Ask most natural health consumers if they've had trouble purchasing their usual nutritional health products and most will admit, "no," they haven't, which is probably why many are beginning to wonder why they're signing petitions and reading about large amounts of products disappearing. What's all the fuss about?

January 2009 marks five years since Natural Health Product (NHP) Regulations
were implemented, requiring manufacturers to apply to Health Canada's Natural Health Product Directorate (NHPD) for approval and licensing for each of their products by the year 2010. Just how much of an impact the Regulations have had up to now depends entirely on whom you speak with.

"The problem is that 60 percent of licence applications have failed. These have been the 'easy' applications," according to the Natural Health Products Protection Association (NHPPA), a group interested in protecting the survival of small and medium NHP manufacturers, which is headed by NHP lawyer and consultant Shawn Buckley. He expects 70 to 75 percent of applications to fail, adding that, "For the NHP community, this means that 75 percent of NHPs we rely upon for our health will become illegal" once the Regulations are enforced in 2010.

On the other hand, Lionel Pasen, chair of the oversight committee of regulatory affairs for the Canadian Health Food Association (CHFA) and president of Natural Health Products Consulting Corp., in Toronto, Ontario, questions Buckley's estimations. Pasen's understanding is that many of the original product applications were rejected by Health Canada because they were poorly written, and that the manufacturers of these products have since reapplied.

A Health Canada representative told Health Action in October 2008 (at the
time of magazine production), "Since January 1, 2004, Health Canada has received 30,446 product licence applications. Of this number, 8,711 products have been issued a licence; 7,673 products have been refused and another 1,838 were withdrawn by the applicant. Health Canada is presently assessing 12,224 product
licence applications."

If you do the math, 29 percent of applications have received approval, 25 percent have been rejected, and six percent have been withdrawn, while 40 percent remain in limbo. Numbers may not tell the whole story, however. It is rumoured that many
manufacturers do not understand the complicated application process, that smaller
manufacturers cannot afford to comply with the Regulations and that many US
companies have simply chosen not to.

According to Buckley, "Canadians have already lost 20,000 safe and effective
natural health products." Pasen says, "If we're losing products, we're losing products that shouldn't be on the market to begin with."

What do NHP retailers say?
While most of the Canadian health food store owners I spoke with said they
have not noticed many Canadian products disappearing at this time, they have had
trouble receiving the products they usually get from the US. Many US brands, such
as Solaray®, have an excellent reputation and history of high quality and safety. The makers of Solaray® were one of many large US manufacturers who did not respond to requests for a Health Action interview on the topic of NHP Regulations in Canada.

Marvin Nider, pharmacist and owner of two popular Vancouver health stores called Mark's Pharmacy, explains, "We get a letter from Canada customs saying the US health products we've ordered do not comply with Health Canada Regulations. Then they ask whether we want them sent back to the US or destroyed." Nider, like many of the retailers I spoke with, feels that we won't see too many Canadian products disappearing until Health Canada starts to "crack down on the Regulations."

In Toronto, Julie Daniluk, RHN, the in-store nutritionist and co-operative owner
of the health food store The Big Carrot, says, "The US sees us [the Canadian market] as the equivalent of a small state," and suggests that we're not worth the trouble of complying to Regulations such as bilingual labelling, for example.  As for Canadian products, Daniluk agrees that the crackdown has yet to come. "We're waiting for judgment day," she says.

After 38 years in the health food retail business, Stella Gillies, owner of Kelly's Specialty Foods in Powell River, BC, says that in light of people dying from processed meat lately, she thinks asking NHP manufacturers to prove the safety and efficacy of ingredients that have been proven safe through thousands of years of use is unfair. She also points out that no one has ever died as a result of using an NHP in Canada, compared to the countless deaths caused by prescription drugs. Gillies is one of many retailers who agree safety and standards are a good thing, but not drug-style regulation.

The owner of the Optimum Health Vitamins and More stores in Edmonton and Sherwood Park, Alberta, John Biggs, goes so far as to say, "The Regulations are designed to squeeze out small business," so Health Canada can "pharmaceuticalize" the industry. He feels that the more innovative, combination and specific products, "the ones that take more understanding," as he describes, will be replaced with single products that are already available in big box stores. He sees the phasing out of industry innovation and smaller manufacturers as leading to a squeezing out of independent health food stores as well.

As missing US products begin to leave a noticeable gap on Canadian health food store shelves, retailers have come to refer to the looming Regulations enforcement deadline as "the crackdown." In other words, just because they and most of their customers have not noticed a big difference in terms of accessing products yet, doesn't mean they won't.

What do NHP manufacturers say?
While most retailers, along with their consumers, are just beginning to feel the effects of the Regulations, their impact on NHP manufacturers has been far from subtle. All manufacturers are required to scientifically prove each of their products is safe and effective, among other stipulations such as labelling and Good Manufacturing Practice (GMP). An approved product will receive a Natural Product Number (NPN). Without NPNs, products cannot be sold past the enforcement deadline. As a result, Canadian manufacturers have spent the past five years in the thick of a seemingly confusing and costly process that apparently isn't working, with the little guys possibly taking the biggest hit.

Janet Jacks, who, with her husband, founded the family chain of Goodness
Me! Natural Food Market stores in Hamilton and Burlington, Ontario, says she's
noticed many safe and helpful products disappear over the past few years. Jacks
mentions, as an example, the loss of a line of Canadian-made herbal tinctures. "We carried Rick's products for years," she says. "They were excellent," but are no longer available.

"Rick," is Richard DeSylva, owner of The Herb Works, which used to operate in Guelph, Ontario, as a $750,000 a year business. DeSylva, a registered herbalist and doctor of natural medicine, says the required testing for each of his 30
products would have cost him $350,000, plus an estimated $45,000 to hire a professional to handle the application paperwork, quality control procedures and other factors that compliance would force. Aside from his own costs, DeSylva says, "My customers, in the end, would have ended up paying double for the same safe and effective products." He walked away from the Canadian production and distribution portion of his business.

Meanwhile, other small manufacturers, who chose to remain off the record in
relation to this article for fear, they say, of attracting consequences that would hurt their chances of survival, continue to sell their products and hope that something changes before the 2010 enforcement deadline arrives.

Does size matter?
The Canadian NHP industry is composed of mainly small and cottage businesses,
according to a Business Impact Test conducted as part of a University of
Toronto study prior to the Regulations taking effect. They report that 50 percent of the NHP industry is comprised of small and medium-sized business and that a few large, multi-million dollar firms have a significant portion of the market share. The study, "The Canadian Natural Health Products (NHP) regulations: industry perceptions and compliance factors" (BMC Health Services Research, 2006), concluded that business size was relevant to compliance-all big businesses were compliant, small businesses were not and medium-sized businesses fell somewhere in between.

"The guys who will do well with this are the big guys, not the mom and pop
shops," says Gordon Chang, PhD, CEO and head of research and product development at Omega Alpha Pharmaceuticals, a medium-sized manufacturer in Toronto, Ontario, that has a reputation for high quality. He says that while it's good to have regulations, "The application of a drug model to a natural health product
doesn't work well."

Chang says he's fortunate that he has the scientific background to understand
the complicated and involved application process and requirements. However,
even a scientific background is not enough when it comes to complying with the proof of effects Health Canada wants in the form of clinical studies. Even if you
can afford the huge financial expense of clinical trials and have an in-house laboratory and experienced staff, which most small manufacturers cannot, Chang says they are "not appropriate" because the products cannot be patented, as is the case with drugs. "If I put in the money for proving the effectiveness and safety [of a NHP], but have no patent, the next guy can come along and benefit, but I've paid the huge price," he explains. But Brian Wagner, of NHP Consulting
Inc. in Victoria, British Columbia, says, "The big guys are suffering just as much."

The new Regulations state that manufacturers cannot advertise their products on
television or radio until they have approval and an NPN. But, according to Wagner
and every manufacturer I spoke with on and off the record, NHPs that have more
than one ingredient are, "virtually impossible to get approved right now," which is apparently a main cause of the application backlog at Health Canada.

Backlog at Health Canada
With more than 12,000 licence applications backlogged at Health Canada's
NHPD, even the manufacturers who are willing and able to comply with the Regulation application process are waiting literally years for approval and product numbers. It appears the Regulations do not accommodate the thousands of NHPs that contain a combination of ingredients. This rather large oversight lends even more validity to the argument of many in the NHP industry who say the Regulations are designed for drugs and will squeeze out innovative
and specialized products.

Chang says most NHPs are not single ingredients, which is what Health Canada
is set up to approve. "We have a lot of formula-type products," he says, "and they've been in the process [at Health Canada] for three years." At Preferred Nutrition, the Acton, Ontario-based manufacturer who makes high quality products exclusively for health food stores, including the Lorna Vanderhaeghe and Dr. Julian Whitaker supplement lines, all of their combination products are in the process-they have not received a "no" or a "go ahead." Company president Deane Parkes says the Regulations have not created a problem for his business because they do not have many products, but adds, "The potential for a problem is huge."

None of the large Canadian NHP manufacturers contacted, including Flora, Naka, Natural Factors and Trophic, would comment on the Regulations. However,
according to Wagner, a group of approximately 30 of Canada's largest NHP manufacturers have been meeting regularly to create a strategy to see Regulations improve. The group is not anti-regulation, he says, but feels betrayed by Health Canada, who has not followed through on the recommendations made in the Natural
Health Products: A New Vision report that was accepted in 1998 by then Minister of Health Allan Rock.

"We have found talking with the NHPD a waste of time," Wagner, who is a founding member of the group, says, adding that the NHPD "operates behind closed doors, leaving everyone in the dark." The group, which includes manufacturers such as Flora, Genuine Health, Jamieson, Natural Factors and Puresource, as well
as the Canadian Health Food Association, is also concerned about the 2010 enforcement of the Regulations.

Drop-dead date
Health Canada told Health Action, it has "committed itself to eliminating its
product licence application backlog by the end of 2010," and that they have implemented a number of measures, over the past two years, to become more efficient and timely in the licensing process. Health Canada adds, "Simplifying
the process for lower risk products has enabled Health Canada to focus the bulk
of its assessment resources on the most significant and difficult stream: complex, multi-ingredient novel products."

This backlog aside, the University of Toronto study findings suggested that a
possible impact of the NHP Regulations is that, "Some small firms may not be able
to survive the exigencies of the regulations and close their businesses."
The study also concluded that, "It is by no means clear that the small firms that
may exit the industry are currently making inferior products. Participants in this study seemed to think that smaller firms generally offer specialty products which certain consumers demand. If these smaller firms are forced to exit the industry, then many of these specialty products may no longer be available to consumers." Daniluk of The Big Carrot agrees. "Whether it's because of the financial cost
of compliance, the complication or the hassle of getting combination products that the Regulations are squashing the innovation of good products."

If the study's findings, along with the opinions and experiences of many retailers and manufacturers in the industry, are correct, then the impact of
the NHP Regulations will conflict with the role of the NHPD, which according
to Health Canada is, "Not to restrict or limit access to natural health products. Rather it is to help ensure that those products sold in Canada are safe, effective and of high quality."

Hurry up and wait
After five years of rushing to comply with the new Regulations, manufacturers,
along with retailers and consumers, are waiting to see how this six-year story will play out. Meanwhile, the NHP industry itself is divided into various groups with differing opinions of how to respond to the current Regulations and the
problems they've created. One manufacturer said, with the CHFA and the NHPPA not working together toward a common goal, "We're coming off as 'yahoos' and playing into the idea that we [the NHP industry] can't be
responsible."

No matter what view or action is taken, a seeming majority of interested parties agree that the current process is not working. Just what the NHP industry will look like as a result of the new Regulations cannot be fully realized until what manufacturers have dubbed the "drop-dead date," and retailers call "the crackdown."

As for consumers, who will be the last to feel the impact, loss of and
limited access to a variety of products may become markedly noticeable despite
Health Canada's stated intentions and manufacturers' best efforts.
We will soon find out.

[Sandra Tonn is a natural health journalist living in Powell River, BC. She relies on natural health products to maintain health and prevent disease.]

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