These Regulatory Updates are brought to you by Michael Best & Friedrich. 

This Regulatory Update includes information from January 17-31, 2021. Please contact Paul Benson, Taylor Fritsch, or Leah Ziemba for additional information on regulatory issues that may affect your business.

For access to articles and resources from our Premium Member law firm, Michael Best & Friedrich, to help navigate this challenging time, please follow these hyperlinks to Michael Best’s COVID-19 Resource Center and CARES Act Relief Resource Center.

FDA UPDATES

• FDA Issues Warning Letters Following Foreign Supplier Verification Program (FSVP) Inspections MUST READ

• CFSAN Director Summarizes FDA Allergen Regulations MUST READ

• FDA Links Fall 2020 Leafy Greens E. coli Outbreak to Cattle Lots

USDA UPDATES

• Agriculture Secretary Nominee Identifies Eight Policy Priority Areas

• USDA Temporarily Freezes $2.3B in Coronavirus Food Assistance Program (CFAP) Payments

OTHER DEVELOPMENTS

• Federal Judge Refuses to Dismiss Class Suit Alleging Deceptive “All-Natural” Soda Claims

• Groups Fighting Opioid Epidemic Urge Biden Not to Appoint Woodcock as FDA Commissioner

UPCOMING MEETINGS & CONFERENCES

• February 18 – 19, 2021: Virtual Agricultural Outlook Forum (AOF), USDA’s largest annual meeting, on “Building on Innovation: A Pathway to Resilience.” Program to be announced in early December 2020. Register here and read about this year’s program here.
  
  
• View slide decks from past USDA-FSIS meetings and presentations here. 

FDA UPDATES

FDA Issues Warning Letters Following Foreign Supplier Verification Program (FSVP) Inspections
In January 2021, FDA issued warning letters to two businesses following inspections conducted in accordance with the Foreign Supplier Verification Programs for Importers of Food for Humans and Animals (FSVP) rule.

On January 8, FDA warned that Thai Kee Trading Co of San Jose, California was not in compliance with certain requirements of the FSVP regulation, which “requires that importers perform certain risk-based activities to verify that human and/or animal food they import into the United States has been produced in a manner that meets applicable U.S. food safety standards,” according to the letter. Specifically, the agency found that Thai Kee had presented noncompliant FSVP documents for its imported Thai Jasmine rice, Tusino curing powder, and canned mushroom vegetarian broth. FDA also found that Thai Kee did not have required FSVPs for other imported products.

Similarly, on January 19, FDA warned that Alma Reserve, located in Brooklyn, New York, was not in compliance with certain requirements of the FSVP regulation because it did not have FSVPs for its imported products. These products included but were not limited to imported Fudge Candy, Cookies, and Rice Cakes.

Read the warning letters to Thai Kee Trading Co here and to Alma Reserve here. Read the FSVP final here and learn more about it here.

CFSAN Director Summarizes FDA Allergen Regulations
January 28: Dr. Susan Mayne, Director of FDA’s Center for Food Safety and Applied Nutrition (CFSAN), reviewed the agency’s ongoing efforts to protect consumers from major food allergens in an “FDA Voices” article.

Dr. Mayne discussed labeling requirements for the eight major allergens listed in the Food Allergen Labeling and Consumer Protection Act (milk, eggs, fish, shellfish, tree nuts, peanuts, wheat, and soybeans) and lauded the agency’s November 2020 draft industry guidance encouraging manufacturers to voluntarily declare sesame, an increasingly common allergen, in their ingredient lists. Dr. Mayne also described the ongoing issue of undeclared food allergens, which “have been the number one leading cause of Class I food recalls for at least the last three years.” Indeed, since March 2020, FDA has sent warning letters to eight registered food facilities for distributing foods with undeclared major food allergens (resulting in Class 1 recalls). “Finding problems before they can potentially harm consumers is a critical element of the FDA’s allergen enforcement program,” Dr. Mayne stated.

Dr. Mayne closed by promoting the need for scientific developments in the area of “[a]nalytic methods to detect allergens in food.” The agency, she wrote, “is committed to exploring what further steps we can take to better protect consumers with food allergies.”

Read Dr. Mayne’s “FDA Voices” article here.

FDA Links Fall 2020 Leafy Greens E. coli Outbreak to Cattle Lots
January 27: FDA officially completed its investigation and analysis of the multistate leafy greens E. coli O157:H7outbreak that lasted from October 28 to December 22, 2020. According to FDA’s Outbreak Investigation summary, the outbreak “was caused by a strain of E. coli that is genetically related to a strain linked to the fall 2019 romaine outbreak.”

FDA completed a traceback investigation of multiple leafy greens varieties, conducted on-site investigations on farms of interest, and collected and analyzed environmental samples to identify potential sources of contamination. The agency stated that laboratory analysis of these samples “confirmed a positive match to the outbreak strain in a sample of cattle feces, which was collected…on a roadside, uphill from where leafy greens or other food identified in the traceback investigation were grown.”

FDA stated that the finding “confirm[s] the presence of a strain of E. coli O157:H7 that causes recurring outbreaks in a more narrowly defined growing region and a potential, continued source of contamination.” Furthermore, it underscored the agency’s continued recommendation that growers “assess and mitigate risk associated with adjacent and nearby land use practices, particularly as it relates to the presence of livestock, which are a persistent reservoir of E. coli O157:H7 and other STEC.” A detailed report of FDA’s findings is forthcoming.

Read FDA’s Outbreak Investigation summary here.

USDA UPDATES

Agriculture Secretary Nominee Identifies Eight Policy Priority Areas
January 22: Tom Vilsack, President Biden’s nominee for Agriculture Secretary, gave his first interview since the nomination with Art Cullen of The Storm Lake Times.  Vilsack, who served as Agriculture Secretary  during President Barack Obama’s two terms, opened the interview by listing eight policy priorities “that need significant work or even historic work”: (1) COVID-19 relief, (2) Equity and inclusion, (3) Climate and regenerative agriculture, (4) Rural economic development, (5) Nutrition security and assistance, (6) Open and competitive markets, (7) USDA employee morale, and (8) Forest Service management in an era of climate-driven wildfires.

Vilsack also signaled a “fairly significant shift” toward conservation agriculture and renewable energy infrastructure. If nominated, he “envisions creating new markets that pay farmers and foresters to sequester carbon in the soil, funded by credits bought by carbon generators” and plans for USDA to “help develop scientific standards for carbon sequestration that are fundamental to creating a cap-and-trade program,” according to Cullen.

Vilsack’s confirmation hearing will take place before the Senate Agriculture, Nutrition, and Forestry Committee on Tuesday, February 2.

USDA Temporarily Freezes $2.3B in Coronavirus Food Assistance Program (CFAP) Payments
January 27: In accordance with the January 20 White House memo, “Regulatory Freeze Pending Review,” USDA announced that it was temporarily freezing $2.3 billion in supplemental Coronavirus Food Assistance Program (CFAP) payments. The Biden Administration froze the additional CFAP payments, which President Trump’s USDA had announced on January 15, in order to review the rules put in place in the final days of the Trump Administration.

The CFAP webpage states: “USDA has suspended the processing and payments under the Coronavirus Food Assistance Program – Additional Assistance and has halted implementation until further notice…In the coming days, USDA and the Biden Administration intend to take additional steps to bring relief and support to all parts of food and agriculture during the coronavirus pandemic, including by ensuring producers have access to the capital, risk management tools, disaster assistance, and other federal resources.”

During the regulatory freeze, USDA will continue to accept applications for the CFAP program but will not disperse any funds while the program is being reviewed.

Visit the CFAP webpage here. Read the  “Regulatory Freeze Pending Review” memo here. Read about the expanded CFAP payments in our January 2021 (Part 1) Regulatory Update here.

OTHER DEVELOPMENTS

Federal Judge Refuses to Dismiss Class Suit Alleging Deceptive “All-Natural” Soda Claims
January 28: A judge in the Southern District of New York declined to dismiss a putative class action suit against Reed’s Inc. for its deceptive “all-natural” soda claims, finding that some of the plaintiff’s claims were viable(Mason v. Reed’s Inc., 2021 BL 29608, S.D.N.Y., No. 1:18-cv-10826, 1/28/21).

Plaintiff Denise Mason alleged that Reed’s Inc.’s portrayal of its soda as “all-natural” and containing “no preservatives” was deceptive because the soda was made with the preservative citric acid. Since the citric acid had been produced industrially and contained synthetic solvent residue, it would be considered “synthetic” under FDA standards. Thus, Mason argued, the soda label was false and misleading. Judge John G. Koeltl found this claim plausible and said that Mason had raised viable claims about Reed’s Inc.s’ unjust enrichment by the label statements.  The court did, however, dismiss Mason’s fraud claims and held that she lacked standing to seek injunctive relief, such as label changes. The court also put the case on hold and ordered the parties to mediation.

Groups Fighting Opioid Epidemic Urge Biden Not to Appoint Woodcock as FDA Commissioner
January 28: In a letter to the Biden administration, 28 groups combatting the U.S. opioid epidemic called on President Biden not to nominate Acting FDA Commissioner Dr. Janet Woodcock as the permanent head of the agency. According to Chris McGreal of The Guardian, the signatories (including Physicians for Responsible Opioid Prescribing, the consumer advocacy organization Public Citizen, and groups representing families harmed by opioids such as Fed Up!) criticized Dr. Woodcock’s leadership of FDA’s Center for Drug Evaluation and Research (CDER), which is responsible for approving new prescription opioids. Dr. Woodcock served in leadership roles at the CDER on and off between May 1994 and April 2004 and between October 2007 and December 2018.

Specifically, the groups accused Dr. Woodcock of presiding over “one of the worst regulatory agency failures in US history” and decried her “dereliction of duty” for what McGreal describes as “allowing opioid manufacturers to spend years disseminating false claims that narcotic painkillers were less addictive and more effective than they really were, contributing to the rise of mass opioid prescribing and spread of an epidemic that has claimed more than 500,000 lives.” The groups also condemned Dr. Woodcock’s role in approving the opioid Zohydro, “even though the FDA’s own scientific advisory committee voted 11-2 to keep the drug off the market because it was unsafe,” according to McGreal.

As of January 31, 2021, Dr. Woodcock was still Acting FDA Commissioner.