FTC Signals Its Intent to Aggressively Combat Deceptive Health Claims Advertising
In a large-scale push, the Federal Trade Commission advises companies advertising their health- and wellness-related products against making unsubstantiated product claims.
On April 13, 2023, FTC issued a Notice of Penalty Offenses Concerning Substantiation of Product Claims ("Substantiation Notice") and a Notice of Penalty Offenses Concerning Deceptive or Unfair Conduct around Endorsements and Testimonials ("Endorsement Notice") to approximately 670 companies marketing over-the-counter drugs, homeopathic products, dietary supplements, and functional foods. While the notices purport not to reflect any assessment as to whether a company has engaged in deceptive or unfair conduct, they caution recipients to avoid deceiving consumers with advertisements that make product claims that cannot be backed up or substantiated.
Although the distribution of the notices was limited to certain companies reportedly making or likely to make health claims, they are clearly aimed at a broader audience of efficacy and performance claims-makers. In a related press release, FTC stated it will be taking a more aggressive enforcement stance on deceptive advertising, and that it may seek civil penalties against companies engaging in conduct that they know has been found unlawful in previous FTC administrative orders, other than consent orders.
The notices itemize acts or practices determined by FTC to be deceptive or unfair, including the following:
- Making objective product claims without a reasonable basis consisting of competent, reliable evidence;
- Representing a product is effective in curing, mitigating, or treating any serious disease, without at least one human clinical trial meeting certain criteria;
- Misrepresenting the level or type of substantiation for a claim;
- Representing that a product claim has been scientifically or clinically proven without evidence sufficient to satisfy the relevant scientific community of the claim's truth;
- Falsely claiming an endorsement by a third party;
- Misrepresenting whether an endorser is an actual, current, or recent user;
- Using an endorsement to make unsubstantiated or otherwise deceptive performance claims;
- Failing to disclose an unexpected material connection with an endorser; and
- Misrepresenting that the experience of endorsers represents consumers' typical or ordinary experience.
With the continued foreshadowing of enforcement, companies should consider conducting a comprehensive review of their advertising materials and the practices by which they are created to understand whether claims could be viewed as unfair or deceptive acts or practices related to substantiation or endorsement.
