March 9, 2026 • 22 mins
In this episode of the KLF Deep Dive, Darshan Kulkarni sits down with Phyllis Marcus, Vice President of the National Advertising Division (NAD) and former FTC veteran. They unpack the complex "grey area" where healthcare professional (HCP) communications bleed into the public consumer space. Phyllis reveals why labeling an ad "For Healthcare Professionals Only" may no longer protect a company from regulatory scrutiny and explains the NAD’s role as an independent adjudicator in high-stakes pharmaceutical disputes. If you are navigating the intersection of FDA, FTC, and NAD jurisdictions, this masterclass in advertising law is essential listening.
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Episode Transcript
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SPEAKER_00 (00:00):
Welcome back to the KLF Deep Dive.
I'm here with Phyllis Marcus.
You've seen her before.
She was on here with us, I wantto say a couple of weeks ago,
and she was kind enough to talkto us about her perspective from
the NAD.
She works with the NAD, she doesnot necessarily represent the
NAD.
I just want to be clear aboutthat.
Not neither of us is givinglegal advice.
However, this is supposed to beeducational.
(00:20):
Phyllis, tell us a little bitabout you.
SPEAKER_01 (00:22):
Well, um, I am the vice president of the National
Advertising Division at BBBNational Program.
So I do work directly with theNAD, but you're right, Darshan,
that today the views that youand I will be expressing are our
own because I'm sure we'll godown certain paths, um, surmise
(00:43):
certain things, and kind ofunpack other things.
Um, I previously was a law firmpartner for a decade, and before
that, I spent almost two decadesat the Federal Trade Commission
doing consumer protection,enforcement, and regulatory
work.
SPEAKER_00 (00:58):
Let me ask you a really simple question because
you use the word consumer, whichis very interesting to me.
Because do you see from yourperspective, from the vantage
point of being at the NAD, thatthe FDA and the FTC are looking
at the needs of consumers?
And the word consumer implies asort of um end user who decides
what product they buy.
(01:20):
So is it still consumer or isthere a different balance you
look at?
How does that kind of, from yourvantage point, how does that
make sense?
SPEAKER_01 (01:26):
So I I can answer this question in two ways.
SPEAKER_00 (01:29):
Okay.
SPEAKER_01 (01:30):
Um, who is a consumer is not solely um the
end lay person on the street.
And we at the NAD have a numberof cases where we look at the
relevant consuming audience, andhealthcare practitioners can be
(01:50):
one of the relevant consumingaudiences.
In addition, based on neweradvertising techniques, and soon
enough we're not even going tobe able to say that digital
advertising is so new, but umwith the proliferation of
digital advertising, layconsumers are likely to see
(02:12):
advertising messages, even ifthe original intended audience
was a set of professionals.
So when companies put messagingon their websites, for example,
or use social media todisseminate messages, the
broader consuming public isingesting that information.
(02:35):
And um, they aren't justcabineting their exposure to the
commercials that people see onTV that are intended, you know,
only for the end user.
So um that is that's a longanswer to the consuming public.
We can protect and look athealthcare professionals as one
(02:59):
consuming public, and we canlook at the broad array of
materials in making ourdeterminations in protecting
regular consumers.
SPEAKER_00 (03:12):
How do you reconcile those two when you're saying as
as as is reality that patientsor lay consumers will access
both?
SPEAKER_01 (03:23):
Well, perhaps one of the links is in looking at what
is then communicated fromhealthcare practitioners down to
the public for whom a particularmedication is being prescribed.
So if the messaging that iscoming from a company is
(03:44):
potentially deceptive ormisleading, and then it is being
passed along to consumers, thatis problematic.
And so we have not shied awayfrom challenges that have been
brought before us where aportion of the advertising
(04:06):
assets are directed tohealthcare practitioners.
I'll give you an example.
We had a pair of cases,challenges brought by Sanafi
against Galderma for Galderma'smarketing of an eczema drug
called nemluvia.
(04:26):
And the two cases involvedslightly different claims and
different mechanisms ofadvertising.
So the first case, which I'llcall nemluvia one, involved
website advertising, direct topublic, and um assets directed
(04:47):
to healthcare practitioners.
We did not say that thehealthcare practitioner
advertising was off limits forour consideration.
And I apologize if you guys seemy camera moving up.
I'm putting it back down.
Now, the second case, Nemluvio2, involved solely a commercial.
(05:08):
And so that was direct toconsumer advertising.
Um, again, same product, sametwo companies bringing the
challenges, differentadvertising media, uh, same
analysis brought by us.
Because to be honest with you,you know, what we're missing in
this discussion is the realityof how communications to
(05:31):
healthcare practitioners um makeit into the marketplace.
They also are available online.
And so how do you mean you cansearch?
There are websites, and um, theyare accessible to the viewing
public as well.
And so um you you're right, weare not parsing these two
things.
This is enjoying our content,we'd love to hear more.
(05:56):
Please like, comment, share, andfind more.
Now, I'll turn the tables on youand ask.
Um, in the FDA context, then,um, how are how is the FDA
viewing those same materials?
SPEAKER_00 (06:14):
So it's not just the FDA, it's also the DOJ, right?
Because uh technically OIG.
But um the FDA will generallycomment on and they'll add uh
discuss claims made indirect-to-patient uh stuff.
They will not typically get intodirect-to physicians as much.
On the other hand, you will seesettlements from OIG that
(06:39):
involve physicians becausephysicians have then taken, have
switched their roles.
So in those cases, the DOJ takesthe position that you weren't
acting as a physician in thatrole, you were acting as a
salesperson who just happened towear a white coat.
Um, so that's how thatdistinction has been parsed.
(06:59):
There are guidances from theFDA, for example, the SIUU
guidance, um, and which is thescientific exchange guidance,
and then there's the one calledthe CFL or the consistent of the
label guidance, which do getinto it.
There's a whole bunch ofdiscussion about whether that
applies in the context of actualHCP communications, because the
(07:20):
question is can the governmentregulate that in the same way?
Because that goes into, again,First Amendment discussions.
So I might argue that that isstill a sales discussion and how
to do it properly because theFDA has lost a bunch of court
cases starting from about 2012on the regulation of this type
of discussion.
So it's a it's a veryinteresting, nuanced argument.
(07:43):
And I think a lot of people, andI know practitioners who
disagree on exactly this point.
SPEAKER_01 (07:49):
So and I will I will I will tell you, um, our role is
different.
We are not a government entity,we are an independent,
not-for-profit, self-regulatoryorganization.
And so some of those constraintsthat you're describing do not
apply.
SPEAKER_00 (08:09):
Let me ask you this.
So when you're in a positionwhere you are helping guide
companies who are saying, youknow what, no, no, this is HCP
versus non-HCP, how do you beginto explain to companies that I
don't care?
Uh it's this, it's a differentaudience.
We're not uh an agency.
SPEAKER_01 (08:31):
So um, so we are not uh a guidance offering body.
Um, we are uh adjudicators,essentially, of disputes between
companies.
And so um part of the answer isan easy answer.
I'm not developing guidanceexcept in the context of the
(08:52):
cases that we issue and thedecisions that we draft.
And so from the viewing publicthat is familiar with the body
of cases that we've issued atthe NAD, um a discerning reader
will see that certain of ourcases will involve um uh
(09:14):
advertising statements made tohealthcare practitioners.
Um, parties do have an abilityto make jurisdictional arguments
before us, but our criteria isthat the the claim or claims
have to be national in natureand advertising in nature.
And so if they pass muster, theyare both national and they are
(09:37):
advertising, we will reviewthem.
SPEAKER_00 (09:41):
But but what constitutes advertising in that
situation?
SPEAKER_01 (09:44):
Well, I'm not um because you and I are talking,
I'm not gonna pull up thedocument right now, but we do we
do have a uh a definition of ofwhat is advertising.
And so um, you know, I'm not inprivate practice any longer.
If I were, those questions umwould be brought to me by
clients and uh and we would talkthrough them.
(10:06):
But we're serving a differentrole at the NAD, and um, and I'm
thankful then that I don't haveto answer some of these
questions that you're bringing.
SPEAKER_00 (10:15):
Fair enough.
I eat need to go subscribe tothe NAD database, find out a
little bit more.
SPEAKER_01 (10:20):
And and you know, for for those listeners, um, and
I may have said this in our lastdiscussion, but it can't be said
enough.
If you want to understand whatis happening in the world of
advertising, subscribe to ourpress releases.
And if you've got um the meansto do it, I would say um become
(10:42):
a paying subscriber to ouronline archive.
It is a treasure trove goingback decades of our written
decisions.
Um there are easy ways to searchand find those decisions, and
you can see really in-depthanalysis about um how we make
(11:04):
our recommendations anddeterminations.
So that's my plug.
SPEAKER_00 (11:07):
Now, let me ask you a burgeoning area that people
are playing around with andthey're trying to understand how
to analyze this.
The standards that the FDA usesfor a compounding pharmacy, and
one might argue they don't havethe same jurisdiction because
the FTC does, not the FDA,because of the whole
(11:28):
prescription thing.
Um, is that different?
And what is the FTC'sjurisdiction?
Because we all know about thatin our company memo, which
outlined their jurisdiction.
SPEAKER_01 (11:42):
The the agreement that you're talking about is
from the 1970s, if I'm notmistaken.
That's why.
Um and it's memorandum ofunderstanding between the FDA
and the FTC, and it's long beenin place.
And the FTC has other MOUs withother agencies where there's
overlap.
And so um, the two agencies kindof divided up the world at the
(12:04):
time, and the FTC took umover-the-counter labeling and
advertising, and the FDA tookprescription drug labeling and
advertising, and I believe thatsplit remains.
Now, when the NAD gets involved,and we we have gotten involved
(12:29):
in prescription drugadvertising.
Um, so our jurisdiction isdifferent than the FTC's
jurisdiction.
We're not an agency, we're anorganization and
non-governmental at that.
SPEAKER_00 (12:43):
So, what does the word discontinue claims mean in
this case?
SPEAKER_01 (12:48):
So we expect permanent discontinuance of the
claims that were in thechallenge.
And so um it sounds kind offormulaic and rigid, but um, the
challenger submits a complaintto us.
We don't go out and find otherpotentially problematic claims.
So it is up to the challenger toidentify the claims that they
(13:12):
want us to review.
The target of the um challengehas the option of saying, we're
looking at these claims and weare going to permanently
discontinue them.
A party can agree to adhere toour recommendation, which is
keep the claim in themarketplace because you've
(13:32):
substantiated it, modify theclaim in some way because we
think it can be modified, ordiscontinue the claim because it
cannot be made without it, itcannot be made in a truthful and
non-deceptive manner.
So it's these claims, thisrecommendation, and we match
them up.
We don't have any more expansivepower to say and don't uh make
(13:58):
any health-related claims in themarketplace or don't make any um
other claims relating to thisproduct and its efficacy.
We just look at what was broughtbefore us in the complaint and
judge those claims.
SPEAKER_00 (14:13):
So interesting to me because there I'm thinking of
like 15.
I've been writing notes down asyou can tell, and I have like a
bunch of questions.
But at the end of it, is therelike a settlement agreement or a
order or how how do you put downthe five agreements?
SPEAKER_01 (14:28):
You know, now we get technical.
Um, for those of you who want togo access our online archive as
subscribers, you'll see this.
I mean, we have a format inwhich we write our decisions, we
set forth who the parties are,we describe what the claims are
that have been identified thatare the subject of the
challenge, and we go item byitem or uh bucket by bucket and
(14:51):
we analyze them based on thesubstantiation and the arguments
that the advertiser haspresented to us and whether
there are any counterargumentspresented by the challenger.
So in each section of ourdecision, we will make a
recommendation as to that bucketof claims.
(15:11):
And as I said, it's either thatwe found that those claims can
be substantiated and they shouldremain, or the claims need to be
modified or discontinued.
At the end of our decision, wesummarize all of those
recommendations.
So if you were only reading onepart of the decision, you know,
rip off the conclusion and takethat as your guide sheet.
(15:34):
Now, advertisers have theopportunity to submit, and it is
part of the written decision,what we call an advertiser's
statement.
So in that advertiser statement,um, the advertiser is required
to say right off the bat, at thebeginning of that advertiser
(15:56):
statement, they may say, whilewe heartily disagree, we will
comply.
Um, or uh we can't live withthis, and therefore we will not
comply.
So we require the advertiser tostate right uh at the outset
what they're going to do withour recommendations.
(16:17):
We then say, as a result of theadvertiser's decision not to
comply, we will be referringthis case to the appropriate
regulatory or oversightagencies.
And in the case of digitalmedia, we also refer to the
platforms on which theadvertising has appeared.
(16:38):
So there's not a settlementagreement per se, but the
advertiser is required to statewhether they will adhere to our
recommendations or not.
Now, these um the NAD decisionson our recommendations are not
enforceable by law.
They don't carry the same powerthat uh, for example, an
(17:00):
agreement of voluntarycompliance might, um, or a
consent order or decree comingout of one of the agencies.
Again, we're an independent,not-for-profit, voluntary,
self-regulatory organization.
SPEAKER_00 (17:16):
A campaign can be two months long and then they're
moving and shifting, and someonecomes in and says, discontinue.
We were that was three claims,that was three ads ago or three
program, three programs ago.
How does the NAD combat thisissue of they're just moving too
(17:37):
quickly?
And go ahead.
SPEAKER_01 (17:39):
Yeah, so we're reviewing claims and the claims
come in the context of ads, buteven if an ad comes down, our
analysis applies to the claim.
So if the same claim appears,even in a different form, new
media campaign, new month, thatclaim will be the subject of our
(18:04):
decision.
SPEAKER_00 (18:06):
Can and can a company, for example, a
pharmaceutical company, go tocourt with this and go, hey FDA,
and you guys might refer them.
Would the FDA use this as thebasis of misbranding or not
quite?
SPEAKER_01 (18:20):
So it's possible.
Um we refer so that theregulatory agencies can consider
under their own statutory andregulatory authority whether the
advertising at issue violatesthose laws.
(18:42):
Court now take action under ourauthority on the basis of the
NAD's analysis.
Um I'll give you an example of asomewhat recent case that um
where the NAD's the fact of theNAD's determinations was cited
(19:06):
as a part of a regulatoryauthority's determination to
bring a lawsuit.
Several years ago, we faced uhwe entertained a challenge
involving JBS, the major meatprocessor.
Um, and we determined that theirclaims relating to um net zero
(19:34):
achievement, and I believe thatthe claim was net zero by 2040,
that the company did not have asubstantial basis for making
those claims and an actionableplan to get there.
Now, subsequently, the New YorkAttorney General brought suit
against JBS.
(19:56):
And um the NAD's action wasraised in the recitation of
facts um in the complaint.
So not the causes of actionsection, but in the factual part
of um of the complaint, and sothat is an example of where our
(20:21):
action has led to formalenforcement action.
SPEAKER_00 (20:27):
Follow our page on LinkedIn.
I I first of all I agree withyou, but I'm actually thinking
about two scenarios.
So the first one is I think youguys actually had NED had a
settlement involving a pharma,two pharma companies were
battling over the same claim.
Uh, I forget which whichcompanies they were.
(20:47):
Um, but it was interestingbecause I think you guys came
out and said, in one version,the the consumer version is not
okay, but the HCP version is.
But the interesting part was theFDA then root came out and said,
we don't find either of these tobe acceptable, and we're gonna
um we're going to do it again.
I I wonder if that was part ofthe basis, saying we can't
(21:07):
depend on the NAD, but this isour independent assessment.
SPEAKER_01 (21:10):
So so that can happen as well.
There is an independent analysisthat occurs.
Um, we do try to conform.
The application of the laws isnot because it's NAD created.
I mean, if there is regulatoryguidance, if there is a
regulation that applies, we willborrow from that to our
(21:34):
analysis.
Do they always align?
It's it's possible that theydon't, um, or that one or the
other of us um is viewed as moreor less lenient in the
particular context.
SPEAKER_00 (21:50):
As usual, Philosophers, we'd love to have
you back again.
And this was amazing.
Uh, how can people reach you orthe NAD if you have questions?
And we'll put that in the shownotes as well.
SPEAKER_01 (21:58):
Sure.
Well, um My email is uh pmarcusat bbbbnp.org.
Um, we have a wonderfullyaccessible website, um,
bbbnp.org, I believe, is ourwebsite.
Um, you will find a host ofinformation, both about the
(22:19):
national advertising division,but about all of the
self-regulatory programs that weadminister at the organization.
Um, there's links to ourprocedures.
You can find our press releases,our annual report, and if you're
if you're so inclined and you'reready, um, there is a link to
(22:39):
how to file a challenge beforeus.
SPEAKER_00 (22:43):
Well, thank you so much for coming on.
This was an absolute pleasure.
And I'm sure we'll see you againsoon.
SPEAKER_01 (22:49):
Sounds good.
SPEAKER_00 (22:52):
Called, click or email.
Welcome back to the KLF Deep Dive.
I'm here with Phyllis Marcus.
You've seen her before.
She was on here with us, I wantto say a couple of weeks ago,
and she was kind enough to talkto us about her perspective from
the NAD.
She works with the NAD, she doesnot necessarily represent the
NAD.
I just want to be clear aboutthat.
Not neither of us is givinglegal advice.
However, this is supposed to beeducational.
(00:20):
Phyllis, tell us a little bitabout you.
SPEAKER_01 (00:22):
Well, um, I am the vice president of the National
Advertising Division at BBBNational Program.
So I do work directly with theNAD, but you're right, Darshan,
that today the views that youand I will be expressing are our
own because I'm sure we'll godown certain paths, um, surmise
(00:43):
certain things, and kind ofunpack other things.
Um, I previously was a law firmpartner for a decade, and before
that, I spent almost two decadesat the Federal Trade Commission
doing consumer protection,enforcement, and regulatory
work.
SPEAKER_00 (00:58):
Let me ask you a really simple question because
you use the word consumer, whichis very interesting to me.
Because do you see from yourperspective, from the vantage
point of being at the NAD, thatthe FDA and the FTC are looking
at the needs of consumers?
And the word consumer implies asort of um end user who decides
what product they buy.
(01:20):
So is it still consumer or isthere a different balance you
look at?
How does that kind of, from yourvantage point, how does that
make sense?
SPEAKER_01 (01:26):
So I I can answer this question in two ways.
SPEAKER_00 (01:29):
Okay.
SPEAKER_01 (01:30):
Um, who is a consumer is not solely um the
end lay person on the street.
And we at the NAD have a numberof cases where we look at the
relevant consuming audience, andhealthcare practitioners can be
(01:50):
one of the relevant consumingaudiences.
In addition, based on neweradvertising techniques, and soon
enough we're not even going tobe able to say that digital
advertising is so new, but umwith the proliferation of
digital advertising, layconsumers are likely to see
(02:12):
advertising messages, even ifthe original intended audience
was a set of professionals.
So when companies put messagingon their websites, for example,
or use social media todisseminate messages, the
broader consuming public isingesting that information.
(02:35):
And um, they aren't justcabineting their exposure to the
commercials that people see onTV that are intended, you know,
only for the end user.
So um that is that's a longanswer to the consuming public.
We can protect and look athealthcare professionals as one
(02:59):
consuming public, and we canlook at the broad array of
materials in making ourdeterminations in protecting
regular consumers.
SPEAKER_00 (03:12):
How do you reconcile those two when you're saying as
as as is reality that patientsor lay consumers will access
both?
SPEAKER_01 (03:23):
Well, perhaps one of the links is in looking at what
is then communicated fromhealthcare practitioners down to
the public for whom a particularmedication is being prescribed.
So if the messaging that iscoming from a company is
(03:44):
potentially deceptive ormisleading, and then it is being
passed along to consumers, thatis problematic.
And so we have not shied awayfrom challenges that have been
brought before us where aportion of the advertising
(04:06):
assets are directed tohealthcare practitioners.
I'll give you an example.
We had a pair of cases,challenges brought by Sanafi
against Galderma for Galderma'smarketing of an eczema drug
called nemluvia.
(04:26):
And the two cases involvedslightly different claims and
different mechanisms ofadvertising.
So the first case, which I'llcall nemluvia one, involved
website advertising, direct topublic, and um assets directed
(04:47):
to healthcare practitioners.
We did not say that thehealthcare practitioner
advertising was off limits forour consideration.
And I apologize if you guys seemy camera moving up.
I'm putting it back down.
Now, the second case, Nemluvio2, involved solely a commercial.
(05:08):
And so that was direct toconsumer advertising.
Um, again, same product, sametwo companies bringing the
challenges, differentadvertising media, uh, same
analysis brought by us.
Because to be honest with you,you know, what we're missing in
this discussion is the realityof how communications to
(05:31):
healthcare practitioners um makeit into the marketplace.
They also are available online.
And so how do you mean you cansearch?
There are websites, and um, theyare accessible to the viewing
public as well.
And so um you you're right, weare not parsing these two
things.
This is enjoying our content,we'd love to hear more.
(05:56):
Please like, comment, share, andfind more.
Now, I'll turn the tables on youand ask.
Um, in the FDA context, then,um, how are how is the FDA
viewing those same materials?
SPEAKER_00 (06:14):
So it's not just the FDA, it's also the DOJ, right?
Because uh technically OIG.
But um the FDA will generallycomment on and they'll add uh
discuss claims made indirect-to-patient uh stuff.
They will not typically get intodirect-to physicians as much.
On the other hand, you will seesettlements from OIG that
(06:39):
involve physicians becausephysicians have then taken, have
switched their roles.
So in those cases, the DOJ takesthe position that you weren't
acting as a physician in thatrole, you were acting as a
salesperson who just happened towear a white coat.
Um, so that's how thatdistinction has been parsed.
(06:59):
There are guidances from theFDA, for example, the SIUU
guidance, um, and which is thescientific exchange guidance,
and then there's the one calledthe CFL or the consistent of the
label guidance, which do getinto it.
There's a whole bunch ofdiscussion about whether that
applies in the context of actualHCP communications, because the
(07:20):
question is can the governmentregulate that in the same way?
Because that goes into, again,First Amendment discussions.
So I might argue that that isstill a sales discussion and how
to do it properly because theFDA has lost a bunch of court
cases starting from about 2012on the regulation of this type
of discussion.
So it's a it's a veryinteresting, nuanced argument.
(07:43):
And I think a lot of people, andI know practitioners who
disagree on exactly this point.
SPEAKER_01 (07:49):
So and I will I will I will tell you, um, our role is
different.
We are not a government entity,we are an independent,
not-for-profit, self-regulatoryorganization.
And so some of those constraintsthat you're describing do not
apply.
SPEAKER_00 (08:09):
Let me ask you this.
So when you're in a positionwhere you are helping guide
companies who are saying, youknow what, no, no, this is HCP
versus non-HCP, how do you beginto explain to companies that I
don't care?
Uh it's this, it's a differentaudience.
We're not uh an agency.
SPEAKER_01 (08:31):
So um, so we are not uh a guidance offering body.
Um, we are uh adjudicators,essentially, of disputes between
companies.
And so um part of the answer isan easy answer.
I'm not developing guidanceexcept in the context of the
(08:52):
cases that we issue and thedecisions that we draft.
And so from the viewing publicthat is familiar with the body
of cases that we've issued atthe NAD, um a discerning reader
will see that certain of ourcases will involve um uh
(09:14):
advertising statements made tohealthcare practitioners.
Um, parties do have an abilityto make jurisdictional arguments
before us, but our criteria isthat the the claim or claims
have to be national in natureand advertising in nature.
And so if they pass muster, theyare both national and they are
(09:37):
advertising, we will reviewthem.
SPEAKER_00 (09:41):
But but what constitutes advertising in that
situation?
SPEAKER_01 (09:44):
Well, I'm not um because you and I are talking,
I'm not gonna pull up thedocument right now, but we do we
do have a uh a definition of ofwhat is advertising.
And so um, you know, I'm not inprivate practice any longer.
If I were, those questions umwould be brought to me by
clients and uh and we would talkthrough them.
(10:06):
But we're serving a differentrole at the NAD, and um, and I'm
thankful then that I don't haveto answer some of these
questions that you're bringing.
SPEAKER_00 (10:15):
Fair enough.
I eat need to go subscribe tothe NAD database, find out a
little bit more.
SPEAKER_01 (10:20):
And and you know, for for those listeners, um, and
I may have said this in our lastdiscussion, but it can't be said
enough.
If you want to understand whatis happening in the world of
advertising, subscribe to ourpress releases.
And if you've got um the meansto do it, I would say um become
(10:42):
a paying subscriber to ouronline archive.
It is a treasure trove goingback decades of our written
decisions.
Um there are easy ways to searchand find those decisions, and
you can see really in-depthanalysis about um how we make
(11:04):
our recommendations anddeterminations.
So that's my plug.
SPEAKER_00 (11:07):
Now, let me ask you a burgeoning area that people
are playing around with andthey're trying to understand how
to analyze this.
The standards that the FDA usesfor a compounding pharmacy, and
one might argue they don't havethe same jurisdiction because
the FTC does, not the FDA,because of the whole
(11:28):
prescription thing.
Um, is that different?
And what is the FTC'sjurisdiction?
Because we all know about thatin our company memo, which
outlined their jurisdiction.
SPEAKER_01 (11:42):
The the agreement that you're talking about is
from the 1970s, if I'm notmistaken.
That's why.
Um and it's memorandum ofunderstanding between the FDA
and the FTC, and it's long beenin place.
And the FTC has other MOUs withother agencies where there's
overlap.
And so um, the two agencies kindof divided up the world at the
(12:04):
time, and the FTC took umover-the-counter labeling and
advertising, and the FDA tookprescription drug labeling and
advertising, and I believe thatsplit remains.
Now, when the NAD gets involved,and we we have gotten involved
(12:29):
in prescription drugadvertising.
Um, so our jurisdiction isdifferent than the FTC's
jurisdiction.
We're not an agency, we're anorganization and
non-governmental at that.
SPEAKER_00 (12:43):
So, what does the word discontinue claims mean in
this case?
SPEAKER_01 (12:48):
So we expect permanent discontinuance of the
claims that were in thechallenge.
And so um it sounds kind offormulaic and rigid, but um, the
challenger submits a complaintto us.
We don't go out and find otherpotentially problematic claims.
So it is up to the challenger toidentify the claims that they
(13:12):
want us to review.
The target of the um challengehas the option of saying, we're
looking at these claims and weare going to permanently
discontinue them.
A party can agree to adhere toour recommendation, which is
keep the claim in themarketplace because you've
(13:32):
substantiated it, modify theclaim in some way because we
think it can be modified, ordiscontinue the claim because it
cannot be made without it, itcannot be made in a truthful and
non-deceptive manner.
So it's these claims, thisrecommendation, and we match
them up.
We don't have any more expansivepower to say and don't uh make
(13:58):
any health-related claims in themarketplace or don't make any um
other claims relating to thisproduct and its efficacy.
We just look at what was broughtbefore us in the complaint and
judge those claims.
SPEAKER_00 (14:13):
So interesting to me because there I'm thinking of
like 15.
I've been writing notes down asyou can tell, and I have like a
bunch of questions.
But at the end of it, is therelike a settlement agreement or a
order or how how do you put downthe five agreements?
SPEAKER_01 (14:28):
You know, now we get technical.
Um, for those of you who want togo access our online archive as
subscribers, you'll see this.
I mean, we have a format inwhich we write our decisions, we
set forth who the parties are,we describe what the claims are
that have been identified thatare the subject of the
challenge, and we go item byitem or uh bucket by bucket and
(14:51):
we analyze them based on thesubstantiation and the arguments
that the advertiser haspresented to us and whether
there are any counterargumentspresented by the challenger.
So in each section of ourdecision, we will make a
recommendation as to that bucketof claims.
(15:11):
And as I said, it's either thatwe found that those claims can
be substantiated and they shouldremain, or the claims need to be
modified or discontinued.
At the end of our decision, wesummarize all of those
recommendations.
So if you were only reading onepart of the decision, you know,
rip off the conclusion and takethat as your guide sheet.
(15:34):
Now, advertisers have theopportunity to submit, and it is
part of the written decision,what we call an advertiser's
statement.
So in that advertiser statement,um, the advertiser is required
to say right off the bat, at thebeginning of that advertiser
(15:56):
statement, they may say, whilewe heartily disagree, we will
comply.
Um, or uh we can't live withthis, and therefore we will not
comply.
So we require the advertiser tostate right uh at the outset
what they're going to do withour recommendations.
(16:17):
We then say, as a result of theadvertiser's decision not to
comply, we will be referringthis case to the appropriate
regulatory or oversightagencies.
And in the case of digitalmedia, we also refer to the
platforms on which theadvertising has appeared.
(16:38):
So there's not a settlementagreement per se, but the
advertiser is required to statewhether they will adhere to our
recommendations or not.
Now, these um the NAD decisionson our recommendations are not
enforceable by law.
They don't carry the same powerthat uh, for example, an
(17:00):
agreement of voluntarycompliance might, um, or a
consent order or decree comingout of one of the agencies.
Again, we're an independent,not-for-profit, voluntary,
self-regulatory organization.
SPEAKER_00 (17:16):
A campaign can be two months long and then they're
moving and shifting, and someonecomes in and says, discontinue.
We were that was three claims,that was three ads ago or three
program, three programs ago.
How does the NAD combat thisissue of they're just moving too
(17:37):
quickly?
And go ahead.
SPEAKER_01 (17:39):
Yeah, so we're reviewing claims and the claims
come in the context of ads, buteven if an ad comes down, our
analysis applies to the claim.
So if the same claim appears,even in a different form, new
media campaign, new month, thatclaim will be the subject of our
(18:04):
decision.
SPEAKER_00 (18:06):
Can and can a company, for example, a
pharmaceutical company, go tocourt with this and go, hey FDA,
and you guys might refer them.
Would the FDA use this as thebasis of misbranding or not
quite?
SPEAKER_01 (18:20):
So it's possible.
Um we refer so that theregulatory agencies can consider
under their own statutory andregulatory authority whether the
advertising at issue violatesthose laws.
(18:42):
Court now take action under ourauthority on the basis of the
NAD's analysis.
Um I'll give you an example of asomewhat recent case that um
where the NAD's the fact of theNAD's determinations was cited
(19:06):
as a part of a regulatoryauthority's determination to
bring a lawsuit.
Several years ago, we faced uhwe entertained a challenge
involving JBS, the major meatprocessor.
Um, and we determined that theirclaims relating to um net zero
(19:34):
achievement, and I believe thatthe claim was net zero by 2040,
that the company did not have asubstantial basis for making
those claims and an actionableplan to get there.
Now, subsequently, the New YorkAttorney General brought suit
against JBS.
(19:56):
And um the NAD's action wasraised in the recitation of
facts um in the complaint.
So not the causes of actionsection, but in the factual part
of um of the complaint, and sothat is an example of where our
(20:21):
action has led to formalenforcement action.
SPEAKER_00 (20:27):
Follow our page on LinkedIn.
I I first of all I agree withyou, but I'm actually thinking
about two scenarios.
So the first one is I think youguys actually had NED had a
settlement involving a pharma,two pharma companies were
battling over the same claim.
Uh, I forget which whichcompanies they were.
(20:47):
Um, but it was interestingbecause I think you guys came
out and said, in one version,the the consumer version is not
okay, but the HCP version is.
But the interesting part was theFDA then root came out and said,
we don't find either of these tobe acceptable, and we're gonna
um we're going to do it again.
I I wonder if that was part ofthe basis, saying we can't
(21:07):
depend on the NAD, but this isour independent assessment.
SPEAKER_01 (21:10):
So so that can happen as well.
There is an independent analysisthat occurs.
Um, we do try to conform.
The application of the laws isnot because it's NAD created.
I mean, if there is regulatoryguidance, if there is a
regulation that applies, we willborrow from that to our
(21:34):
analysis.
Do they always align?
It's it's possible that theydon't, um, or that one or the
other of us um is viewed as moreor less lenient in the
particular context.
SPEAKER_00 (21:50):
As usual, Philosophers, we'd love to have
you back again.
And this was amazing.
Uh, how can people reach you orthe NAD if you have questions?
And we'll put that in the shownotes as well.
SPEAKER_01 (21:58):
Sure.
Well, um My email is uh pmarcusat bbbbnp.org.
Um, we have a wonderfullyaccessible website, um,
bbbnp.org, I believe, is ourwebsite.
Um, you will find a host ofinformation, both about the
(22:19):
national advertising division,but about all of the
self-regulatory programs that weadminister at the organization.
Um, there's links to ourprocedures.
You can find our press releases,our annual report, and if you're
if you're so inclined and you'reready, um, there is a link to
(22:39):
how to file a challenge beforeus.
SPEAKER_00 (22:43):
Well, thank you so much for coming on.
This was an absolute pleasure.
And I'm sure we'll see you againsoon.
SPEAKER_01 (22:49):
Sounds good.
SPEAKER_00 (22:52):
Called, click or email.
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