The bill, which was put forth in the Senate chamber of the commonwealth’s legislature, would have amended the Puerto Rico Pharmacy Law, defining natural products and dietary supplements. The bill would have formalized Puerto Rico Department of Health (PRDH) Administrative Order 346, which took effect earlier this year.
The executive order itself came as something of a surprise. It was instituted in early February without notice and without a comment period by Puerto Rico Secretary of Health Ana Riuz Almendáriz. The order sets new requirements that were characterized by both the Natural Products Association and the Council for Responsible Nutrition as costly and onerous. Among them are:
- A new regulatory scheme in Puerto Rico for all distributors of dietary supplements. It requires a burdensome product-by-product registration per store requiring $25 fee for every variation of a supplement by size, color, SKU.
- A requirement for all manufacturers of dietary supplements seeking to sell their products in the commonwealth to pay an additional $500 fee. Distributors must also register and pay an additional $100 fee.
‘Money grab’
Natural Products Association executive director and CEO Dan Fabricant, PhD said a grassroots effort put together by his organization—which includes many medium and small-sized retailers who likely would be most sensitive to the order’s provisions—had an effect on the outcome of the bill, which has been shelved for this legislative session.
“Overnight we got 1,400 e-mails sent out on this issue,” Fabricant told NutraIngredients-USA. Fabricant characterized the secretary’s order as a blatant “money grab” in an effort to refill government coffers drained by the commonwealth’s current financial crisis. Puerto Rico is $70 billion in debt from years of issuing bonds to maintain services and government job rolls during a period of declining tax revenues and is days away from potentially defaulting on a $2 billion debt payment. Fabricant said unraveling policies such as the one put into place by Almendáriz ought to form part of the debt relief negotiations. A bailout package is currently before the US Congress.
“If Puerto Rico is going to get funding for their bailout then we can’t in turn have bad policies that were instituted during a time of crisis allowed to hang around,” he said.
Issue with bad actors
Mike Greene, senior vice president of government relations for CRN, said his organization has been trying to understand the underlying motivation for the original order as a way to try to allay those concerns as step toward getting it rescinded. While the Senate bill that would have firmed up the order has been defeated, the order itself remains in effect. Greene said the motivation has something to do with the unique nature of the Puerto Rican market. FDA has in the past raised warning flags about the higher prevalence of tainted products that are marketed in stores that cater to certain ethnic groups, and Greene said this has been an issue in Puerto Rico.
“They were trying to address concerns they have in Puerto Rico, concerns with egregious actors who are marketing products there quite prolifically,” Greene said.
Greene said the individual nature of the Puerto Rican market led CRN to adopt a different approach than the e-mail blitz and pressure brought to bear in Washington that marked NPA’s campaign.
“We felt is was necessary to address this at a commonwealth level. We retained a lobbying firm to address the language barrier as well as the cultural barrier. Puerto Rico has its own unique issues to deal with because of its being a commonwealth and not a state,” he said.
“We are going to try to meet with the Secretary of Health to try to understand why she did what she did. The administrative order is in effect until the governor vetoes it. Legal action to challenge the order might be an option at some point,” Greene said.