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78 August 2015 | beautystorebusiness.com Beauty & The Law safe under any conditions, or that is not safe under the conditions suggested in the label, will be defined as adulterated and may not be used. The FDA must consider whether there is "adequate evidence to support a reason- able certainty among competent scientists that the ingredient is not harmful" taking into account the probable exposures and cumulative exposures to the substance from all sources. All available test results must be considered. These chemicals are to be evaluated in the first year: • Diazolidinyl urea, a preservative • Lead acetate, a color additive in hair dyes • Methylene glycol/formaldehyde, used in hair treatments • Propyl paraben, a preservative that mimics estrogen • Quaternium-15, another preservative The three preservatives on this list have many applications in cosmetics products such as shampoos and lotions. The FDA may review coal-tar dyes used in hair color at any time. Manufacturers or packers with more than $100,000 in gross annual cosmetics sales must make a written determina- tion that finished cosmetics products are safe if used in accordance with its label before the product may be distributed. The safety determination must be based on a recognized expert organization's conclusions that the product is safe, or testing, or some other "appropriate safety substantiation of the finished product." The bill also requires industry to sub- mit ingredient statements every year. The statements must include a full list of ingre- dients, including ranges of substances present, all fragrances and flavors, and the identity of the fragrance and flavor suppliers. Fragrance and flavor suppliers must identify the ingredients in their prod- ucts at the FDA's request. The cosmetics ingredient statements must include an attestation that the safety of the product and its ingredients have been substan- tiated. Small businesses may submit a streamlined statement if the FDA issues appropriate regulations, and they have a longer grace period to submit the state- ments after marketing a product. The FDA must keep a list of all cosmetics distributed in the United States, together with their ingredients, and provide it to the states on request. States must maintain the information as a trade secret. The FDA may suspend a facility's reg- istration if products manufactured, packed or stored there have a reasonable prob- ability of causing serious adverse health consequences or death. The suspension bars anyone from distributing cosmetics from that facility. A cosmetics ingredient statement may be suspended for the same reasons, and a suspension bars anyone from distributing that product. REGISTRATION Under current law, cosmetics companies— unlike drug companies—are not required to register with the FDA, but may do so under an FDA voluntary initiative for owners and operators of cosmet- ics manufacturing or packing facilities. Manufacturers, packers or distributors may also file a voluntary disclosure of the product ingredients. The Personal Care Products Safety Act would require all cosmetics man- ufacturers and processors to register their facilities annually. Packagers and storage facilities would have to register once every three years. Companies with gross sales averaging at least $500,000 would have to pay a registration fee. The FDA will compile and keep a registry of cosmetics facilities. "GOOD MANUFACTURING PRACTICES" As of now, the FDA has issued guidance for safe cosmetics manufacturing prac- tices but has not required manufacturers to adhere to them. These "good manu- facturing practices" include general hygiene precautions such as making sure workers don't eat in the manufacturing areas, equipment is sanitized appropri- ately, and condensate from pipes doesn't contaminate the products. Similar GMPs are mandatory for drug manufacturing. Under the Personal Care Products Safety Act, the FDA must develop GMPs and propose regulations with the objec- tive of harmonizing with international standards. The rule must be finalized within three years of the law's enactment, but it would apply to large businesses six months after the rule is final, and to small businesses two years after the rule is final. REPORTING INJURIES The current law does not require cosmetics companies to report to the FDA when con- sumers are injured or experience problems with cosmetics. Once again, the FDA has developed voluntary programs for consum- ers to report adverse health effects or problems such as contaminated products. The bill would require manufacturers and packers with more than $100,000 in gross annual sales to include con- tact information on the packaging so that consumers can tell them when they have suffered adverse effects from the product. The manufacturers and packers must, in turn, report to the FDA if there is any serious adverse event associated with a product, and submit an annual summary of the reports that year. Events that lead to death, hospitalization, persistent or sig- nificant disability, disfigurement or birth defects are all defined as significant and adverse, and so are events that require medical or surgical response to prevent those effects. The bill says that filing a report is not an admission that the cosmetic caused the adverse effect, but the reports will doubtlessly be a resource for products- liability lawyers seeking to file lawsuits. RECALLS The FDCA does not give the FDA authority to recall dangerous cosmetics products. The agency can enforce the laws against adulterated or misbranded cosmetics by bringing a lawsuit to ban their sale. The FDA can also have the products seized, and can bring criminal charges against the violators. Continuing the voluntary initiatives under the current law, the Personal Care Products Safety Act would require the FDA to give manufacturers the opportunity to voluntarily recall any adulterated or mis- branded cosmetics. However, the FDA may then order the company to recall a cosmetic and notify distributors and retailers. A press release must be issued that includes information about similar products that are not subject to the recall. PREEMPTION With many exceptions, federal law preempts state laws governing cosmetics packaging and labeling. Where there are gaps in the FDCA, states may issue regulations—and many states have taken the opportunity to issue their own regulations, which are binding in addition to FDA regulations. As examples: The Children's Safe Products Act in Washington State requires manu- facturers of cosmetics targeted to children under 12-years-old to report if children's cosmetics contain any of 66 high-priority chemicals; and California has a law requir- ing cosmetics manufacturers to submit lists of products that contain carcinogens or cause reproductive toxicity. These state laws can create burdens on companies that sell products across state lines or nationwide. It can be very difficult for small companies to monitor and comply with dif- ferent laws in each state. The Personal Care Products Safety Act has a complex preemption provision. It permits all the state safety regulations that are in effect as of the time the law is enacted to continue in effect. But unless a state law is on the books when the federal bill becomes law, states cannot require registration, GMPs, recalls or adverse event reporting. Only those current state safety laws that are more restrictive than an FDA final safety order may be enforced once the FDA issues its final order. If the FDA has proposed a substance for safety review, then states may not impose new requirements on that substance. In a ref- erence to preemption, ICMAD's analysis concludes that the Personal Care Products Safety Act doesn't have "appropriate and significant national uniformity." Finally, the bill provides for fees to fund safety activities from registrants whose gross cosmetics sales for the prior three years is more than $300,000. The target for the FDA to collect from industry is $20.6 million. The fees range from $250 to $1.1 million in the first year. All these areas are going to be in the news as the Personal Care Products Safety Act (or an alternative) possibly works its way through Congress. In addition to the possibility of a new law enacted that affects the beauty industry, they will remain relevant because the FDA will have to final- ize new regulations to implement it. ■ Jean Warshaw is a lawyer in private practice in New York City. She provides advice on business and environmental law. She can be reached at 212.722.2240.