Beauty Store Business

AUG 2019

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58 August 2019 | beautystorebusiness.com A BRIEF HISTORY Los Angeles-based Ronie Schmelz, counsel or the Tucker Ellis law irm, notes that the Food, Drug and Cosmetic Act o 1938 led to ederal regulations that still govern the cosmetics industry today. "The other legislation is the Fair Packaging and Labeling Act [passed in 1967], which deals with labeling," Schmelz adds. "Those two were designed to comprehensively reexamine the extent to which cosmetics are regulated, increasing regulation or those companies." Fortunately, Blinko stresses, cosmetics have the best saety record o any class o products regulated by the FDA, including drugs and medical devices, which undergo rigorous FDA review, as well as oods and dietary supplements. "While the press has ocused on the saety o cosmetic ingredients, most o the ingredients used in cosmetic products are also used in products that have been subject to saety review by the FDA, either based on use in drug products or other FDA programs that require FDA pre-market review," Blinko says. "Both the Feinstein-Collins bill and the drat bill are modeled ater the Food Saety Amendments, legislation to address signiicant health risks in the ood industry created by oodborne illnesses, which struck some 48 million Americans, hospitalizing hundreds o thousands and killing hundreds o thousands." Blinko explains that the Food Saety Amendments provided the FDA with greatly enhanced oversight authority over the ood industry, including dietary supplements. For example, all ood acilities (including warehouses in the ood distribution chain) were required to register with the FDA, which was also granted the authority to immediately stop distribution o ood that was suspected to create an undue risk, without having to institute litigation. The FDA was given enhanced inspection rights, and the right to order recalls. The act also required ood acilities to adopt stringent good manu- acturing practices (GMPs), along with import supplier veriication. "While the Food Saety Amendments granted the FDA ar greater oversight, health and saety issues in the ood industry continue to be a problem," Blinko laments. "I passed, both the Senate bill and the House drat would signiicantly enhance the FDA's authority over cosmetics–and would wind up regulating cosmetics more stringently than most over-the-counter drugs." WHAT'S AT STAKE? The EWG notes that, with the exception o color additives, the FDA "lacks the power and resources to review the saety o chemicals in cosmetics …. Under current law, cosmetic companies do not have to register with the FDA, submit cosmetic ingredient statements, adopt GMPs, provide access to saety records or report serious adverse events like hospital- ization when they occur. The FDA also lacks the authority to quickly suspend production or recall contaminated products when a company ails to initiate a voluntary recall. By contrast, ood, prescription drug, over-the-counter drug and medical device manuacturers are subject to almost all o these basic consumer protection rules." Thereore, the Personal Care Product Saety Act is designed to address those issues. EWG oers a summary o some key elements o the bill: • Personal care product companies register acilities and cosmetic ingredients with the FDA. • Companies disclose the ingredients they use and attest that they have saety records or their products. • Companies must report serious adverse events (such as inections that require medical treatment) to the FDA within 15 days rom the time o occurrence, and an annual summary o all reported adverse events (including less serious reactions, such as rashes). • Speciic labeling and warnings may be required or some products that contain ingredients not suitable or the entire population, such as "or adult use only" or "or proessional use only." • Websites selling cosmetics must include ull labeling inormation, including ingredients and any warnings. • The FDA will collect data and inormation on at least ive ingredients per year and determine their levels o saety, including determining how much o the ingredient may be used, and i it should be restricted to only certain types o products (e.g., not or use in children's products). • The FDA may order a recall i a product is likely to cause serious harm and the company reuses to do a voluntary recall. • The FDA will issue regulations that outline GMPs–how companies should saely manuacture personal care products. The Personal Care Products Saety Act is supported by EWG and others: manuacturers like Beautycounter, Estée Lauder Essie and Elizabeth Arden, as well as organizations such as The Handcrated Soap and Cosmetic Guild, March o Dimes and the American Academy o Pediatrics. The House drat bill, introduced by Reps. Frank Pallone Jr. ( D-New Jersey ) and John Shimkus ( R-Illinois ) , contains many similarities, according to Schmelz, but some key dierences. "Both bills would require manuacturers and those processing cosmetic products to register those acilities with the FDA," she reports. "One slight dierence in the House drat is having acilities simply engaged in packaging and holding cosmetics to also register, whereas the Senate bill ocuses on those manuacturing, processing and ormulating cosmetic products." Schmelz also notes that, as both bills require the FDA to conduct saety reviews on particular cosmetic ingredients, ive are identiied in both: diazolidinyl urea, diethyl phthalate, methylene glycol/methanol ormaldehyde, propylparaben and quaternium-15. "The FDA, during the iscal year 2020, would look at and complete a saety review or these ive ingredients, as well as nonunctional constituents that have not previously been reviewed," Schmelz explains. "It's a base assessment by scientists that an ingredient is not harmul under recommended or sae suggested use–but also notes that the FDA can't consider an ingredient or non- unctional constituent harmul just because it causes minor adverse reactions, like transient allergic reactions or skin irritation in some users." Finally, both bills address animal testing. "The Senate bill says it's the 'sense o the Senate' that animal testing should not be used, with exception o appropriate allowances," Schmelz notes. "The House drat goes into more detail, encouraging use o alternative testing–and encouraging the FDA to issue guidance or scientiic and reliable alternatives to animal testing." STICKING POINTS This proposed additional oversight by the FDA comes with a cost–to the tune o $20.6 million, expected to be paid by the beauty industry itsel in the orm o ees rom manuacturers, in a tiered structure. "They're looking to generate revenue rom the industry, depending on gross annual sales," Schmelz says. "So, i revenue is $2 to $3 billion, the ee is $610,000; between $20 million and $40 million, there's a $12,000 ee–that's in the Senate bill. The House bill has a slight variation: The top ee in the Senate bill is $1.35 million; in the House bill, it's $1.1 million." Blinko supports some level o modernization, such as better reporting and GMPs, but is concerned about those ees negatively aecting smaller businesses–or, indeed, preventing them rom ever coming to market at all. She wonders how those ees will be passed on to the con- sumer in terms o higher prices on the shelves. "The common position asserted to argue that

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