Export bans by some Asian countries have halted sales of bovine-based supplements and other products. Now, the FDA has announced an immediate ban on certain high-risk bovine ingredients in supplements and cosmetics sold in the United States. Yet even as industry experts struggle to address new regulatory restrictions, mad cow disease poses a range of new opportunities for others in the nutrition industry.
"Anything that originates from a cow is of perceived concern," said Anthony Almada, president and chief scientific officer at ImagiNutrition (Laguna Nigel, Calif.). While cautioning that a significant gap exists between perceived and actual risks to consumers from bovine ingredients, Almada added, "There is definitely an incentive for companies to secure supplies of materials that are bovine-free but deliver the same processing or biological benefit as bovine materials."
FDA Extends Ban on High Risk Cow Parts to Supplements and Cosmetics
On January 26, 2004 the FDA announced a ban on high-risk bovine ingredients in dietary supplements and cosmetics, as well as foods. The interim final rule takes effect immediately upon publication, although public comment will be accepted afterwards.
The ban prohibits use of any material from dead or "downer" cows. In addition, the new interim rule prohibits use of Specified Risk Materials (SRMs), including the brain, skull, eyes and spinal cord from cattle 30 months or older. Also banned are tonsils and a portion of the small intestines from all cattle, regardless of age. The FDA also prohibited use of mechanically separated beef, which may contain SRMs.
How big an impact will the FDA ban have on the supplement industry? "We estimated in 2001 that glandulars comprised about 0.4% of all dietary supplements," said Phil Harvey, chief science officer at the National Nutritional Foods Assn. (NNFA). "Companies that sell glandulars will have to source differently or look for alternatives." Already, some manufacturers have begun switching to non-bovine materials. Others are sourcing bovine ingredients from Australia or New Zealand, where strict feeding practices have minimized the risk of BSE, he added.
Harvey said that bovine glandular material, including bovine cortex, or cow brains, are used primarily in kinesiology, a muscle-testing discipline within the chiropractic field. Banned cow parts can also be found in some personal care products. For example, intestines in tallow are used in some soaps, face creams and cosmetics.
The ban raises questions among industry representatives. For instance, Harvey questioned whether the ban on small intestines might also include supporting tissues such as pancreas and gallbladder.
"Anatomical proximity raises a concern," said Almada, who suggested the potential for contamination of bovine trachea (a popular source of chondroitin) by tonsil tissue. Almada sees opportunity for suppliers to offer nonbovine alternatives, such as vegetarian sources or materials from animals other than cattle. But even when non-bovine alternatives are available, switching to bovine-free sources can pose challenges. Manufacturers of phosphatidylserine, for example, have faced opposition from the FDA to applications for cognitive disorder claims. The FDA concluded that phosphatidylserine sourced from bovine cortex posed a risk to consumers from mad cow disease, but soy-based alternatives are chemically different and have not been tested to demonstrate efficacy.
Whether the FDA will ultimately force manufacturers to pull existing products with SRMs off the market is still unclear at the end of January 2004. (The FDA did not respond to an NBJ inquiry, and industry experts offered conflicting opinions.) The ban also raises concerns for retailers, Almada noted. "If I"m a retailer, will the manufacturer give me my money back or just come take the product?"
Just how risky are supplements containing bovine ingredients? No one knows for certain. Deaths have reportedly occurred among consumers taking supplements containing bovine brains, but no definitive link has been established. However, some experts estimate that a single supplement pill could contain enough material to transmit BSE to humans.
Tod Cooperman at Consumerlab.com applauded the FDA"s move. "It"s great that the FDA has included supplements in its effort to keep mad cow out of the food supply," he said, adding that the move should help restore consumer confidence in the supplement industry. Whether the FDA might ultimately extend the ban to a broader range of products remains to be seen. "We do have some guidelines," Almada noted, "but who knows what will be the final rule?"
Export Ban Hits MLM Companies
Asian countries including Japan and Korea have banned importation and sale of products containing U.S. bovine ingredients, a move that has impacted multilevel marketing companies selling dietary supplements overseas. "Several MLM companies have been hit by Asian bans on beef products," the MLM Watchdog reported in January, noting that bovine gelatin capsules used for healthy hair and nails have become targets for regulators. "Most are rapidly changing to veggie caps, converting their most popular export items first," Rod Cook, editor of the MLM Watchdog, told NBJ. "Depending on the supply of veggie caps, there should be no long-term effects."
Joe LaPlaca, vice president of dietary supplements/ business development at DSM Nutritional Products, confirmed that the global vitamin supplier"s gelatin customers are seeking BSE certificates for materials. "They want to know where the gelatins are coming from. There is an awareness among the bigger companies, " he said, adding that fears over mad cow are fueling a push for animal-free gelatin alternatives.
Addressing Consumer Concerns
The mad cow scare, like the panics over tainted Tylenol or Alar-contaminated apples, may well be out of proportion to actual risk. But even if processing steps eliminate risk of BSE transmission, some companies may still find sales of bovine-based products down due to consumer perceptions.
Whether consumer concerns will blow over may depend on media coverage and on whether variant Creutzfeld Jakob Disease (vCJD), the fatal brain-wasting illness linked to consumption of BSE-tainted beef, is diagnosed among patients in the United States.
A United Press International article pointed to a disturbing possibility: that vCJD may already have killed some American consumers. The article cited a January 13 warning issued by J.P. Morgan Securities to investors, cautioning that six clusters of CJD in the U.S. have been attributed by health officials as "sporadic" cases.
The advisory speculated that some of these cases may actually be vCJD, a theory that could negatively impact beef pricing. "Given that sCJD occurs randomly in one out of one million cases, it is a statistical rarity to find an sCJD clusterÑlet alone six," the advisory warned. Some clusters involve up to 18 deathsÑfour to eight times higher than expected for sporadic CJD.
In New Jersey, where an eight case cluster of CJD was confirmed in January, state health officials and the Centers for Disease Control still insist the cases are sporadic and warrant no further investigation. Given that there is no federal reporting requirement for CJD and that the testing rate for cattle is minimal, the possibility exists that BSE-contaminated beef may have already entered the food chain. Since vCJD can take years to develop in humans, changes in cattle feeding practices could be too little, too late.
Cautious consultants are advising that shifting to bovine-free sources where practical assures consumer confidence, eliminates regulatory concerns and minimizes the risk of litigation over potentially tainted products.
Although the gelatin industry insists that its products have been proven safe in studies, consumer concerns over BSE could dispel concerns among retailers over paying higher costs for vegetarian gelcaps, Almada suggested. Another possibility is a return to porcine gel caps, which were abandoned by many manufacturers because they are non-Kosher.
"One thing that I think is a major risk issue is the selling of dried beef blood," Almada said, noting that one publicly traded company recently launched an immune boosting product that contains plasma from beef blood. Albumin from beef blood is also used in moisturizing creams and other products.
Since vCJD has been transmitted via blood transfusions in Britain, Almada believes consumers would object to using products containing beef blood. The FDA"s January ban on blood in ruminant feed can only increase such concerns.
Failing to identify a bovine ingredient on labels, however, could backfireÑleading to a loss in consumer confidence for all products by a manufacturer. "To me, it would be a domino effect," Almada warned, offering this advice to supplement makers. "I would err on the side of prudence or conservatism and use materials that are bovine free." Create an alternative for clients and provide testing when necessary to "show that the product works."
Capitalizing on Mad Cow Concerns
Some nutrition companies are launching campaigns to educate consumers about mad cow disease and the advantages of organic products. "Organic BeefÑIt"s What"s Safe for Dinner," a press release from Organic Valley Meat Company announced. Whole Foods Market has touted its stores" natural beef "from cattle raised without byproducts" on National Public Radio.
Consumer groups are advising consumers that beef products from grass-fed and organic cattle pose no health risk from mad cow disease. These messages appear to be having an impact. A Supermarketguru.com poll found that 60% of U.S. consumers plan on changing their beef-eating habits, with 40% saying they would not eat beef at all. Only 13% believed that the U.S. government has the mad cow situation under control.
Those results are higher than an earlier poll by Wall Street Journal Online/Harris Interactive Healthcare, which found 21% of Americans planning to change their beef-eating habits and 16% planning to give up beef completely. That study found an 88% confidence level in the government"s ability to stop spread of mad cow disease.
Consumer jitters over eating beef could spell opportunity for manufacturers of meat alternative products, such as soy or veggie burgers. Increasing consumer awareness of mad cow disease also presents opportunities for manufacturers to utilize organic livestock for value-added ingredients in non-food items, Almada suggested. For example, chondroitin sulfate sourced from organic cattle could be a big seller.
"I also think there could be concern over bovine-based materials in cosmetics," he added, citing consumers" negative emotional response to applying bovine-based collagen or hyaluronic acid (HA) to their skin.
Pet products are another area of opportunity. In Britain, approximately 100 cats have died from FSE, the feline version of BSE. Both are linked to eating tainted beef. Besides organic pet foods, there could be a market in the U.S. for organic rawhide chews for dogs.
"If someone was to make the claim, "Made from organic cattle," everything you would make from yogurt to milk would be an opportunity, " said Almada, who envisioned a collaborative effort between organic beef growers, dairy producers and others. Although some companies face difficulties in the short term, mad cow disease may ultimately provide more benefits than harm to the natural product industry. "I think there is a very big opportunity here," Almada concluded.