Oregon AG accuses retailer GNC of selling drug-spiked dietary supplements

An earlier version of this article reported the spelling of Jennifer Jakell's name as used in the lawsuit.

GNC (GNC), one of the world’s largest retailers of supposedly all-natural dietary supplements, has knowingly sold products spiked with two synthetic drugs, according to internal company records and a lawsuit filed Thursday by Oregon’s attorney general.

The suit accuses GNC of selling thousands of units of 22 workout and fat-burner supplement products that contained picamilon, a prescription drug in Russia that is used there to treat neurological conditions. Internal company records show a key GNC official knew as far back as 2007 the ingredient wasn’t natural, the suit alleges, and therefore could not lawfully be included in dietary supplements, which can only contain natural ingredients.

Oregon Attorney General Ellen Rosenblum also accuses the retail giant of selling other workout and weight-loss supplements that contained a synthetic amphetamine-like chemical known as BMPEA, Beta-methylphenethylamine and by several other chemical names. Among other evidence of wrongdoing, the attorney general's office cites emails circulated two years ago among top GNC executives in the wake of a 2013 USA TODAY article about BMPEA in supplements. "The USA Today article stimulated significant concern and discussion within GNC,” the suit says, yet the company continued to sell products containing BMPEA until earlier this year.

“GNC sells products obtained from third-party vendors that GNC knows or should know contain unlawful and potentially unsafe ingredients,” the lawsuit alleges, noting that GNC reviews and pre-approves all labels, packaging and marketing materials for products sold in its store that are made by other companies.

GNC, which initially said it wouldn't comment on the pending litigation, issued a short statement Thursday afternoon: "The claims made by the Oregon Attorney General are without merit and GNC intends to vigorously defend against these allegations. In response to FDA statements regarding the regulatory status of BMPEA and picamilon, GNC promptly took action to remove from sale all products containing those ingredients."

Shares of the company plunged almost 15% to $34.23 in late afternoon trading.

The suit alleges more than 4,000 individual violations of Oregon’s Unlawful Trade Practices Act, including failing to disclose that products contained the chemicals and misrepresenting that the products were lawful dietary supplements. Each violation carries a maximum penalty of $25,000.

GNC stopped selling products containing picamilon in September, the lawsuit says, after the Oregon attorney general's office notified GNC that the retailer was engaged in unlawful trade practices. Oregon officials in June had already demanded GNC provide the office with documents about its sales of the supplements because of the likelihood picamilon wasn’t a lawful dietary ingredient, the suit says.

According to the lawsuit, actions in May 2007 by a key GNC official — responsible for ensuring that supplement labels and scientific claims are accurate — show "GNC knew that picamilon is not a lawful dietary ingredient." Documents reviewed by the official at that time showed “that picamilon was a synthetic drug created by Soviet investigators and was not a lawful dietary ingredient in the United States,” the suit alleges.

Internal GNC documents obtained by the attorney general’s office show that Jennifer Jakell, GNC’s senior product manager for technical research, did a review of picamilon that included examining records translated from Russian. The records reviewed by Jakell described picamilon as one of  “a new class of medicinal preparations” and further explained that the compound was “synthesized in 1969 by the All-Union Scientific Research Institute.” She underlined some portions of the documents, the suit says. The Russian documents discussed the medication’s usefulness in treating memory, attention and learning issues, the suit says.

“GNC also knew that picamilon is not a lawful dietary ingredient because as part of her May 2007 review, Ms. Jakel documented in the GNC library file on picamilon: ‘No NDI that I could find,’” says the lawsuit, which spells Jakell's name differently than her email and LinkedIn accounts.

An NDI is a “new dietary ingredient” notification that must be filed with the U.S. Food and Drug Administration before a natural dietary ingredient not used in the United States before 1994 can be sold as a dietary supplement. The lawsuit alleges that Jakell again looked in April 2014 to see if an NDI had been filed for picamilon, noting in her file “still no NDI found.”

Nine diet supplements contain amphetamine-like compound

The lawsuit says GNC stopped selling BMPEA products in April, only after the FDA finally issued warning letters that month to a handful of supplement manufacturers listing the chemical on their labels. The FDA action came 18 months after the agency’s scientists had published research in a scientific journal finding “non-natural” BMPEA in nine dietary supplements that listed an ingredient called Acacia rigidula, which is a bushy plant found in Texas and Mexico. The FDA scientists in their article said they could not find BMPEA in verified samples of the plant and that the compound appears to have never been tested for safety in humans.

GNC knew about the FDA study as early as Nov. 2, 2013, when Jakell received an automated alert from a scientific journal cataloging service, the lawsuit says. But it was a USA TODAY news article about the FDA study a few weeks later that caused a cascade of concerns within GNC.

Jakell circulated the USA TODAY article to about 100 people at GNC’s headquarters, including GNC’s Senior Vice President and Chief Innovation Officer Guru Ramanathan and the company’s Vice President and General Counsel for regulatory affairs David Sullivan, according to the lawsuit, which describes a flurry of actions following the article.

“Please tell me we won’t have to get rid of acacia now,” a GNC merchandising manager wrote to GNC’s director of merchandising “within minutes” of receiving getting the email. GNC’s director of e-commerce soon learned of six “acacia rigidula” products sold by GNC, another top official offered to do a database search to find all affected products, the suit says.

Yet GNC continued to sell products that listed acacia rigidula as an ingredient, the lawsuit says, despite “widespread knowledge” they were “at high risk of having been spiked with BMPEA.” And the company also continued to sell supplements that specifically listed BMPEA on their labels, the attorney general alleges.

The FDA study, the lawsuit alleges, makes clear that BMPEA is a synthetic substance similar to amphetamine. "Thus, anyone aware of the 2013 FDA study would know that BMPEA is not a lawful dietary ingredient and that products labeled as containing acacia rigidula were at significant risk of being spiked with BMPEA," the suit says.

The Oregon lawsuit — coming from state rather than federal officials — raises questions about the effectiveness of the U.S. Food and Drug Administration in regulating the $35 billion dietary supplement industry, where weight loss, bodybuilding and sexual enhancement supplements have increasingly been found to contain hidden and risky pharmaceuticals.

"Basically the FDA has delegated its authority to the states, which they can't do," said Daniel Fabricant, executive director of the Natural Products Association, who previously directed FDA's supplement division. "If there was a problem with the product, they should have taken action." GNC is a member of the association and a GNC official serves on the group's board of directors.

Fabricant took specific issue with the FDA serving essentially as an expert witness for the Oregon attorney general by providing a written declaration, used as an exhibit in the lawsuit, that describes why picamilon "is not a dietary ingredient." The declaration was signed by Cara Welch, acting deputy director of FDA's supplement division. Before joining the FDA, Welch was a senior vice president at the Natural Products Association.

The FDA could have sent out a warning letter to companies about the issue, Fabricant said, but didn't. "There's got to be some due process here and there's not," he said.

Supplement regulators at the FDA were not available for comment Thursday. In a statement sent Friday, the FDA said it prioritizes enforcement actions based on its available and "limited" resources and the level of safety concern identified. "We are also working with our government partners — like the state’s attorney generals, the Federal Trade Commission and the Department of Justice — and with members of industry who have a vested interest in seeing bad actors held accountable," the FDA said.

Under existing law, the FDA says it must show a product is unsafe, that its labeling is false or misleading or that it was not made using good manufacturing practices before it can take any action to remove it from the market. The agency said it provided the declaration from Welch to Oregon investigators because it was in the public interest and promoted the objectives of the Federal Food, Drug, and Cosmetic Act and the agency.

Oregon Assistant Attorney General David Hart said state and federal regulators share common goals in protecting consumers and try to work together. “If the FDA is unable to take action, and the health and safety of Oregonians are threatened, Oregon can move in quickly to fill the regulatory void,” he said in a statement.

“Regardless of whether regulation of dietary supplements requires reform, more aggressive enforcement of existing laws will better protect consumers,” Hart said.

Read USA TODAY's "Supplement Shell Game" investigation of the people and companies behind tainted dietary supplements:supplements.usatoday.com

Follow USA TODAY investigative reporter Alison Young on Twitter:@alisonannyoung