionis. We purchased a building next door to our main plant about three years ago and had this in the works, but we upped our plans and have been preparing this new facility for our highest speed equipment yet. We plan to start production in Spring 2022 after spending 18 months with building upgrades.

NOW also changed a lot with how we hire. NOW actually hired over 600 new employees in 2021 alone, by far a big record. Unfortunately, we are having higher than normal turnover, yet we’ve still added over 200 additional new workers. Our aim for 2022 is to continue hiring at least 200 more new positions.

VR: Have these disruptions caused changes in formulations or shipment policies?

Fabricant: In a recent NPA survey, our members reported significant delays in receiving orders, price increases, and an inability to get products. Plastic products including bottle caps, bottles, packaging supplies, and raw and finished products are among items businesses are having difficulty obtaining. To reduce the strain, businesses reported rationing products, looking for alternatives, opening new lines of credit, purchasing items they do not usually carry to fill store shelves and purchasing items in advance.

Lifton: I think all manufacturers are experiencing some ingredient short-falls due to global shortages—which are beyond any company’s control—but these will either be temporary or, if not, are easily replaceable by other compatible science-validated alternative ingredients.

Bewicke: Supply chain disruptions on almost all components for supplement manufacturing continue. At Ethical Naturals, from the very beginning of COVID, we began to build substantial extra inventory in all of our ingredients, and to work closely with suppliers and customers to make sure we could meet demands. This has enabled us to maintain consistent on-time shipping policies, and manufacture products without formula changes.

Richard: NOW has not made formulation changes or shipping changes, but we have had supply problems. NOW has not had any Eyebright herb for over 12 months and it looks like we will have no supplies of creatine for many months as well due to very high costs. Other products, such as quercetin, have increased in cost so much that we have to stop buying, even though this is a very big seller. Also, many low-cost items like psyllium from India, have jumped in cost almost entirely due to significantly higher container costs from Asia.

VR: Has the pandemic brought the industry together again? Thoughts?

Morgan: One aspect I love about this industry is that we are a tight-knit community. But the first in-person event when old colleagues got to see each other again proved that. They say absence makes the heart grow fonder, and I believe that is true!

Lifton: Based on the popularity of WhatsUpWithSupps and other in-person networking events, I think it’s clear that work relationships, camaraderie and in-person business cannot be stifled. Plus, the energy and enthusiasm we’ve seen with the resumption of in-person trade shows is wonderful to be part of.

Lau: I definitely think these shared challenges have created closer bonds. When there is a common goal, it pulls people together. There are a lot of calls and emails to our friends in the industry to troubleshoot issues that were new due to the pandemic. So, in a way, it did pull us closer despite us not being to be physically together at industry events.

Emord: I sense considerable unity against heavy handed government impositions on our clients’ methods of doing business. All of them have successfully weathered the pandemic so far and rightfully believe they know better than governors and presidents how best to protect and care for their employees and customers. They work in an industry that has spent decades studying nutritional effects on immune function and maximizing overall health. They have a better understanding than the typical politician about the nature of the virus and how best to overcome it.

VR: On Dec. 17, the 6th U.S. Circuit Court of Appeals lifted the stay on the federal government’s rule requiring covered employers to ensure workers are vaccinated against the coronavirus or undergo weekly COVID-19 testing. Now potentially on to the Supreme Court. Your thoughts?

Emord: The OSHA mandate and the CMS mandate violate the OSHA and CMS enabling statutes and the United States Constitution. Even were there a federal police power that embraced national vaccination, it would still be incumbent on the President to seek the passage of legislation to alter fundamentally the lives of tens of millions of employees.

I believe the Fifth Circuit got it right on this, and I would hope the Supreme Court would reverse the Sixth Circuit’s 2-1 decision lifting the stay.

If by executive branch fiat, the President can declare a health emergency and impose restrictions on the workplace for a ubiquitous virus, there is nothing preventing him from doing likewise in response to, say, the obesity epidemic. Under this extraconstitutional power, the President could compel dietary strictures on employees to prevent heart attacks.

The OSHA emergency temporary standard was meant to be an extraordinary measure to stop a hazard originating in the workplace for which inadequate time existed for a rule making to be completed. It is being used to combat a ubiquitous virus, which even if it could be ordered out of the workplace (it cannot; the vaccinated can carry the virus; and the virus is everywhere else a worker goes), it greets people in all other venues open to them. It is grossly ill fitting and incapable of altering the trajectory of the virus one iota.

Sudberg: Born to scientists, I practically grew up in labs and hold a degree in chemistry. I feel confident that I understand virology and vaccine effectiveness much better than most of the general public. Regardless of Merriam-Webster Dictionary’s recent (July 2021) change of the definition of antivaxxers to include someone opposed to vaccine mandates, (not the Oxford English Dictionary which has kept the original definition), I am not anti-vaxxer, but I am opposed to vaccine mandates. As an employer, I will do everything in my power to support others opposed to workplace vaccine mandates and protect my employees’ rights to choose what goes in their bodies. This included their choice to be vaccinated as well.

Body sovereignty should be on the endangered species list and I worry that mandates are a slippery slope to dictate highly personal decisions without public input or individual choice. And in this case, without adequate safety data, or consideration of other options including critical nutrients and botanicals or other early treatments. Somehow, we ended up with a false dichotomy policy, vaccines or nothing and if you do not like that the government will decide for you.

LeDoux: Personally, mandating vaccination or ongoing testing at this late date, in the face of continued labor shortages is a very short-sighted approach to managing this epidemic which has a 97 percent plus survival rate. This is especially true given the emergence of the far less lethal Omicron variant of this coronavirus (albeit highly transmissible), and the introduction of oral medicines and monoclonal antibody treatments that have demonstrated significant efficacy in combatting this disease.

Fabricant: We have asked the courts to block the Biden Administration’s vaccine and testing mandate based on concerns from our members about how it will impact their ability meet demand for natural products that millions of Americans rely on. This rule also imposes high costs on our members already burdened by supply chain problems and labor shortages. We believe that the rule is unconstitutional and are hopeful that the Supreme Court sees it that way too. No matter where anyone sits on the issue of vaccines, we already manage and control colds and the flu as required by FDA cGMPs in a manufacturing environment, it’s unclear as to what benefits, if any, added OSHA requirements would make the workplace safer. Additionally, COVID isn’t a workplace issue; unfortunately, it can be contracted anywhere, not just in the workplace.

VR: What is your prediction as to where the FDA will land regarding petitions and challenges to its position on N-acetyl-L-cysteine (NAC) in dietary supplements, and will NAC come out “alive”?

Mister: CRN is confident that NAC will be recognized as a lawful dietary ingredient. For the reasons laid out in our submissions to FDA, we believe the agency will ultimately recognize that the drug preclusion provision cannot be applied retroactively to ingredients that were already on the market prior to 1994.

Richard: We certainly hope that truth wins. NOW first sold NAC in 1993, which is pre-DSHEA and an important criteria for keeping NAC as a dietary supplement. NOW has been working primarily with NPA to represent our industry and we are planning to continue fighting to keep NAC legal as a dietary supplement. It’s interesting that as recently as July 2021 NOW was granted Free Sale certificates by FDA to legally export NAC to some countries, but this stopped later in the year. This is the kind of action that FDA can take that most people would not know.

LeDoux: As Chairman of the Board of the Natural Products Association (NPA), I authorized the organization to file suit against the FDA for clarification of this matter. It seems a gross overreach by the regulatory agency given the safe history of use of NAC (n-acetyl l-Cysteine) prior to the passage of DSHEA, therefore rendering NAC as essentially exempt from this position postulated by the Food and Drug Administration. We remain hopeful that the courts will provide clarity in this matter and indeed NAC as a dietary supplement will remain available for consumer procurement and use.

Gurnani: The recent lawsuit filed by NPA has made this issue a bit more interesting as it forces FDA’s hand. The industry is arguing that DSHEA’s drug exclusion language does not apply retroactively to ingredients, such as NAC, that were marketed in dietary supplements prior to Oct. 15, 1994. This is important as FDA could take this approach on a number of other ingredients that have long been used in supplements but may be excluded based on the drug study or approval. We are optimistic that FDA will ultimately reverse course and allow NAC to be marketed in dietary supplements.

VR: There appears to be a new wave of natural brands being acquired by global corporations. What implications—if any—does this pose to the natural products industry?

Billingslea: I definitely see an increase of the trend of viewing products in total and not just as an individual bottle. Manufacturers need to emphasize their concern for the environment and commitment to helping rather than hurting the planet to appeal to the bulk of consumers, especially consumers who are interested in supplements. Our healthy living consumers also want a healthy planet.

Sudberg: If I didn’t say that natural brands being acquired by global corporations has got me a little worried I would be a liar.

They have new bosses who dictate the public narrative. I fear that this is why many of our wonderful organizations have yet to speak up on or even against the federal government’s rule requiring covered employers to ensure workers are vaccinated against the coronavirus.

This industry was called the alternative medicine industry at one point and was created by individuals passionate about plants, fungi and supplements, and the health benefits that their products could offer individuals seeking an alternative to modern drugs or big pharma.

I am concerned the freedom will decline in lieu of profits as global corporations continue to buy us up.

Richard: Perhaps this is inevitable due to the size of our industry and how difficult it is to pass ownership to next generations. But this dramatic change has many negatives to our industry, especially the “will” to fight unnecessary regulations.

Big Pharma does not have the same interests that independent natural food stores have, nor the required heart to do what is right vs. focus on quarterly profits. It’s sad that there are so few natural supplement brands still privately owned by the same family.

Roza: Smaller natural brands built this industry and were able to move faster in response to previously smaller and more niche demand. The fact that global brands are now making sweeping acquisitions is evidence of how mainstream plant-based, healthier eating and supplementation has become – and so, the natural products industry must move forward, continuing to pave the path for the next generation of natural products. We see this cycle, honor it, and innovate to be able to both supply at global scale, and innovate new, novel, efficacious ingredients.

Lau: The benefit of big CPG corps acquiring natural brands is that it increases their reach and distribution. So, it will no longer be something only accessible to some, but it becomes “mass” market. So, the benefit is more people get to enjoy the benefits of our products. The downside by selling and the founders losing controlling stake is that the heart and soul of the company is no longer founder-driven.

I think entrepreneurship has been fundamentally changed since I entered the workforce, 20 something years ago and probably was shifting even before that. In the past, entrepreneurs built companies that they intended to run and keep until they retired or close to it, and pass on to their families.

However, in “modern” entrepreneurship and capital formation, we are looking at the exit strategy, even before companies are launched, because the need to return capital to investors or desire for a big payday. How is that for a pivot?

Lifton: Provided the natural brands stay true to the vision, mission and values of their founders, there are not any real negatives here, only opportunities for good products to get in millions of more hands.

VR: What is the single-biggest contribution your company or organization made to advancing the natural products industry in 2021?

Fabricant: Our fight against FDA’s unlawful regulatory actions regarding NAC has the biggest ramifications. We believe our lawsuit puts FDA’s inconsistent actions under a microscope at a time when they are requesting new authorities like mandatory product listing. As someone who used to sit in the chair, I know I would have a hard time explaining why the agency is acting against a product that has been safely on the market for more than 30 years at a time when simple things like inspecting facilities aren’t being executed. As we await the outcome of our lawsuit, we will continue to review all options as it relates to ensuring FDA is accountable to consumers and to industry.

Richard: NOW continued testing less familiar supplement brands on Amazon and reporting this to Amazon, the trade, media, NPA and FDA. In 2021, NOW did testing on turmeric/curcumin and glutathione products on Amazon.

Testing included potency, heavy metals, radiocarbon testing for naturalness of curcumin, and testing on the vegetarian capsules to see if any products were mislabeled and actually used gelatin capsules. This follows NOW’s ongoing effort of testing products on Amazon and openly reporting the results.

It was gratifying for NOW to receive several industry awards recognizing our efforts to help clean up brands that cheat: NutraIngredients-USA 2021 Editors Award for Industry Initiative of the Year, and Nutritional Outlook’s Best of Industry: Leader award for this initiative, as well as NBJ’s “Efforts on Behalf of Industry” award in May 2021.

Sudberg: 2021 was a tremendous year for Alkemist Labs. We grew nearly 30 percent year over year, hired more employees and invested over $1 million in new equipment to continue to meet the needs of the industry. We’re about to begin offering additional testing services.

Several labs were gobbled up by the industry goliaths and in turn less choices are now available. Aside from being your reliable experts in plant and fungal analysis we have pioneered the concept of Next Generation Transparency. It’s a simple and nearly free concept that gives the admirable players in our industry a vehicle to showcase their quality with consumer-centric C of As.

If you are going above and beyond in the quality department, why not share proof? I started writing about this nearly seven years ago and 2021 was the year it was finally adopted by some of the best brands in the biz. Stay tuned for more on that in 2022. VR

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