In this global economy, where many goods can be manufactured more easily and cheaply in foreign countries, American shoppers like to express their economic patriotism and seek out products that claim to be “Made in the USA”. This is especially true for medicines and dietary supplements that have the potential for harm if not produced in accordance with the FDA’s Good Manufacturing Practice regulations and other applicable safety standards that may not be as widely known or strictly enforced in foreign facilities.
In addition, manufacturers and distributors are eager to promote their products this way as a strategy to increase their market share and make them stand out from others that are unable to make this claim.
But whether you are a consumer or a manufacturer, you should understand what the claim actually means.
The regulatory agency tasked with overseeing “Made in the USA” claims is the Federal Trade Commission (FTC) whose mission is, among others, to prevent deception and unfair practices in the marketplace. For pharmaceutical and dietary supplement products to incorporate such a claim, they may only do so if “all, or virtually all” of the product is made in the USA.
What is meant by “all, or virtually all”? According to the FTC, this means that all significant parts and processing that go into a product must be of US origin. In other words, the product should contain no, or negligible, foreign content. In making this determination, the FTC considers several factors:
- The final assembly or processing of the product must take place in the United States
- The percentage of the product’s total manufacturing costs that can be assigned to US parts and processing
- How far removed any foreign content is from the finished product (how far back in the manufacturing process was the foreign content used)
In other words, manufacturers need to consider the origin of the raw materials (ingredients) present in the product as well as the cost of labor involved in production, a very high standard to meet.
In addition to an express claim of “Made in the USA”, manufacturers need to be cautious in their use of implied claims, such as a graphic of the American flag, on their labeling or in their advertising. The FTC will examine such representations in the overall context in which they are used to determine if there has been a violation.
Should a manufacturer believe that its product actually does meet the requirements defined above, it should ensure that it has reliable and substantiated evidence to support the claim.