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FDA Stops Two Dietary Supplement Firms From Selling "Cure All" Products

(April 5, 2004 - The Food and Drug Administration (FDA) today announced that Seasilver USA, Inc., and Americaloe, Inc., of Carlsbad, California, and their principals, Bela Berkes and Jason Berkes, have signed a consent decree of permanent injunction in which they agreed to stop manufacturing and distributing violative products, including “Seasilver” – a purported cure-all liquid supplement. This action is the culmination of coordinated efforts by FDA and the Federal Trade Commission (FTC) to act against the marketing of these violative products.

“This is yet another example of FDA’s strong commitment to protect the public from unscrupulous dietary supplement manufacturers that make unsubstantiated drug claims,” said FDA Commissioner Mark B. McClellan, M.D., Ph.D.

The consent decree gives FDA the authority to order the firm to discontinue the marketing of and recall any products that violate the law in the future. The decree also allows for liquidated damages for any further violations. The liquidated damages provision of the consent decree requires the companies and their principals to pay $1,000.00 for each article distributed in interstate commerce in violation of the consent decree, the retail value of each lot manufactured in violation of the consent decree, but not distributed in interstate commerce, and $10,000.00 per day, per violation for any other violations of the consent decree. The consent decree was signed on March 8, 2004, by United States District Judge William Q. Hayes in San Diego, Calif.

This consent decree follows a coordinated effort in June 2003 between the Federal Trade Commission (FTC) and the FDA against Seasilver U.S.A., Inc., and Americaloe, Inc., their owners, and two of the companies' principal distributors. On June 16, 2003, at FDA’s request, U.S. Marshals seized 132,480 bottles of Seasilver, worth nearly $5.3 million, from Seasilver USA’s San Diego headquarters.

The Government’s complaint alleges that, although Seasilver USA markets Seasilver as a dietary supplement, the companies promote it on the Internet and in marketing materials sent with the product as a treatment for “over 650” diseases including, for example, cancer, heart disease, stroke, diabetes, hepatitis, arthritis, depression and other diseases. These claims cause Seasilver to be an unapproved new drug under the Federal Food, Drug, and Cosmetic Act (FD&C Act). Such claims also cause Seasilver to be misbranded under the FD&C Act because it lacks adequate directions for use.

Seasilver’s labeling also contains claims such as “cleanses your vital organs” and “oxygenates your body’s cells.” These claims show that Seasilver is intended to affect the structure or function of the body. Because the claims are unsubstantiated, Seasilver is misbranded under the FD&C Act.

The FTC, which regulates dietary supplement advertising, alleges, in part, that the defendants promoted Seasilver through false claims that it was clinically proven to treat or cure 650 diseases, including cancer and AIDS. Under a settlement with the FTC, entered on March 4, 2004, the Seasilver defendants and the individual distributors agreed to pay $4.5 million in consumer redress. In addition, the FTC settlements also bar defendants from making any false or misleading claims about the benefits of any food, drug, or dietary supplement.

"The claims for Seasilver threatened consumers’ health by encouraging delays and replacements for proven treatments," said Howard Beales, Director of the FTC's Bureau of Consumer Protection. "The FTC and FDA are committed to taking aggressive action against false and unsubstantiated claims in the dietary supplement market. Products touted as cure-alls almost always cure nothing.”

As a result of FDA’s consent decree, Seasilver U.S.A. and Americaloe, Inc., will destroy the seized products at their expense under the supervision of a Department of Health and Human Services representative within 60 days of posting bond.


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