Zenith Laboratories, Inc

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IN Tile MATTER OF ZENITH LABORATORIES, INC., ET AL.

Docket 8426. Order, June, 1.97.'j Show cause order of July 24, 1973, proposing modification of the order to cease and desist vacated.

Appearances For the Commission: J. Than,s Rosch. For the respondents: Damd R.Sirnon, Simon Allen Newark, N.J. ORDER VACATING ORDER PROPOSING MODIFICATION OF ORDER TO CEASE AND DESIST On Apr. 1: , 1973, respondent Zenith Laboratories, Inc. (Zenith), petitioned the Commission to reopen the consent order, dated Mar. 30 1962, for the purse of modifying said order by setting a"ide the order in its entirety. The 1962 consent order requires respondent to cease and desist from:

1. Disseminating or causing to be disseminated any advertisement by means of the United States mails or by any means in commerce, as commerce" is defined in the Federal Trade Commission Act, which advertisement:

(a) Uses the terms "quality control" or "exacting controls " or any other words or terms of similar import or meaning; or (b) Represents, directly or indirectly:

(1) That respondents have an adequate control system, or misrepresents the nature or extent of the procedures used by them in the manufacture, preparation or distribution of drugs or foo. The Commission concluded that goo cause had been shown for modifying the above provisions of the order, but not as respondent requested, and so, by order of July 24, 197:, reopened this proceeding .. .

LJ"J.J.U J.'J.H'-J. .L'-.L'J. , J." 946 Order and ordered respondent Zenith to show cause why the order should not be modifed by requiring respondent Zenith to cea.,e and desist from: 1. Disseminating or causing to be disseminated any advertisement by means of the United States mails or by any means in commerce, as c9mmerc " is defined in the Federal Trade Commission Acl, whichadvertisement:(a) Uses the terms "quality control" or "exacting controls " or any other words or terms of similar import or meaning; unless respondents also state in the same advertisement that such controls are required of all drug manufacturers pursuant to the standards set by the Federal Food, Drug, and Cosmetic Act, as amended; Provided, however That such controls are in fact in conformance with the standards set by the Federal Food, Drug, and Cosmetic Act, as amended. (b) Represents, directly or indiectly:

(1) That respondents have a more exacting quality control system than prescribed by the Fedeml Food, Drug, and Cosmetic Act, as amended, or misrepresents the nature or extent of the procedures used by them in the manufacture, preparation or distribution of drugs or food, Paragraph lea) Zenith, in its answer dated Aug. 24, 1973, requested that the Commission modify the consent order to permt it to use the term quality control" and "exacting controls" in its advertisements, without the proposed qualifying language (i.e. that such controls are required of a1l drug manufacturers puruant to the standards set by the Federa Food, Drug and Cosmetic Act, as amended"). The grounds of Zenith' objections were that (1) the qualifying language could be read to imply that FDA approved of the company's qualty controls, when a FDA reguation specifca1ly prohibits a party from advertising that it has a new drug application approved by FDA; (2) it would be impmctical for Zenith to include such wording; and (3) no other company is required to make the subject disclosure.

The Food and Drug Admistration, by letter dated Nov. 16, 1973 similarly recommended against requing the qualifying language, as " appear * * * that this would be inequitable unless it were enforced against all manufacturers " and, in addition, might give rise to the possible implications that the Foo and Drug Admistrdtion has approved the company s quality control standards when, in fact, that is not the situation.

Counsel supporting the complaint concur in these recommendations that the 1962 order not be modifed a., proposed by Pardgraph l(a). We agree.

Pararaph l(b)(1) , 94H FEDEKAL TRADE COMMISSION DECISIONS Order 85 F.

No objection to this modifcation was made by either FDA or respondents. We agree, however, with counsel supporting the com- , plairil;that the subject modification should be rejected, Representations as to "quality control" or "exacting controls" (representations which would be permssible under the modification) "should be permitted," counsel supporting the complaint point out l only 1 when respondent' controls significantly exceed the minium requirements of the law " It is our opinion that many consumers tend to believe that firm in their manufacturng processes comply with the standards set by law and, as a consequence, the use of such terms as "quality control" may well create the impression that the standards employed by the manufacturer exceeds those set by law. It follows, then, that since the that quality subject provision is intended to prohibit representations controls exceed those prescribed by FDA, representations as to quality controls" or "exacting controls" should be proscribed. Accordingly, It 'is ordered That the Commssion s show cause order of .July 24 19n proposing modification of the order to cease and desist issued in this matter on Mar. : , 1962, be, and it hereby is, vacated.