The undersigned, upon acceptance of this affidavit by the Assistant General Counsel, Fraud and Mailability Division of the Post Office Department, as a basis for disposing of the pending charges, waives all rights to any present or future indemnity covering insured or c. o. d. shipments of the merchandise sold under the above names and involved in this proceeding, and agrees that any such claim may be forthwith disallowed by the Post Office Department. And further affiant saith not. Subscribed and sworn to before me, a Notary Public in and for the State of County of--this-------- day of 19-----. My Commission expires__ Notary Public. EXHIBIT 12B MAIL FRAUD ORDER POST OFFICE DEPARTMENT Washington ORDER NO. Satisfactory evidence having been presented to the Post Office Department that at engaged in conducting a scheme or device for obtaining money through the mails by means of false and fraudulent pretenses, representations, and promises in violation of sections 259 and 732 of title 39, United States Code, said evidence being a part of the record in the case identified below by docket number, and by authority vested in the Postmaster General by said laws and by him delegated to me by orders of the Deputy Postmaster General, No. 55628, dated May 17, 1954, and No. 56214, dated October 10, 1956, you are hereby forbidden to pay any postal money order drawn to the order of said and you are hereby directed to inform the remitter of any such postal money order that payment thereof has been forbidden, and that the amount thereof will be returned upon the presentation of the original order or a duplicate thereof applied for and obtained under the regulations of the Department. You are hereby further instructed to return all letters, whether registered or not, and other mail matter which shall arrive at your office directed to the said (except letters or mail matter which can be identified on the face of the envelope on wrapper thereof as not being relative to this enterprise, such as letters from public utilities, Federal, State, or municipal agencies, doctors, lawyers, churches, or magazines and newspapers) to the postmasters at the offices at which they were originally mailed, to be delivered to the senders thereof, with the word "Fraudulent" plainly written or stamped upon the outside of such letters or matter. Where there is nothing to indicate who are the senders of letters not registered or other matter, you are directed to send such letters and matter to the appropriate dead letter branch with the word "Fraudulent" plainly written or stamped thereon, to be disposed of as other dead matter under the laws and regulations applicable thereto. (H. E. Docket No. To the Postmaster, -.) General Counsel. EXHIBIT 13 DEPARTMENT OF HEALTH, EDUCATION, And Welfare FOOD AND DRUG ADMINISTRATION Washington 25, D. C. ADMINISTRATION INFORMATION LETTER NO. 337 J'ANUARY 28, 1957 608-(546) (535.5) (520.P) DISCUSSION OF PHENYLPROPANOLAMINE HYDROCHLORIDE (PROPADRINE The districts may receive inquiries about this drug, now extensively promoted as an appetite depressant, from cooperating officials and consumers. The following is quoted from the Administration's letter of November 26, 1956, to the National Better Business Bureau, Inc., and states our present attitude on the 'drug. It may be used as a basis for answering inquiries. In addition to “E. H. P.," a similar drug is distributed under the name "Hungrex" by the Allegheny Pharmacal Corp., New York City. "We have your letter of November 14 concerning 'E. H. P.' (eat half plan) distributed by North American Stevens, Inc., 132 West 21st Street, New York 11, N. Y., and other phenylpropanolamine hydrochloride appetite-depressing drugs. "As you can appreciate, due to the confidential nature of our files, we cannot furnish you with information on the nature of any discussion or correspondence we have had with the distributor of E. H. P. "We have told a number of firms that a 25-milligram tablet of phenylpropanolamine hydrochloride taken 3 times a day would not be regarded as a new drug for over-the-counter distribution when sold as an appetite depressant; larger doses would be regarded as a new drug if intended for over-the-counter distribution for this purpose. Whether or not a product is or is not regarded as a new drug is based on safety alone and not efficacy. "E. H. P., according to its label, contains 10 milligrams of phenylpropanolamine hydrochloride and 80 milligrams of caffeine per tablet as active ingredients. It would, in our opinion, be safe for unsupervised use, provided the directions and warnings in its labeling are adhered to. Appetite-depressing claims for E. H. P. are based on the presence in the drug of phenylpropanolamine hydrochloride and caffeine. "Caffeine, as you perhaps know, is a central-nerve stimulant, and each tablet would have about the same influence on appetite control as an average cup of coffee. "Phenylpropanolamine hydrochloride is similar in physiological action to ephedrine, except that its side effects are not as great. It is nearly devoid of stimulating effects on the central nervous system. It has, under the name of 'propadrine hydrochloride,' achieved widespread recognition and use for the symptomatic control of allergic manifestations of hay fever and bronchial asthma and for many years has been marketed under over-the-counter labeling for this purpose. "More recently, phenylpropanolamine hydrochloride has achieved some acceptance from medical authorities as an adjunct for controlling appetite in dietary management. This latter claim is given some credence and support by its recognition in several published articles, and in New and Nonofficial Remedies recommends single doses of 50 milligrams and up to 150 milligrams per day as is necessary for curbing appetite. We believe dosages of this magnitude for over-thecounter use would be new drugs. In this connection, our New Drug Branch has had occasion to process application for phenylpropanolamine hydrochloride in 25-milligram dosages for the treatment of allergic conditions, and the clinical evidence submitted in connection therewith convinced them that such dosage of phenylpropanolamine hydrochloride was safe for sale direct to the public. We also think the labeling for E. H. P. and similar products should warn against their use by persons with heart disease, thyroid disease, high blood pressure, or diabetes mellitus, except under a physician's supervision. "We reached our conclusions regarding safety for use of phenylpropanolamine hydrochloride in the 25-milligram single dose, 75-milligrams-per-day maximum dose level after consultation with authorities who had used the drug extensively. For example, we solicited the opinion of the medical referee of the subcommittee at the time phenylpropanolamine was up for consideration before the council on pharmacy and chemistry of the American Medical Association for inclusion in New and Nonofficial Remedies. He advised us that the hazard that would accrue from the administration of 25 milligrams of the drug twice a day would be so slight that, purely from the standpoint of safety, sale to the public should be allowable. "We entertain reservations with regard to the validity of the claims for appetite depression advanced for phenylpropanolamine hydrochloride, in view of the absence of reports of appetite depression associated with its rather extensive use in treating allergic disorders, its slight central stimulating effects, and paucity of carefully controlled studies demonstrating efficacy in this regard. When we have occasion to advise manufacturers of such products with regard to the validity of the claim for appetite depression, they direct our attention to page 182 of the current issue of New and Nonofficial Remedies, the statement appears: "To depress appetite in obesity, 50 milligrams 2 or 3 times daily before meals for adults.' We have expressed our misgivings about the validity of this claim to the council on pharmacy and chemistry of the American Medical Association, and they advise us that, unless or until more carefully controlled studies are reported which might place the matter in a different light, they would continue to recognize its use as an appetite depressant in the treatment of obesity. You will appreciate that in proceeding against such types of products the burden of proof is upon us, and in view of the reports in the literature on the alleged use fulness of phenylpropanolamine hydrochloride in appetite depression and retention of statements in New and Nonofficial Remedies in this regard, it would be virtually impossible for us to proceed against such products. "We have no information on the cumulative effects of phenylpropanolamine hydrochloride in the system so are unable to reply responsively to your questions regarding these." EXHIBIT 14 [Federal Trade Commission, Office of Information, press release, June 9, 1954] WORKING AGREEMENT BETWEEN FTC AND FDA The Secretary of the Department of Health, Education, and Welfare, Mrs. Oveta Culp Hobby, and the Chairman of the Federal Trade Commission, Edward F. Howrey, jointly announced today the approval of a working agreement between the two agencies. Its objective is to correlate more effectively the work of the Commission and the Food and Drug Administration and to prevent overlapping activities and duplication of effort. Secretary Hobby and Chairman Howrey issued the following statement: "The close parallel in purpose between provisions of the Federal Trade Commission Act which deal with advertising of foods, drugs, and cosmetics, and the labeling requirements of the Federal Food, Drug, and Cosmetic Act has led to overlapping activities on the part of the two enforcement agencies. Such overlapping arose primarily because the same representations regarding a product may be both advertising and labeling, depending on the circumstances of each A clearly defined understanding between the two Government organizations is essential to prevent needless duplication of effort. Certainly, 2 different agencies should not start legal proceedings against a business firm for essentially the same reason unless the public interest requires 2 proceedings. case. "In concluding the working agreement, our purpose, among other things, is to improve the liaison between the two agencies and insure a properly coordinated and effective law-enforcement program in the important field of foods, drugs, and cosmetics." The agreement provides more effective liaison, particularly in instances where "(a) The same, or similar, claims are found in both labeling and advertising. "(b) Written, printed, or graphic material may be construed as either advertising or as accompanying labeling, or both, depending upon the circumstances of distribution. "(c) The article is a drug or device and appears to be misbranded solely because of inadequacy of directions for use appearing in the labeling for conditions for which the article is offered in advertising generally disseminated to the public." Liaison activity in these circumstances will be "for the purpose of avoiding duplication of work and to promote uniformity and consistency of action in areas where both agencies have a concern and the actions of one agency may affect proceedings by the other," the agreement says. The text of the agreement is attached. "WORKING AGREEMENT BETWEEN FEDERAL TRADE COMMISSION AND FOOD AND DRUG ADMINISTRATION "The Food and Drug Administration of the Department of Health, Education, and Welfare is charged with the enforcement of the Federal Food, Drug, and Cosmetic Act. This act makes illegal any article of food, drug, device, or cosmetic that is adulterated or misbranded while introduced into or while in interstate commerce or while held for sale after shipment in interstate commerce. When the surveillance and investigative work of the Food and Drug Administration discloses a violation of the statute, the facts are reported to the Department of Justice with a recommendation for seizure, criminal prosecution, or injunction actions in the Federal courts. Under the provisions of the statute, each of the four commodities dealt with is deemed to be misbranded 'if its labeling is false or misleading in any particular.' In addition to this general misbranding provision, the Federal Food, Drug, and Cosmetic Act also defines a number of other circumstances under which a food, drug, device, or cosmetic shall be deemed to be misbranded-some of these definitions of misbranding being applicable solely to foods, drugs, devices, or cosmetics, as the case may be. Among the definitions of 'misleading' specific to drugs or devices is the requirement that the labeling of these articles bear. 1 (adequate directions for use, and (2) such adequate warnings against use in those pathological conditions or by children where its use may be dangerous to health, or against unsafe dosage or method or duration of administration or application, in such manner and form, as are necessary for the protection of users. "The Federal Trade Commission enforces the Federal Trade Commission Act, which prohibits unfair competition and unfair or deceptive acts and practices in commerce. The Wheeler-Lea amendment to the Federal Trade Commission Act specifically declared the false advertisement of food, drugs, devices, or cosmetics to be an unfair or deceptive act or practice. This amendment defined the term 'false advertisement' as applied to food, drugs, devices, and cosmetics as meaning an advertisement, other than labeling, which is misleading in a material respect, and provides that, in determining whether any advertisement is misleading, there shall be taken into account (among other things) not only representations made or suggested by statement, word, design, device, sound, or any combination thereof, but also the extent to which the advertisement fails to reveal facts material in the light of such representations or material with respect to consequences which may result from the use of the commodity. "The two agencies have a common objective of preventing deception of the public through the misrepresentation of food, drug, devices, or cosmetics. The Food and Drug Administration strives to prevent misrepresentation of these commodities by means of false or misleading statements made in labeling or by the omission of certain required information from the labeling. The Federal Trade Commission strives to prevent the misrepresentation of these four commodities through the use of false or misleading statements in advertisements or the omission of certain necessary statements from advertising. The definition of a false advertisement of a food, drug, device, or cosmetic contained in section 15 of the Federal Trade Commission Act specifically excludes labeling. The definition of labeling in the Federal Food, Drug, and Cosmetic Act includes written, printed or graphic matter which accompanies a food, drug, device or cosmetic and by regulation this includes such matter accompanying an article while it is in interstate commerce or while held for sale after shipment or delivery in interstate commerce. Written, printed or graphic matter descriptive of a food, drug, device, or cosmetic may at one time be used as advertising and at another time accompany the article and thereby become labeling. "The requirement of the Federal Food, Drug, and Cosmetic Act that drugs or devices bear adequate directions for use has been judicially interpreted as including directions for the use of the drug or device for the purposes for which it is prescribed, recommended, or suggested in advertising. "While the responsibilities of the two agencies thus are closely related in many respects, significant differences in procedure and in nature and effect of sanctions are inherent in the statutes and regulations governing the two agencies. The close relationship of the objectives of the two agencies in the respects outlined herein, however, is now recognized as required a more effective liaison for the purpose of eliminating any duplication of effort and resulting waste. "In order to provide for exchange of complete information so that both agencies will be utilized to the maximum effectivness in the public interest, each agency will designate a liaison officer to serve as the primary source of contact. These liaison officers will be responsible for currently informing each other of proposed proceedings within the below-described area to effectuate the purposes of this agreement. "At all times and to every extent possible each agency will furnish information to the other prior to the expenditure of time and effort for investigation or other steps preliminary to specific regulatory action. The liaison will be directed to correlating the work of the two agencies, the elimination of duplication of effort in individual cases, promoting uniformity and consistency in handling matters throughout those areas which are of mutal interest and recommending to higher authority the adoption of policies which will further promote uniformity of actions and enforcement of law in the public interest. "It is agreed that "(1) The Federal Trade Commission has primary responsibility with respect to the regulation of the truth of falsity of all advertising (other than labeling) of foods, drugs, devices, and cosmetics. In the absence of express agreement between the two agencies to the contrary, the Commission will exercise sole jurisdiction over all matters regulating the truth or falsity of advertising of foods, drugs, devices, and cosmetics; "(2) The Food and Drug Administration has primary responsibility for preventing misbranding of foods, drugs, devices, and cosmetics shipped in interstate commerce: In the absence of express agreement between the two agencies to the contrary, the Food and Drug Administration will exercisesole jurisdiction over all matters regulating the labeling of foods, drugs.. devices, and cosmetics; "(3) The initiation of proceedings involving the same parties by both agencies simultaneously shall be restricted to those highly unusual situations where it is clear that the public interest requires two separate proceedings. For the purpose of avoiding duplication of work and to promote uniformity and consistency of action in areas where both agencies have a concern and the actions of one agency may affect proceedings by the other, it is recognized that such liaison activity is required-- "In instances where: "(a) The same or similar claims are found in both labeling and advertising: “(b) Written, printed, or graphic material may be construed as either advertising or as accompanying labeling or both, depending upon the circumstances of distribution; "(c) The article is a drug or device and appears to be misbranded solely because of inadequacy of directions for use appearing in the labeling for conditions for which the article is offered in advertising generally disseminated to the public. "Approved: "Secretary, Department of Health, Education, and Welfare. "OVETA CULP HOBBY, "EDWARD F. HOWREY, "Chairman, Federal Trade Commission.” |