Around 1996, when the internet was just starting to take off, and you really noticed when an advertisement had that funny new “WWW” address in it, I got the idea to have an internet-based Chinese herb pharmacy. I started working on the framework for AncientWay.com then, and it’s been a huge part of my life and business ever since. It was one of the first easily accessible English sites for Chinese herbs, and hopefully still stands out as a responsible, customer-oriented source for good quality TCM products.
AncientWay.com is no longer unique–many Chinese herb websites sell similar products. Some sell a wider selection. Some popular product lines aren’t available on AncientWay.com, but are available elsewhere. And some sites tell customers what herbs are used for and even will sell them an online consultation to prescribe via e-mail or phone.
I started my business on a shoestring I borrowed from Sallie Mae. It was 1999 and I had recently returned from teaching English in Taiwan for a year. Student loan payments were about to begin and I only had enough money for a month of bills. No bank or relative would help me out. I learned that using some peculiar loopholes, I could become a part-time student, take out more student loans, and that would freeze the interest and payments on my loans. The loans would go to help me with food and residence, allowing me to put all the money I made from Ancient Way back into the business.
Southern Oregon University in Ashland, Oregon (just over an hour away from Klamath Falls) was where I took courses at first: Small-Business Startup, Botany, and a new Criminology course, called Crime on the Internet. My focus in the Criminology course was about the legal issues around my business plan to sell herbs online. At the time, I still intended to sell online consultations. I even wrote up an agreement for potential internet patients which told them they were “virtually visiting” me in Oregon. Later I learned that is well-established in courts that such “telemedicine” always regards the practitioner as visiting the patient in their state, and that if you don’t have a license in the patient’s state, it is “unlicensed practice of medicine across state lines.” This is at least a misdemeanor in every state, a felony in some. Oops, back to the drawing board!
The Criminology teacher, a pretty redhead, was dating a DEA agent who mostly sat in back and stared at her with puppy-dog eyes. I might be exaggerating, but it sounds good. Perhaps most of the class were puppy-dogs, including me. Anyhow, I picked both of their brains for info on drug laws and internet sales of supplements and herbs. The DEA agent was mostly focussed on Southern Oregon methamphetamine issues. Essentially they told me that this was a new area which not much was known about. They directed me to the Food, Drug, and Cosmetics Act, which was put into place for consumer protection in 1938 (replacing the Pure Food and Drugs Act of 1906). Yes, I know the FDA is partly a corrupt bureaucratic behemoth now, that’s a different story.
One would think that getting a Master’s Degree in Acupuncture & Oriental Medicine would include a course in dietary supplement laws, herbal product labeling laws, the history of the regulation of drugs, foods, and supplements. It didn’t, so I’ve done a tremendous amount of studying on my own since. As far as I can tell, most acupuncturists and Chinese herb companies either don’t know these laws or choose to ignore them.
Why do the drug and supplement laws matter?
Of course I’d like to grow my business, make enough money to retire before I’m 120 years old, and create some new jobs for my tiny, depressed town. I have the equipment, experience, and suppliers to make some very high quality herbal products. I’m not all that uptight about breaking laws if there is no external victim (i.e. if nobody else gets hurt), such as driving really fast on a desert highway when you see the road is empty to the horizon, or growing marijuana in your garden (just don’t push it on kids). The drug laws were put into place in response to many 1800′s patent medicines, such as Mrs. Winslow’s Soothing Syrup for Children Teething.
Morphine, opium, cocaine, amphetamines, cannabis… The late 1800′s were better than the sixties for ready access to cheap drugs! While I’m a proponent of decriminalization of most drugs and releasing non-violent drug offenders from jail (think of the money and families that would save!), I am a fan of the scientific method, proving drugs are safe and effective before marketing them, and truth in advertising.
Unfortunately, this makes it very difficult to compete in my industry. As I’ve blogged about in detail, many Chinese herb companies are marketing products clearly claiming to treat serious conditions like ovarian cancer, AIDS, gonorrhea, herpes, breast lumps, schizophrenia, and just about every other disease out there. Very few of those claims are supported by good research.
Censorship is as abhorrent to me as locking up pot-heads (training a hippy gardener for a career in organized crime doesn’t help society). I like to write, particularly about herbs, drugs, and legal/ethical issues. I also sell herbs, and would like to sell even more! This is a fine line to walk, and it is important to pay attention to details and facts.
Fortunately, the Food, Drug, and Cosmetic Act (“the Act”) addresses this issue directly, and makes it clear what types of publications are and are not considered part of Dietary Supplement Labeling:
United States Code, 2010 Edition
Title 21 – FOOD AND DRUGS
CHAPTER 9 – FEDERAL FOOD, DRUG, AND COSMETIC ACT
SUBCHAPTER IV – FOOD
Sec. 343-2 – Dietary supplement labeling exemptions
From the U.S. Government Printing Office, www.gpo.gov
§343–2. Dietary supplement labeling exemptions
(a) In general
A publication, including an article, a chapter in a book, or an official abstract of a peer-reviewed scientific publication that appears in an article and was prepared by the author or the editors of the publication, which is reprinted in its entirety, shall not be defined as labeling when used in connection with the sale of a dietary supplement to consumers when it—
(1) is not false or misleading;
(2) does not promote a particular manufacturer or brand of a dietary supplement;
(3) is displayed or presented, or is displayed or presented with other such items on the same subject matter, so as to present a balanced view of the available scientific information on a dietary supplement;
(4) if displayed in an establishment, is physically separate from the dietary supplements; and
(5) does not have appended to it any information by sticker or any other method.
Subsection (a) of this section shall not apply to or restrict a retailer or wholesaler of dietary supplements in any way whatsoever in the sale of books or other publications as a part of the business of such retailer or wholesaler.
(c) Burden of proof
In any proceeding brought under subsection (a) of this section, the burden of proof shall be on the United States to establish that an article or other such matter is false or misleading.
(June 25, 1938, ch. 675, §403B, as added Pub. L. 103–417, §5, Oct. 25, 1994, 108 Stat. 4328.)
That’s the scoop. Let’s dissect it and make sure we understand it, as it is the basis of responsible, legal marketing of herbs and supplements.
The issue of what becomes the product’s “labeling” is important because any claims on in “labeling” which promote the supplement for a specific disease turn it from a supplement into a drug. If it isn’t an approved drug, it is an “Unapproved New Drug” and thus is “Misbranded” and illegal to market. Theoretically, the FDA is looking out for misbranded, unapproved new drugs, and can take whatever action is needed to get them off the market. Practically, they are busy playing golf with pharmaceutical executives, and only work to get things off the market after someone melts their nose off their face or experiences kidney failure necessitating a transplant. It’s very much a “buyer beware” market still.
The first part specifically says “shall not be defined as labeling when used in connection with the sale of a dietary supplement.” This covers:
- A publication
- An article
- A chapter in a book
- An abstract from a peer-reviewed scientific journal
But to qualify, it cannot:
- Be false or misleading (which the government would have to prove)
- Promote a specific manufacturer or brand of a dietary supplement (that’s the big one!)
- Be displayed along with the supplement and without a balanced view of available scientific information.
- Have stickers or other info attached (I assume this mainly is about promoting a particular brand as well).
The second part is very clear that a retailer or wholesaler of dietary supplements isn’t restricted in any way regarding the sale of books or publications. This emphasizes that it is the manufacturers who are mainly restricted in how they present marketing materials for their supplements.
The key point here is that a manufacturer of a dietary supplement cannot legally write books or articles they use in connection with selling their products if those publications promote their own brand by name. Once they do that, the marketing materials become part of the labeling, and turn the supplement into a drug. That then makes them illegal to introduce into interstate commerce until they have been approved through the New Drug Approval process.
However, in the interest of free speech and scientific progress, the Act allows a manufacturer to publish and reprint articles in connection with supplement sales as long as they don’t mention a brand name, aren’t false, and present a balanced scientific view.
I can live with that. It’s sensible, designed to protect the consumer, still allows a manufacturer to have free speech in promoting research regarding their ingredients, and lets herb stores sell publications on supplements without having to fear jackbooted thugs using their book section as an excuse to knock down the door.
But doesn’t everyone in the Chinese herb industry break those rules?
Not everyone does, but it is very common. Many manufacturers, especially the ones who sell only to acupuncturists, also publish books with very specific recommendations about each product they sell, clearly organized around their brand names, and clearly including claims to treat serious diseases which often lack any supporting references. Mayway (Plum Flower) published a great book a couple years ago, but quickly took it off the market and requested to acupuncturists that they not use it in their clinic when they realized what the legal issues were around publishing a book that promoted their own brand. That increased my faith in Mayway’s ethical and legal integrity, which was already outstanding. However, many acupuncturists have no clue about these laws, and regularly reference the books freely provided to them by the manufacturers they do business with in prescribing their products to patients. I did that for years, too. It’s very easy, and doesn’t feel wrong.
Only when you figure out how un-level the playing field is do some of these things click into place. Mayway reminds me of a Chinese gentleman martial artist (like Ip Man of Wing Chun Kung Fu fame, a great movie!). When taunted by bullies, he politely stays silent. Other schools may be doing a bigger business with more students due to their loud claims of superiority, and the Chinese gentleman just stays centered on his own personal practice. Eventually in the movies, he gets to kick some serious tail and is a hero in the end. But that’s the movies.
Similar to the mainstream pharmaceutical companies, some of the biggest players in the Chinese herbal supplement world have ignored these laws for years, growing their business through blatantly promoting their products for conditions for which there is no supportive research (Chinese research on rats doesn’t qualify for marketing something for human use in the US). There is no question that their product literature makes their supplements into misbranded drugs. The question is, how long will they get away with it before there is an industry-wide crackdown? Or will they just keep raking in the profits and one day be “grandfathered” in after they buy the right politician?
In either case, it makes it nearly impossible for a small company to get into this market in a legal and ethical way. If you can’t produce competitive marketing materials without committing a felony, it really isn’t worth the investment of money and time to get into that market. Even if you have a better idea, cleaner product, or can create local jobs!
As you can tell, I have thought about this a lot. Here are a couple of questions I ponder:
Can a mainstream drug company invent a new drug and promote it as a supplement to treat diseases if they “only sell it to licensed doctors”?
Could they do that if the new drug is 100% natural? An herb extract? A sugar pill?
Who is more ethical: A marijuana dealer or an herbal supplement manufacturer who sells something they promote to treat cancer?
Both the marijuana dealer and the supplement manufacturer are breaking laws. But the customer of the marijuana dealer just wants to get high. The supplement customer now expects to have an effective treatment for cancer. The marijuana buyer knows the product is illegal. The supplement customer usually assumes that the product is legitimate, especially if purchased through a licensed practitioner. The dime-bag pot dealer may be the middleman for the pot grower, but probably knows his product line well enough to determine that it’s genuine weed and of good quality. The practitioner/reseller of the supplement probably takes the word of the manufacturer, but doesn’t really know if the product can treat cancer or not, or whether it actually has what it says inside.
An example of this is PC-Spes, which was made by BotanicLab, claimed to be just Chinese herbs and Saw Palmetto for treating Prostate Cancer, but found to have synthetic estrogen (DES), warfarin (Coumadin–to prevent blood clots from the estrogen), and Xanax (for anxiety!) hidden in it. This was 2002, and there were even studies being done. It was very popular at the time, and the herbs it claimed to be made of were selling well.
Drug companies who had approval to market a drug for osteoarthritis but not rheumatoid arthritis went ahead and marketed it to doctors for rheumatoid arthritis and other “off-label” uses. They received the biggest criminal fines in US history as a result. They probably still made more than that in profits. They’re still in business.
Some herb companies have set up separate corporations to publish the manuals for their products. The manuals still mention their products by brand name, lack balanced scientific information, and are given/sold to practitioners along with the pills. I think they don’t understand the laws, but it is clear they are intending to get around them in the effort to grow their profits.
Yes, this is my response. I’d prefer to be selling more herbs, but won’t become a criminal to compete. I am still profit-motivated, and hope that by writing from a consumer-protection and practitioner-education perspective, I’ll gain more loyal customers (even if I don’t tell them what is a “good remedy for cancers and venereal diseases”) and help practitioners choose to do business with the few legal, ethical supplement companies. Acupuncturists, herbalists, and consumers should be doing their own research using critical thinking skills to evaluate traditional treatments in the light of modern scientific research.
Goal: To promote legal, ethical, evidence-based natural medicine practice.
Disclosure: I want to make money in legal and ethical ways. I currently sell dietary supplements online and run an acupuncture clinic.