UNITED STATES OF AMERICA
FEDERAL TRADE COMMISSION
WASHINGTON, D.C. 20580
Division of Enforcement
Bureau of Consumer Protection
Elaine D. Kolish
Associate Director
October 2, 2002
Everett L. Farr III, President
Panda Herbal International, Inc.
744 Walnut Avenue
Building 2
Bensalem, PA 19020
Re: Panda Herbal International, Inc., and Everett L. Farr III
FTC Docket No. C-4018
Dear Mr. Farr:
The Division of Enforcement staff has reviewed your submissions dated August 15, 2001, October 6, 2001, and February 4, 2002, which you have filed to show the manner and form of respondents' compliance with the order referenced above, which was issued on July 30, 2001. You also submitted additional materials in response to our investigation involving the respondents' possible violations of the order.
The staff has determined that the versions of the website and the promotional brochures, submitted to the staff prior to June 6, 2002 violate the above-referenced order by:
(1) Representing that Herbal Outlook products, Independence 1-Step, and Herbal Phen-Fen have no known contraindications or drug interactions, in violation of Part III.
(2) Failing to clearly and conspicuously make the required disclosure about St. John's Wort in advertising and labeling for Herbal Outlook, Independence 1-Step, and Herbal Phen-Fen, in violation of Part IV.
(3) Representing that the St. John's Wort products, Herbal Outlook, Independence 1-Step, and Herbal Phen-Fen, have "also been reported to have anti-viral activity against herpes simplex virus, influenza virus and hepatitis B virus," in violation of Part I.
(4) Representing that HerbVeil 8, HerbVeil 8 Escharotic Salve, HerbVeil Healing Creme, HerbVeil Internal, HerbVeil Internal Tonic, HerbVeil External Body Lotion, and HerbVeil Facial Lotion have "anti-tumor properties" or are effective in the treatment of cancer, in violation of Part II.
(5) Representing that Independence 1-Step and the Independence Stop Smoking Support Program have ingredients that have been proven to curb the desire for tobacco, in violation of Part V.
(6) Representing that Herbal Phen-Fen helps one to lose body weight safely and effectively, in violation of Part V.
(7) Representing that Herb Relief Muscle-Joint Cartilage Support and Herbal Balance Osteoarthritis Remedy assist the body in repairing cartilage tissue, in violation of Part V.
Accordingly, staff has rejected Attachments A through X of the compliance report.
Respondents have told the staff that they have stopped disseminating all the above claims and in the future will make all required disclosures in a clear and conspicuous manner. The staff understands that these claims will no longer be made and are currently not being made on Panda Herbal's website, or in its brochures.
Panda Herbal must bear in mind that the order requires it to have competent and reliable scientific evidence substantiating health claims for covered products and services. Before disseminating future health claims for covered products or services, you should ensure that you have adequate substantiation for the claims.
The staff has concluded, on the assumption that the information submitted is accurate and complete, that no compliance action is indicated at this time. We will not be precluded, however, from recommending to the Commission an appropriate action if the submitted information is inaccurate or incomplete or if the respondents violate the terms of the order. The opinions expressed in this letter are those of the staff and not necessarily those of the Commission or of any Commissioner.
Sincerely,
Elaine D. Kolish
Associate Director for Enforcement