Metagenics, Inc.; Jeffrey Katke; Analysis to Aid Public Comment

FEDERAL TRADE COMMISSION

[File No. D09267]

Metagenics, Inc.; Jeffrey Katke; Analysis to Aid Public Comment

AGENCY: Federal Trade Commission.

ACTION: Proposed consent agreement.

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SUMMARY: The consent agreement in this matter settles alleged

violations of federal law prohibiting unfair or deceptive acts or

practices or unfair or deceptive acts or practices or unfair methods of

competition. The attached Analysis to Aid Public Comment describes both

the allegations in the draft complaint that accompanies the consent

agreement and the terms of the consent order--embodied in the consent

agreement--that would settle these allegations.

DATES: Comments must be received on or before June 30, 1997.

ADDRESSES: Comments should be directed to: FTC/Office of the Secretary,

Room 159, 6th St. and Pa. Ave., NW., Washington, DC 20580.

FOR FURTHER INFORMATION CONTACT:

Lesley Ann Fair, Federal Trade Commission, S-4002, 6th St. and Pa.

Ave., NW., Washington, DC 20580. (202) 326-3081.

SUPPLEMENTARY INFORMATION: Pursuant to Section 6(f) of the Federal

Trade Commission Act, 38 Stat. 721, 15 USC 46, and Section 3.25 of the

Commission's Rules of Practice (16 CFR 3.25), notice is hereby given

that the above-captioned consent agreement containing a consent order

to cease and desist, having been filed with and accepted, subject to

final approval, by the Commission, has been placed on the public record

for a period of sixty (60) days. The following Analysis to Aid Public

Comment describes the terms of the consent agreement, and the

allegations in the accompanying complaint. An electronic copy of the

full text of the consent agreement package can be obtained from the

Commission Actions section of the FTC Home Page (for April 22, 1997),

on the World Wide Web, at ``http://www.ftc.gov/os/actions/htm.'' A

paper copy can be obtained from the FTC Public Reference Room, Room H-

130, Sixth Street and Pennsylvania Avenue, NW., Washington, DC 20580,

either in person or by calling (202) 326-3627. Public comment is

invited. Such comments or views will be considered by the Commission

and will be available for inspection and copying at its principal

office in accordance with Section 4.9(b)(6)(ii) of the Commission's

Rules of Practice (16 CFR 4.9(b)(6)(ii)).

Analysis of Proposed Consent Order to Aid Public Comment

The Federal Trade Commission has accepted, subject to final

approval, an agreement to a proposed consent order from Metagenices,

Inc. and its officer and director, Jeffrey Katke.

The proposed consent order has been placed on the public record for

sixty (60) days for reception of comments by interested persons.

Comments received during this period will become part of the public

record. After sixty (60) days, the Commission will again review the

agreement and the comments received and will decide whether it should

withdraw from the agreement or make final the agreement's proposed

order.

On August 16, 1994, the Commission issued a complaint against

respondents, alleging that they made deceptive claims in advertisements

for Bone Builder, a calcium supplement. After an administrative trial,

the Administrative Law Judge issued an Initial Decision on October 22,

1996, from which both complaint counsel and respondents filed notices

of appeal. On January 7, 1997, the Commission granted a Joint Motion to

Withdraw from Adjudication to consider the proposed consent agreement

in this case.

The Commission has issued an amended complaint, clarifying some of

the allegations in the August 16, 1994, complaint. The amended

complaint alleges that respondents represented without substantiation

that post-menopausal women who have already lost bone and who use Bone

Builder will experience no additional bone loss and will achieve a

growth of new bone greater than the amount of bone lost; that users of

Bone Builder will not experience bone loss or osteoporosis; that Bone

Builder restores bone strength; that Bone Builder reduces or eliminates

pain associated with bone ailments; and that Bone Builder is more

bioavailable, more absorbable, or more effectively utilized by the body

than other forms of calcium or is more effective than other forms of

calcium in the prevention or treatment of bone ailments. The amended

complaint also states that respondents relied upon a reasonable basis

to substantiate that adequate calcium intake has many benefits and is

one of the essential factors in the body's ongoing process of removal

of old bone and replacement by new bone; in conjunction with other

factors, adequate calcium intake can play a significant role in

reducing the rate of bone loss or bone thinning and in protecting bone

strength; and individuals who do not consume adequate calcium are at

greater risk of experiencing bone fractures than those who do.

The proposed consent order contains provisions designed to remedy

the violations charged and to prevent respondents from engaging in

similar acts and practices in the future. In advertising or selling any

food, drug, or supplement, Part I of the order requires respondents to

rely on competent and reliable scientific evidence to support any claim

that post-menopausal women who have lost bone and who use the product

will experience no additional bone loss or will achieve a growth of new

bone greater than the amount of bone loss or that users of the product

will not experience bone loss. Part I requires the same level of

substantiation

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for any claim that a food, drug, or supplement restores bone strength,

reduces or eliminates pain associated with bone ailments, or is

superior to any other form of calcium in bioavailability,

absorbability, utilization by the body, or treatment or prevention of

bone ailments.

In advertising or selling any food drug, or supplement, Part II

forbids respondents from misrepresenting the existence, contents,

validity, results, conclusions or interpretations of any test or study.

In making claims regarding the relationship between calcium and

osteoporosis, Part III requires respondents to limit themselves to the

health claims authorized by the Food and Drug Administration, as set

forth in 58 FR 2665 (1993), or to have competent and reliable

scientific evidence to support the claims.

Part IV requires respondents to possess competent and reliable

scientific evidence to support health-related claims for products

containing calcium, and to have scientific substantiation for health-

related superiority claims for any food, drug, or supplement.

Part V allow respondents to make representations that are

specifically permitted by FDA regulations promulgated pursuant to the

Nutrition Labeling and Education Act of 1990. Part VI allows

respondents to make any claim for a drug that is permitted in labeling

for that drug under any tentative or final FDA standard or under any

FDA-approved new drug application.

Parts VII through X relate to respondents' obligations to make

available to the Commission materials substantiating claims covered by

the order; to notify the Commission of changes in Metagenics's

corporate structure; to notify the Commission of changes in Mr. Katke's

employment or business affiliations; and to provide copies of the

orders to certain Metagenics personnel. Part XI provides that the order

will terminate after twenty years under certain circumstances. Part XII

requires respondents to file periodic compliance reports with the

Commission.

The purpose of this analysis is to facilitate public comment on the

proposed order, and it is not intended to constitute an official

interpretation of the agreement and proposed order or to modify in any

way their terms.

Donald S. Clark,

Secretary.

[FR Doc. 97-10971 Filed 4-28-97; 8:45 am]

BILLING CODE 6750-01-M