Currently, companies are allowed to make several types of claims:
- health claims -- aka REAL health claims -- which must have evidence that meets a standard called "significant scientific agreement"
- qualified health claims -- aka WISHFUL health claims -- which can meet a weaker standard of evidence, so long as the company admits the weaker evidence on the label
- structure / function claims -- aka STEALTHY health claims -- which purport not to be health claims (for example, a high-fiber product that "keeps your bowels moving" without explicitly claiming to "treat constipation"; or a high-calcium product that "builds strong bones" without explicitly claiming to "prevent osteoporosis")
FDA was forced several years ago to allow qualified health claims, because companies had sued in court over their First Amendment rights to make claims that had some scientific evidence, even if there was not enough to count as Significant Scientific Agreement. However, the necessary cautionary statements about weak evidence are a turnoff for the consumer, so manufacturers have not made major use of these qualified health claims.
As a consequence, manufacturers have placed most of their bets on structure / function claims, which do not have to be backed by much evidence, because these claims pretend not to be health claims in the first place. The only time FDA can take action against a structure / function claim is if it is blatantly false or misleading.
The most striking thing about the new GAO report is that it recommends FDA strengthen its ability to find out if such claims are false or misleading. GAO points out that the Federal Trade Commission, which regulates advertising, has the authority to ask companies to present evidence for their claims. FTC officials told GAO that they would be unable to enforce the rules without this authority to ask for evidence. However, FDA lacks the authority to make companies share their evidence. GAO recommended that FDA identify and request from Congress the authority it would need to effectively judge whether structure / function claims are false or misleading.
I am curious what Alex Tabarrok would say about this GAO recommendation. Alex is a widely read economist blogger at Marginal Revolution, who tends to be ferociously (and thoughtfully and provocatively) critical of FDA on other regulatory issues.