Consumer Alert: FTC and FDA Issue Warning Letters to Companies Looking to Capitalize on Coronavirus Fears

Stop sign in forest

The Secretary of Health and Human Services, under section 319 of the Public Health Service Act, 42 U.S.C. § 247d, has determined that a public health emergency exists nationwide as a result of confirmed cases of COVID-19. Unfortunately, it seems that not only must we be vigilant in maintaining our health, but we must also be careful not to let our guards down and be deceived by unscrupulous operators looking to capitalize on the fear and confusion surrounding the Coronavirus. In a move that was exceptional for both its coordination and its swiftness, the Federal Trade Commission and the Food and Drug Administration issued Warning Letters to seven companies selling products that claim to prevent or COVID-19 Coronavirus.

The FDA unequivocally advises that there are no approved vaccines, drugs or investigational products currently available to prevent or treat this virus. As such, the FDA concluded that the challenged products are unapproved drugs that pose significant risks to patient health and violate section 505(a) of the Federal Food, Drug, and Cosmetic Act (FD&C Act), 21 U.S.C. 355(a), are misbranded drugs under section 502 of the FD&C Act, 21 U.S.C. 352, and that introduction or delivery for introduction of these products into interstate commerce is prohibited under section 301(a) and (d) of the FD&C Act, 21 U.S.C. § 331(a) and (d). It is also unlawful under the Federal Trade Commission Act, 15 U.S.C. 41 et seq., to advertise that a product can prevent, treat, or cure human disease unless the advertiser possesses competent and reliable scientific evidence, including, when appropriate, well-controlled human clinical studies, substantiating that the claims are true at the time they are made.

The sellers and their products, which should be avoided, are:

  • Vital Silver – essential oil product offered for sale through company’s website and/or through advertising on Facebook.
  • Quinesssence Aromatherapy Ltd. – essential oil product offered for sale through company’s website and/or through advertising on Twitter.
  • Xephyr, LLC d/b/a N-ergetics – colloidal silver products offered for sale through company’s website.
  • GuruNanda LLC – essential oil product offered for sale through company’s website and/or through advertising on Twitter and Facebook.
  • Vivify Holistic Clinic – tea product offered for sale through company’s website and/or through advertising on Facebook.
  • Herbal Amy LLC – Coronavirus Boneset Tea, Coronavirus Cell Protection, Coronavirus Core tincture, Coronavirus Immune System, and Elderberry Tincture products offered for sale through company’s website and/or through advertising on Facebook.
  • The Jim Bakker Show – products labeled to contain silver, such as “Silver Sol Liquid,” offered for sale through company’s website.

The FDA advises consumers not to purchase or use certain products that have not been approved, cleared, or authorized by FDA and that are being misleadingly represented as safe and/or effective for the treatment or prevention of COVID-19 Coronavirus. Similarly, the FTC has issued a blog post to warn consumers about scams that are being implemented by way of internet, email, text, social media, and direct telephone calls to prey on unsuspecting consumers’ fears about Coronovirus and bilk them of their personal information, money or both. Both the FDA and the FTC have expressly stated that they are prepared to take enforcement actions against any seller who markets such misbranded products, which could include (but are not limited to) injunctive relief, reimbursement of monies paid by consumers, and detention and/or refusal of admission of products to the United States (if the products are being imported).

Published by Bill Acevedo

I am the Chair of Wendel Rosen LLP's Green Business Practice Group, and I am the Co-Chair of my firm's Food and Beverage Group. My practice focuses on manufacturing and food, dietary supplement and cosmetic companies. I provide outside general counsel services to my clients, which include: entity formation, business and legal advice on proposed business transactions, general contract negotiation and drafting, brand and licensing protection, corporate governance, capital raises, and M&A transactions. Additionally, I assist my clients with labeling, advertising, and FDA regulatory compliance matters. In addition to my corporate transactional practice, I handle all manner of business litigation, such as labeling/advertising claims, contractual disputes, trade secret matters, partnership disputes, product liability claims, director and officer liability, and unfair business practices claims.

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