Food and Beverage News and Trends - March 31, 2023

This regular publication by DLA Piper lawyers focuses on helping clients navigate the ever-changing business, legal and regulatory landscape.

Key leader of FDA food programs announces her resignation. On March 27, Susan Mayne, director of the FDA’s Center for Food Safety and Applied Nutrition, announced she is retiring effective May 31. She has led the center for more than eight years; her retirement means there will be simultaneous vacancies in the leadership of both the major FDA divisions that deal with food as former Deputy Commissioner for Food Policy and Response Frank Yiannas resigned in February. FDA observers have noted that Mayne’s retirement occurs at a time when the Human Foods program at the FDA is undergoing a reorganization. As director of the center, Mayne worked to implement the Food Safety Modernization Act, led labeling reforms, and spearheaded the use of new science at the FDA, through actions including standardizing whole-genome sequencing for food safety issues and issuing the first no-questions letters for cultivated meat companies.

FDA issues “no questions” letter regarding cultivated chicken product. On March 20, the FDA issued a “no questions” letter to GOOD Meat, Inc. a unit of Eat Just, Inc., thus granting a tacit approval to its cultivated chicken product – a cell-cultured product that does not involve the slaughter of an actual live fowl – for consumption in the United States. This means that the FDA has accepted the company’s conclusion that its GOOD Meat cultivated chicken is safe to eat. Once the product obtains its second regulatory approval – from USDA, which must approve GOOD Meat’s facilities and inspect the meat it produces – the cultivated chicken will be served at a Washington, DC, restaurant owned and operated by GOOD Meat board member and chef José Andrés. GOOD Meat chicken first garnered a regulatory approval in Singapore in 2020, making GOOD Meat the only company in the world that is legally allowed to sell cultivated meat.

Draft guidance on dietary statements for food labels. On March 24, the FDA issued draft guidance on how and when dietary guidance statements should be used on food labels. The draft guidance aims to ensure that these statements promote good nutrition. Noting that “eating patterns in the US do not align with dietary recommendations,” the FDA said that the goal of the draft guidance is to encourage healthier habits in consumers, enhance consistency in labeling and improve customer understanding of the contents of the foods they eat and of nutrition overall.

CFIA publishes Food Fraud Annual Report (2021 to 2022). The Canadian Food Inspection Agency’s Food Policy for Canada has made food fraud a priority. “Food fraud” occurs when a food is misrepresented as another, usually more expensive, food. Between 2021 and 2022, the CFIA tested 844 samples of products for authenticity and misrepresentation. The sample products included those that have a higher risk of food fraud. From its testing, the CFIA found that the following percentages of analyzed samples were satisfactory: 92.7 percent of fish, 77.5 percent of honey, 99.1 percent of meat, 86.9 percent of olive oil, 64.3 percent of other expensive oils, and 90.8 percent of spices. Where the CFIA found noncompliance with Canada’s food fraud laws, it took action, including detaining, destroying, and relabeling products and removing products from the country. The CFIA also announced new charges and fines that related to food fraud investigations from previous years. Violations include misleading consumers as to the country of origin of a product, falsely labelling hormone-treated meat as “certified organic,” and selling previously frozen products as “fresh.” The CFIA says its plans to use the results of its sampling and testing to inform future efforts to prevent, detect and deter food fraud. It says that such efforts will include improved risk-based program design, surveillance activities, compliance promotion and enhanced enforcement.

Comment period will reopen on draft guidance regarding action plan for lead in baby foods. On March 28, the FDA announced it will reopen the comment period for an additional 30 days regarding its Closer to Zero action plan, which among other things aims to reduce toxic elements, such as lead, in foods manufactured for infants and young children. FDA says it is reopening the comment period in response to calls from industry stakeholders for more time to develop their responses. Download the draft guidance here.

FDA moves to permit salt substitutes in standardized foods. The FDA announced March 24 that it will soon propose amending the existing food standards of identity (SOIs) to permit the use of salt substitutes in foods for which salt is a required or optional ingredient. The proposed rule, the FDA said, would provide manufacturers with flexibility and would facilitate industry innovation to reduce sodium in standardized foods. Currently, 250 SOIs exist for a wide variety of foods such as ketchup, milk, and milk chocolate. Salt substitutes are currently used in many non-standardized foods in the US, but most of the SOIs do not permit the use of salt substitutes. The proposed rule would use a “horizontal” approach for SOIs, under which a single rule would apply to multiple SOIs across several categories of standardized foods. Specifically, the proposed rule would amend the 80 SOIs that specify salt as a required or an optional ingredient. By implication, it would also affect 60 more SOIs that reference these original 80 SOIs.

CFIA publishes Food Fraud Annual Report (2021 to 2022). The Canadian Food Inspection Agency’s Food Policy for Canada has made food fraud a priority. “Food fraud” occurs when a food is misrepresented as another, usually more expensive, food. Between 2021 and 2022, the CFIA tested 844 samples of products for authenticity and misrepresentation. The sample products included those that have a higher risk of food fraud. From its testing, the CFIA found that the following percentages of analyzed samples were satisfactory: 92.7 percent of fish, 77.5 percent of honey, 99.1 percent of meat, 86.9 percent of olive oil, 64.3 percent of other expensive oils, and 90.8 percent of spices. Where the CFIA found noncompliance with Canada’s food fraud laws, it took action, including detaining, destroying, and relabeling products and removing products from the country. The CFIA also announced new charges and fines that related to food fraud investigations from previous years. Violations include misleading consumers as to the country of origin of a product, falsely labelling hormone-treated meat as “certified organic,” and selling previously frozen products as “fresh.” The CFIA says its plans to use the results of its sampling and testing to inform future efforts to prevent, detect and deter food fraud. It says that such efforts will include improved risk-based program design, surveillance activities, compliance promotion and enhanced enforcement.

CFIA issues new licensing and testing requirements for mushrooms, poultry. The CFIA has issued new licensing requirements for enoki mushrooms, which came into force on March 15, and new testing requirement for meat and poultry, which will come into force on April 1.

• Regarding enoki mushrooms licensing, the CFIA is requiring that importers of enoki mushrooms from either the Republic of Korea and the Republic of China hold and test the products for l. monocytogenes, a bacteria which causes listeria. Failure to comply may result in the suspension or cancellation of importers’ Safe Food for Canadians (SFC) license.
• Regarding poultry, the CFIA has made two changes. First, it has updated the Pathogen Reduction Monitoring Program for salmonella and campylobacter for raw poultry. The changes will require operators who produce chicken parts to initiate pathogen reduction monitoring and will impose new conditions for performance monitoring on carcasses or comminuted poultry for operators not producing chicken parts. Second, the CFIA has published the Process Verification Monitoring Program for generic e. coli in raw poultry, which will require SFC license holders who slaughter poultry to update their monitoring procedures for e. coli. The e. coli monitoring program currently only applies to poultry carcasses but may be expanded in the future.

Health Canada updates policy on Listeria in ready-to-eat foods. Health Canada, with input from the CFIA, has announced an updated policy on Listeria monocytogenes in ready-to-eat foods. The update clarifies the application and non-application of the policy to specific businesses and activities and provides clarity on some of the concepts. In an effort to make compliance simpler, additional details were provided to the definition of “ready-to-eat foods” and a decision tree has been added. The last Listeria monocytogenes policy was published in 2011, and the new policy will be effective October 1, 2023.

FDA publishes new ingredient directory for food supplements. On March 6, the FDA published a new “ingredient directory” for producers and consumers of dietary supplements so that they can remain informed about recent developments and locate information quickly on the agency’s website. The FDA said that the directory will include links to the agency’s actions and communications concerning ingredients used in products marketed as dietary supplements. The agency will update the directory periodically to reflect new developments. FDA said that the directory is not intended to be a comprehensive list of all ingredients used in products marketed as dietary supplements and may not include all actions the agency has taken with respect to a particular ingredient.

Pasta trade group proposes helping US government redefine “pasta” for first time in 80 years. At the March 20 annual meeting of the National Pasta Association in Florida, the group’s governmental affairs committee chairman said this is a good time to help the US government revise the standard of identity for pasta, which has not been updated in nearly 80 years. The chairman, Tom Quinn, said, “We thought it was time to look at this and update it for the membership and the benefit of the folks in this industry. There actually was not really a pasta standard of identity (SOI) – it was considered merely a macaroni noodle, because that’s what there was at the time it was written.”

FDA’s FY 2024 budgetary wish list. On March 9, the FDA announced a $7.2 billion budget request for fiscal year 2024. Among the specific requests by the agency were $128.2 million to strengthen consumer protection and implement lasting solutions for more efficient operations through continued investments in the New Era of Smarter Food Safety. It also proposed that it be granted new legislative authorities. These proposals include enhanced authorities related to shortages of drugs, medical devices, and foods, particularly requirements for manufacturers to notify FDA when they will be unable to supply an increase in demand; additional tools to allow FDA to continue certain oversight activities when inspections are not feasible; expanded authorities for information sharing with the states; and additional authorities for destruction of products which present a significant public health concern.

Supplements trade group says it may sue FDA over niacin-like product. On March 14, Dr. Daniel Fabricant, CEO of the Natural Products Association, said that the trade group is hoping that the FDA will soon respond to its current citizen’s petition on the status of nicotinamide mononucleotide (NMN) but that if the FDA does not act, it is considering suing the agency. In November 2022, the FDA said that NMN will not be allowed as a dietary ingredient because of its prior investigation as a drug. NMN is a form of niacin that has been shown to enhance the levels of nicotinamide adenine dinucleotide in the cells of the human body, in turn possibly showing significant benefits in staving off cellular aging. The trade association wants the FDA to reevaluate the status of NMN or to exercise enforcement discretion on the product.

New bill would reverse FDA’s ruling on plant-based milks. A proposed bipartisan bill in the US Congress would invalidate the Food and Drug Administration’s current guidance on the correct labeling of plant-based milk alternatives such as soy milk or almond milk. The so-called DAIRY PRIDE Act would prohibit manufacturers of products made from nuts, seeds, and other vegetable sources from using terms such as “milk,” “yogurt,” and “cheese” to name their products. On February 23, the FDA had said that it was permissible for such companies to use the term “milk,” as long as it was modified in the use of a name like “soy milk.” On March 14, Representative Elise Stefanik, a Republican from New York, said in a statement, “Our dairy farmers in Upstate New York and the North Country work hard to produce nutritious milk for our communities, and falsely labelling vegan juice as milk is a slap in the face to their hard work. I’m proud to support the integrity of real dairy products by holding the FDA accountable to making sure dairy imitators are not falsely labelled as milk.” See our alert, FDA issues draft guidance on plant-based milk alternatives: top points.

Biden Administration outlines goals for biotech, including key goals in food arena. On March 22, the Biden Administration outlined its “bold goals” for biotechnology in a new whole-of-government report encompassing a wide variety of arenas. In the realm of food, the Administration said it wants the nation to use biotechnology to improve agricultural productivity and sustainability, create more nutritious and safer food, and protect food animals and plants from pests and environmental harm. While there are specific R&D needs for each larger goal for biotechnology in food, the report also outlines needs that are common to all these issues. Among them: building more food-grade biomanufacturing facilities, including for precision fermentation; supporting infrastructure for more plant and animal gene sequencing and breeding; and developing a greater understanding of consumer acceptance of food products made with the assistance of biotechnology.

New Canadian-Mexican agreement for trade of organic food reduces barriers to access organic products. A new agreement between Canada and Mexico will now recognize both the Canadian Organic Regime and the Mexican organic system as equivalent. These systems are used to classify foods, including fruits, vegetables, meat and dairy products, and poultry, as organic and to permit them to be labelled as organic in either country. The recognition of both systems will enable Canadians to access more organic products without requiring additional certification for imported products, as well as permitting Canadian exporters to classify their products before export. The new agreement will apply to agricultural products that are grown, produced, processed or packaged in either country and to livestock and livestock products produced in Canada. This agreement joins other existing reciprocal organic agreements negotiated by Canada, including those with the United States, United Kingdom, Taiwan, Japan, the European Union, Switzerland, and Costa Rica.

New law in Maryland county aims to improve kids’ fast-food meals. On March 15, Montgomery County, Maryland, became the latest jurisdiction to require that restaurants that serve children’s meals offer as a default choice healthy drinks like water or low-fat milk instead of soda or other sugary drinks. A law passed by the county council last year went into effect on that date. In addition, in September 2023, restaurants in the county with kids’ menus must offer at least one healthy meal that meets the law’s specifications. The county, just outside Washington, DC, has 19 municipalities, among them Rockville, Chevy Chase, and Takoma Park, as well as large unincorporated communities such as Bethesda, Wheaton, and Silver Spring. The campaign to pass the ordinance was led by the Montgomery County NAACP, the American Heart Association, CASA of Maryland, and the Center for Science in the Public Interest, among others.

Former Blue Bell CEO agrees to plea deal, won’t be retried. On March 8, the US Department of Justice announced it is dismissing all fraud charges against former Blue Bell CEO Paul Kruse. Kruse will pay a misdemeanor fine for his role in a 2015 Listeria outbreak that was linked to Blue Bell products. Last year, a jury deadlocked over felony fraud charges, ending with a 10-2 vote in Kruse’s favor. This plea deal will require Kruse to pay a $100,000 fine, but he will not be retried and will not face any prison time. “The settlement confirms what Mr. Kruse has been saying from the very beginning, no one at Blue Bell ever intended to defraud its customers, and we are happy that the government has reached the same conclusion,” said Chris Flood, Kruse’s attorney. “This is the right result; it became clear during the trial last year that the government overcharged the case.”