Executive Interview: Q&A with Michael McGuffin president of the American Herbal Products Association (AHPA)

Michael McGuffin, president of the American Herbal Products Association (AHPA), has been active in the herbal industry since 1974. He began with a retail store and evolved into herbal product manufacturing when he started McZand Herbal with Janet Zand. By playing a number of roles in the herbal products industry, he has a unique perspective on a very specific area of the supplements industry. As AHPA celebrates its 25th Anniversary this year, we made use of Michael’s frequent flights between Washington DC and California to get his perspective on current issues.

1) Whatever one’s position on the banning of ephedra, in my opinion the industry didn’t handle the events leading up to it well. Is there something we should do differently with other potentially vulnerable herbs?

I am not sure I agree that the description that “industry did not handle…it well” is an accurate representation of industry’s actions from 1996 (when I first testified on this issue) to 2004 (the ban). It might be an accurate way to describe one company’s “misplacement” of several thousand AERs, but that’s not all that happened.

There are some things industry should do to protect other herbs from going the way of ephedra:

First, we should try to identify what those might be. FDA keeps dropping hints and it does not appear that there are very many herbs that they think might be ripe for such scrutiny. The herbal-based ingredients that are mentioned by FDA always include johimbine and bitter orange extracts with higher than the naturally-occurring levels of synephrine.

Next, companies that have something to lose if these herbs are removed can evaluate the potential loss in revenues and decide whether they should invest a portion of that money in conducting basic but credible safety studies on their own ingredients and/or formulas. Don’t forget that FDA is not going to do that work for us.

2) You’ve done a lot of work on New Dietary Ingredients (NDIs). Are there products on the market that may never have been the subject of an NDI but should be?

There is some lack of clarity in the NDI regulations that leaves some room for interpretation. FDA has promised to provide guidance on the NDI regulations, but until that becomes available it is difficult to answer this question. At the same time, marketers of truly unique ingredients should familiarize themselves with their obligations, and recognize that the regulatory process can be successfully negotiated.

3) What strategy do you suggest for companies to both protect a new ingredient and to give it new opportunities?

I have suggested that companies with truly unique ingredients should evaluate whether a combined approach – patent protection combined with a successful NDI submission – might be a way to address the issue. I continue to think this is worth examining, though companies should keep in mind that if this approach does make sense they would need to be vigilant – as with any other patent – in protecting their intellectual property. In other words, the U.S. Patent and Trademark Office is not going to be your enforcer – your attorney would need to do that. Also, it is likely that you would need to provide some level of pressure on FDA to force that agency to keep up its enforcement responsibility.

4) I am appalled that less than half of the companies in the industry support the trade associations that work to further their interests. What are your thoughts on this?

Less than half? Suzanne, you are far too optimistic! I don’t think one third of the industry supports the trade associations. And you get what you pay for. The last time I calculated the arithmetic, the combined dues paid to all of the trade associations came out to about $300 per million dollars in sales. It needs to be more.

5) How would you describe the importance of supporting trade associations, and why do you think some members of industry don’t understand it?

The trade associations need to take some responsibility for this state of affairs – we are not all particularly talented at marketing ourselves. Now, a lot of that has to do with our limited resources and priorities – I am not sure that AHPA’s current members want us to spend very much of their dues on member development, as they want us to be meeting with FDA and developing educational seminars and providing excellent communications, etc.

Why is it important? The main job for each of our members is to run their business. Our industry is made up almost entirely of small businesses, and most of them simply do not have the time or resources to stay alert to all of the factors that go on around them and that can affect their businesses. That’s essentially what they hire us to do. And both small and large companies need to be involved in the decision-making processes of trade associations, since the actions that are taken through these organizations has an effect on the entire trade.

Why don’t they get it? I’m the wrong one to answer that question. When I owned a manufacturing business I made the decision very early on to join AHPA, and also NNFA (now NPA). I did not need any convincing as the role of these organizations, and my need for them was obvious to me.

6) As the industry matures, what do you see as the biggest threats, challenges and opportunities that the industry must address to prosper?

I believe that our greatest opportunity is the simple recognition of the fact that so many American adults want – I should say insist on – access to our products. Threats and challenges? This will all sound familiar, and might be best thought of in the classic division between “internal” and “external” issues.

The largest external challenge may still be the absence of a meaningful enforcement policy by FDA, even against the truly “bad actors.” Another external challenge is the relentlessness of our critics. We need to understand that some of these – for example the American Medical Association, which has called for DSHEA to be amended beyond recognition – are capable of maintaining an attention span across many decades. I recommend reading a book called Copeland’s Cure (Natalie Robins; Knopf; 2005), which follows the conflict between the AMA and homeopathy over most of a century, in which the AMA played a prominent role in marginalizing homeopathy.

The internal challenges will also sound familiar, and the most significant are product quality and claim substantiation. One thing to keep in mind: internal challenges are those that we can do something about. They are within our control. We can fix them if we focus our collective minds, intentions, and pocketbooks. And how do we as an industry best tackle them? Join AHPA! Get involved!! Identify the issues and then help to implement solutions!!! What lessons have you personally learned? Pay attention to our critics, but do not cede the field. A recent example might make the point. Senator Richard Durbin is generally considered this industry’s most fierce critic in the U.S. Senate. In the 108th Congress he proposed legislation (S. 722) that was viewed as an unworkable and punitive approach, at best, to adverse event reports (AERs) for supplements. My strategy was not to ignore him, and not to call him names or demonize him, but to meet with his staff to see if we could find any areas of common interest. I was able to develop an excellent relationship with his legislative assistant, and we came to agree on a different approach to AER legislation – one that balances the industry’s appropriate burden with a realistic regulatory framework.

7) What would it take for there to be more collaboration between companies and trade associations? Do you think this is desirable? Practical?

I would not have the job as AHPA’s president if I did not think collaboration is desirable. A trade association is, by its very nature, a collaboration among companies in that trade who have identified areas of common interest. We can always do more, however, and I am constantly exchanging ideas with our member companies to identify additional opportunities for cooperation.

As far as your question extends to the trade associations, we need to support each of the trade associations to focus on their individual areas of expertise, and to make the most of the strength that is inherent in our diversity. The fact that there are several mature organizations, each with a different culture and membership mix, fosters significant creativity in identifying and addressing the challenges that the industry faces. This diversity also ensures that the special concerns of segments of the industry – such as herbal companies, or retailers – are not ignored. At the same time, it is essential that we collaborate – as we did most recently in getting the SAER legislation through the U.S. Congress – on issues where all of our members have a common interest.

8) Of what AHPA projects are you most proud?

AHPA took a strong position late in 2002 to advocate for a mandatory SAER (serious adverse event report) policy for supplements. Eventually all of our peers and most of the companies in the trade came to support our position, and we then worked together to seek Congressional support for SAER legislation. The result is that the Congress has now passed a law that looks very much like what AHPA proposed in 2002.

I am quite confident that, within just a few years we will all recognize that the dietary supplement industry gained much more, in terms of consumer confidence and a reduction in the noise of our critics’ sound-bites, than it will have cost us to take on the administrative burdens of this law. We are selling a class of goods with a remarkable history of safety, and that will be much more evident once this system is completely in place.

9) Given your broad background, is there anything you wish more retailers knew about manufacturers? Manufacturers understood about retailers?

Retailers should understand that manufacturing herbal supplements is complex, and involves specialized expertise that cannot be easily reduced to simple terms. That’s what we tried to do, starting in the late-80’s, when we tried to communicate a message about “strength” by quantifying marker compounds – we tried to simplify something that is not really simple in practice, and that is actually related to manufacturing consistency – not product strength – and so the whole exercise came to be one of competing numbers. I’ve heard the term “marketing compounds.” Many responsible retailers view themselves as “gate-keepers,” and so they challenge their manufacturers to provide some degree of evidence that they are complying with the retailers’ standards and values. While this may be a positive concept, sometimes retailers submit overly-simplistic or uninformed questionnaires that may not actually provide the information they are looking for, which is “what kind of quality is built into your products?” There is also some impact on manufacturers’ resources when dozens of different retailers ask for this information in a variety of ways. There may be a need for some kind of standardized process to improve manufacturer-retailer communications in this area.

On the other side, manufacturers should recognize that retail unfolds in real time, at a very immediate pace that is driven by the customers – It’s live! Also, manufacturers should know that retailers have long memories. If you treat them right and provide them with high quality products they will support your sales in their stores. On the other hand, if you ever find your products on the bottom shelf it will take a lot of effort to reverse whatever you did to end up there.

10) What challenges do you see ahead for AHPA, and how do you see its role evolving?

As one of four national trade associations in this industry, we each face the same challenge: to maintain our specific relevance. And a unique challenge for AHPA is to balance the reputation that we have gained over the last 25 years for our specific expertise about herbs with the need to communicate to the industry that our influence actually extends well beyond herbs.

AHPA will continue to focus in those key areas that provide the greatest benefit to our members: Representation, both at the regulatory and legislative levels; Communication, to our members, and also on behalf of our members; Education on key issues that meet the needs of the trade; and Self Regulation, as it is always better to write the rules than to read about what just happened to us. We will also expand our role in supporting research through the AHPA Foundation for Education and Research on Botanicals (the AHPA-ERB Foundation).

11) What is AHPA’s role?

Areas in which AHPA plays a unique role include:

Representation: AHPA represents our members – growers, processors, manufacturers and marketers of herbal products – in both legislative and regulatory arenas. We work closely with the FDA and FTC, and also with other regulatory agencies that are sometimes overlooked, such as the USDA.

In FDA’s area of interest, AHPA has developed a very thorough understanding of the regulatory process for new dietary ingredients (NDI’S), and in partnership with the NPIcenter we have produced a searchable database (see http://ndi.npicenter.com/) and guidance documents to assist industry in successfully addressing the requirements for bringing new ingredients to market. We have also been active in reviewing FDA’s adverse event reporting system for dietary supplements, and have communicated to that agency when we have identified news articles that misrepresented the contents of that system.

We have also maintained consistent and direct communications with key staff members at the Federal Trade Commission. We worked with that agency several years ago to develop better industry guidance for advertising of weight loss supplements. Although that project has not been completed, FTC’s recent actions in this area may present an opportunity to revisit this idea.

As I mentioned earlier, our interface extends beyond FDA and FTC. For example, AHPA played a very active role in communicating with USDA when that agency took the position that herbal dietary supplements could not be labeled as “organic,” and we ultimately won that debate. Also, AHPA works closely with the Fish and Wildlife Service, which has a regulatory interest in many of the wild-harvested plants used in the trade. Through our relationship with FWS we are able to attend meetings of and comment on issues before the Convention on International Trade in Endangered Species (CITES). And just last year we were able to complete a series of co-branded (AHPA, FWS and United Plant Savers) brochures to assist harvesters of wild American ginseng to make sure that their collection practices are sustainable.

AHPA also focuses its attention on representing the industry on Capitol Hill. We maintain active communications with all of our industry allies, and have excellent relationships with the members of the Dietary Supplement Caucus. At the same time, we have developed a strategy to reach out to our Congressional critics. Though this strategy can be stressful, and is certainly more work that meeting with our friends and supporters, these efforts have proved to be fruitful in the past and we will continue to work to create better relationships in Washington, DC.

Education: AHPA has developed a unique approach to providing educational information to the trade through our Educational Teleseminars. To begin with, we identify topics that are timely and for which the industry has expressed a need for better training and guidance. The faculty for each event is chosen to include the relevant expertise, and have included representatives of the Food and Drug Administration and the Federal Trade Commission. Attendees at most of these teleseminar receive handouts and guidance documents that often have a value that exceeds the registration fee. And because these are organized as teleconferences, there are no travel costs and the resource demands for our members are minimal.

AHPA Educational Teleseminar topics over the past two years have included:

  • Food Allergen Labeling – This event was designed to make sure that companies were informed of their obligations to comply with the new law that went into effect in 2006.
  • How to Conduct an FDA Inspection – Developed to provide manufacturers with useful tools and guidance so that they know what authority FDA has – and does not have – when inspecting a facility.
  • Substantiation for Dietary Supplement Claims – This teleseminar provided information and advice to assist marketers to ensure that their product claims are truthful and legal.
  • Navigating the New Dietary Ingredient Regulations – In this seminar participants were provided with guidance for submitting to FDA with the safety information that is required for any new ingredients used in dietary supplements.
  • Good Manufacturing Practice – While it has become impossible to predict when FDA might publish its final rule on GMPs for our trade, AHPA believes that the industry cannot wait to address manufacturing issues. We have therefore designed a series of GMP teleseminars, including one that provided an overview of FDA’s proposed rule and one that examined good practices for identifying herbal ingredients. Additional sessions will be scheduled over the next year.


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