Steps to reduce the risk of nutraceuticals
Dietary supplements, such as amino acids, vitamins, minerals, and other complementary nutrition products, send approximately 23,000 people in the U.S. to the emergency room each year. A new study published in the New England Journal of Medicine reports that there is legitimate risk associated with taking these supplements.
At the hospitals analyzed in the study, researchers connected 3,667 emergency room visits to supplements. Based on these numbers, the study infers that 23,005 adverse events occur each year across the U.S and adults ages 20 to 34 made up 28 percent of hospitalizations. Weight-loss products were attributed to most emergency room visits per year by women, while visits for men were contributed to body building products or sexual enhancement products.
Due to the amount of risk associated within this industry, supplement companies should review the following points in order to mitigate their losses:
- Implement quality control procedures, and have a course of action in place in the event of a product recall. If there is a plan, make sure that it illustrates that adequate communication to all affected parties is streamlined
- Confirm that contracts clearly outline the responsibilities of each party involved in the manufacturing and distribution process
- Ensure that there is a robust insurance portfolio paying particular attention to the Products Liability program, with a focus on the ingredient exclusions, and carve back coverage as applicable
- Maintain a real time representation of the supply chain, and understand what each party’s responsibility is in the process
- Evaluate how your company addresses customer grievances, comments, and questions. Additionally, analyze company policies and procedures in order to verify that customers and regulatory authorities are receiving up-to-date and accurate information.
The frequency of news reporting on the risks of dietary supplements appears to be increasing, especially when a celebrity is involved. One such product that has garnered much attention and scrutiny as of late is herbal Viagra. The insurance market has been limited with its offerings for this industry, but programs catered to this exposure do exist. Underwriters are asking more questions with regards to companies’ risk management process. Working with a knowledgeable partner who understands these risks and the market can assist a company with working or improving their existing processes to assist with loss mitigation.
About the Author
Ceiry A. Fox is an Area Vice President at Gallagher WGA and a member of the Property and Casualty Group. Ceiry’s main focus is working with high profile Risk Management clients in the life sciences and technology sector.