Consumer Health Digest #01-48

Your Weekly Update of News and Reviews
November 26, 2001

Consumer Health Digest is a free weekly e-mail newsletter edited by Stephen Barrett, M.D., and cosponsored by NCAHF and Quackwatch. It summarizes scientific reports; legislative developments; enforcement actions; news reports; Web site evaluations; recommended and nonrecommended books; and other information relevant to consumer protection and consumer decision-making.

Vitamin cartels heavily fined. The European Commission has fined eight companies a total of 855.22 million euros (about US$755 million) for participating in secret market-sharing and price-fixing cartels affecting vitamin products between September 1989 and February 1999. The Commission's investigation, which began in May 1999, found that 13 companies participated in eight cartels aimed at eliminating competition in the markets for vitamin A, E, B1, B2, B5, B6, C, D3, biotin, folic acid, beta carotene, and carotenoids. Hoffmann-La Roche and BASF, the two main vitamin producers, participated in virtually every cartel, whereas the rest were involved with fewer products. According to the Commission:

The prime mover and main beneficiary of these schemes was Hoffmann-La Roche, the largest vitamin producer in the world, with some 50% of the overall market. The cartel arrangements covered its full range of vitamin products. The involvement of some of its most senior executives tends to confirm that the arrangements were part of a strategic plan conceived at the highest levels to control the world market in vitamins by illegal means. [European Commission imposes fines on vitamin cartels. News release, Nov 21, 2001]

Commenting on the case, Competition Commissioner Mario Monti stated: "The companies' collusive behavior enabled them to charge higher prices than if the full forces of competition had been at play, damaging consumers and allowing the companies to pocket illicit profits. It is particularly unacceptable that this illegal behavior concerned substances which are vital elements for nutrition and essential for normal growth and maintenance of life." The fines were imposed as follows:

The five remaining companies—Lonza AG (Germany), Kongo Chemical Co Ltd (Japan), Sumitomo Chemical Co Ltd (Japan), Sumika Fine Chemicals Ltd (Japan) and Tanabe Saiyaku Co Ltd (Japan)—were not fined because the cartels in which they were involved ended five years or more before the Commission opened its investigation. The cartels related to B1 and B6 escaped for the same reason. In 1999, three of the companies pleaded guilty in the United States to similar anticompetitive conduct and paid heavy fines (US$500 million for Hoffmann-La Roche, US$225 million for BASF, and US$72 million for Takeda).

Philip Morris to change name. Philip Morris, which owns one of the world's most recognizable corporate names, has announced plans to change its name to Altria Group next year if its stockholders approve. [Schwartz S. Philip Morris to change name to Altria. New York Times, Nov 16, 2001] The apparent purpose is to suggest to consumers (and investors) that the company, which owns Kraft Foods and Miller Brewing, has become a good corporate citizen and is not just a cigarette-maker whose best-known product is a leading cause of preventable death and disease. Press reports note that "Altria" is drawn from the Latin word "altus," meaning "high" and is supposed to suggest high performance. Noting this monumental event, SatireWire has announced that lung cancer will change its name to Phillip Morris to gain greater exposure. [Philip Morris to change name to Altria; Lung cancer to change name to Philip Morris: Rebranded disease gains universal negative brand imagery. SatireWire Web site, Nov 20, 2001]

FDA warns against Lipokinetix. The U.S. Food and Drug Administraiton has warned consumers not to use Lipokinetix, marketed a "dietary supplement" by Syntrax Innovations, Inc., of Cape Girardeau, Missouri, because the agency has received at least six reports of users who developed liver injury or liver failure. [FDA Warns Consumers Not to Use the Dietary Supplement Lipokinetix. FDA Talk Paper T01-59, Nov 20, 2001] The product has been claimed to produce weight loss by "mimicking exercise" and supporting "an increased metabolic rate." Its ingredients include norephedrine (also known as phenylpropanolamine or PPA), caffeine, yohimbine, diiodothyronine, and sodium usniate. The reported problems occurred in persons between 20 and 32 years of age between 2 weeks and 3 months of Lipokinetix use. The FDA also advised physicians to review their cases of hepatitis to determine whether any are related to use of the product. Sale of the product appears to have stopped.

FDA Web site highly rated. A study released by Brown University's Taubman Center for Public Policy has rated the FDA's Web site best among the the 59 federal sites it examined. The project evaluated whether needed information was available on sites and if average citizens could easily find this information. Sites were graded on factors such as presence of contact information, availability of online publications, online services provided, and whether the sites included "one-stop shopping" portal pages with links to government services. [West DM. State and Federal E-Government in the United States, Sept. 2001]

Antiquackery book bargain. In "Lying for Fun and Profit," Kurt Butler reveals how talk shows and other media outlets promote quackery without the slightest concern about whether or not they harm their audience. He also describes his many efforts to counter the problem. The book originally marketed for $19.95, is now available from Quackwatch (P.O. Box 1747, Allentown, PA 18105) for $6 plus $3 for postage and handling.

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This page was posted on November 27, 2001.