The FDA’s alleged case of mistaken identity

At a recent food technology expo, one of the trends that generated excitement was plant-based substitutes for meat and dairy. These foods appeal not only to vegetarians, who’d love to enjoy a guilt-free burger, but also to a broader public looking for healthier food alternatives. Consumers increasingly look for ways to enjoy their favorite foods and yet avoid the sky-high calorie count and potentially negative health impacts. To them, these innovative products offer an exciting opportunity to have it both ways. Yet, outdated Food and Drug Administration (FDA) regulations may stand in the way of these food technologies.

{mosads}The regulations in questions are standards of identity, which prescribe in great detail the composition and in many cases even the preparation methods for a wide variety of foods ranging from frozen dinners to salad dressings. All food companies must follow the standards or face repercussions from the FDA.

This was the case with Hampton Creek’s Just Mayo — a vegetarian alternative to the traditional mayonnaise. Last year, Unilever, the maker of Hellman’s brand of mayo, sued Hampton Creek for promoting its product as mayo even though it contained no eggs — a requirement under the FDA’s standard. Faced with public outcry, Unilever dropped its lawsuit a few months later. But the FDA picked up where Unilever left off and issued a warning letter to Hampton Creek, citing its failure to abide by the outdated federal standard for mayonnaise.

Hampton Creek is not alone. In July, Wonder Natural Foods received a warning letter from the FDA over its Better’n Peanut Butter spread. The company markets its product as a healthier alternative to traditional peanut butter spreads, but follows a different recipe. The FDA cited the company for failure to follow the federal standard for peanut butter.

Beyond the FDA’s actions, innovative companies trying to provide healthier alternatives to favorite foods often face lawsuits. In 2013, Silk faced a lawsuit over its milk substitute products like Soy Milk and Almond Milk because it did not follow the federal standard of identity for milk. A year earlier, several makers of Greek yogurt faced a similar lawsuit over the failure to abide by the standard of identity for yogurt. While both lawsuits were dismissed, fighting them in court still imposes considerable costs on companies.

Breyers, a popular brand of ice cream, decided to avoid this fight entirely and promoted its ice cream alternative as “frozen dairy dessert.” Yet, some consumers grumbled that it was not a “real” ice cream.

The problem with standards of identity is that they are outdated and no longer serve their original purpose. Congress charged the FDA with establishing food standards in 1938, when the country was still feeling the effects of the Great Depression. At the time, food remained the largest expense category and accounted for a third of expenditures of an average American household. For consumers shopping for food in 1930s, every calorie counted. So when food companies cheated by diluting their products or replacing some ingredients with cheaper ones, consumers and policymakers were legitimately outraged.

These days, our biggest problem is not scarcity of calories, but their abundance. Obesity has overtaken hunger as the biggest nutrition concern. In fact, consumers seek out the products that have fewer ingredients and calories. At the same time, our food is incredibly cheap. In 2014, food accounted for less than 7 percent of consumer expenditures for American households — the lowest share in the world. And as much as 40 percent of this food is wasted. The notion that food companies will try to cheat consumers by skimping on ingredients no longer holds. Why would they, when they can sell more products if they have fewer calories?

Health advocates often blame food companies for the growing obesity rates. Yet, when companies try to provide innovative solutions to obesity, they often run up against a wall of burdensome and often outdated regulations. If we are to succeed in stemming and reversing the growth in obesity, we need to let companies experiment and innovate without being tied down with a thicket of regulations. Perhaps then we might have our cake and eat it, too.

Abdukadirov is a research fellow in the Regulatory Studies Program at the Mercatus Center at George Mason University.