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International Supply Chain a Challenge to FSMA's Effectiveness
by Ted Agres
Food companies and government regulators ARE coming to grips with the immense challenges that await them as they begin to implement FSMA requirements.
For U.S. companies, these challenges will involve verifying ingredients across the global supply chain and adhering to international standards such as GFSI and ISO 22000. Missteps along the way are likely to result in ingredients or finished products being detained and placed on FDA’s Import Alert List. The end result, some experts predict, will be the demise of many small- and mid-sized U.S. food companies that find themselves unable to implement the new law’s many requirements.
“There are challenges for regulators and challenges for the private sector from FSMA,” said David Acheson, MD, director of the food and import safety practice at Leavitt Partners and a former FDA associate commissioner of foods. “Companies are becoming increasingly nervous about their supply chain and the reliance they place on the certificates of analysis on meeting the specs,” Dr. Acheson told Food Quality magazine. “This is especially so if they are relying on a core piece of paper or two to give them assurances that their upstream has the necessary controls or HACCP in place.”
For the FDA, the challenges involve creating new and effective third-party certification and audit regimes and overseeing a vastly more complex import review system. While FSMA imposes scores of new requirements on the FDA, including tight timelines to draft and implement new regulations, it does not provide the funding to hire the hundreds of new employees necessary to implement the law—a substantial drawback, especially during the current budget deficit crisis. The FDA needs $1.4 billion from 2011-2015 to fulfill FSMA requirements, according to the Congressional Budget Office, but the agency’s food safety budget is likely to remain flat or increase only slightly in 2013.
Even if it were provided adequate funding, the FDA acknowledged it will need time to create the necessary process and management infrastructure. “A new management structure, supporting processes, and permanent staff positions must be created to launch a systems approach to risk-based decision making,” the agency said in its five-year strategic plan, released in April.
An additional challenge facing regulators will be audit execution oversight. “That will involve a whole new parallel track for accreditation of auditors,” said Dr. Acheson. “Who will police the auditors? The FDA could do so, but it lacks the resources and skills necessary. So the FDA will probably appoint yet another private third-party organization to audit the auditors and police the system,” he predicted.
FDA’s Broad Responsibilities
Enacted in January 2011, FSMA gives the FDA responsibility for mitigating food safety problems using science- and risk-based approaches to oversee roughly 80% of the nation’s domestic and imported food supplies. In addition to establishing minimum produce safety standards and requiring food growers and facilities to implement hazard prevention control plans, the FDA has the authority to order mandatory recalls of suspected food products, conduct a broad range of food facility inspections, and establish a comprehensive product tracing system.
FSMA requires imported foods to be held to the same standards as domestic foods, and importers and foreign suppliers must have preventive controls in place to ensure product safety. Qualified third parties will be authorized to certify that foreign food facilities comply with all U.S. food safety standards, a step that will help facilitate the entry of their products into the country. The FDA can also expedite review and entry of foods from importers that participate in a voluntary qualified importer program, and refuse entry if the agency is denied access by a facility or by the country in which the facility is located.
Among the many regulations the agency has drafted to implement the law—but not yet released at presstime—are those to establish the foreign supplier verification program, accredited third-party certifications, and third-party certification of high-risk foods. “FSMA shifts the burden to importers,” Dr. Acheson said. “They have to take responsibility for monitoring their imports upstream under FSMA.”
It is widely expected that the FDA will recognize and adopt at least some ISO standards for inspection and accreditation purposes. But until the FDA’s regulations are released (they have been held up under review by the Office of Management and Budget since at least January), details remain unknown. However, the law explicitly requires the FDA to consider existing standards for guidance to avoid unnecessary duplication of efforts and costs.
“FDA will recognize accrediting bodies and set standards for accreditation of third-party certification bodies and auditors aimed at ensuring the rigor, objectivity, and, most importantly, the transparency of third-party audits,” said Michael R. Taylor, FDA deputy commissioner for foods. “Transparency means that the results of audits for certification will be available to FDA, which in turn means that we can both assess the rigor of private audits and rely on them,” Taylor told the Global Food Safety Conference in Orlando, Fla., in February.
GFSI and Audits
Dr. Acheson expects the foreign supplier verification program to focus mainly on high-risk foods and incorporate standards similar to GFSI’s. “To some extent, it will intersect with GFSI, but my guess is that it won’t be quite the same,” Dr. Acheson said. “It will probably go a little beyond GFSI. I’m also guessing that GFSI will adapt itself to whatever standard that FDA puts in place.” The FDA has refused to comment on any possible role that GFSI or other organizations might play in its standards setting.
Craig W. Henry, PhD, director of enterprise risk services-business risk at Deloitte & Touche LLP, predicted that accredited third-party certifications and audits will become even more complicated under FSMA, because the FDA’s criteria “could be in tandem or potentially in conflict with the third-party audits that are available and used commercially today around the world.”
“This is especially important for produce, where you don’t want a short shelf-life product sitting in port under test and hold,” Dr. Henry told Food Quality. “You’ll want to make sure that the FDA will recognize the food safety system that’s being used, and you want to make sure that product is in the green lane as soon as possible.”
Many large companies use GFSI as a baseline but also send their own auditors overseas to inspect facilities, especially when ingredients may be particularly vulnerable to problems and their brand reputations are at stake. “That’s very prevalent among large U.S. manufacturers,” Dr. Acheson explained. “In addition, the GFSI audit is only as good as the auditor. He or she may be having a bad day or, who knows, they may even have accepted a bribe.”
“Auditor competences are critical to the success of our mission,” acknowledged Yves Ray, GFSI chairman and general manager for corporate quality at Paris-based Danone. “Food safety hazards may be introduced at any point along the food chain. One weak link can result in unsafe food harmful to consumer health and very costly,” he told the annual Food Safety Summit in Washington, DC, in April.
Paperwork: A two-edged Sword
Many companies believe they create and maintain the proper records and have a good document control system in place to support their food safety programs. But these may not be enough. “These companies need to go back and really understand how their standard operating procedure is being implemented and consistently executed across all their facilities,” Dr. Henry said. “They need to understand that anything going back two years will be fair game.”
Under FSMA Section 201, the FDA is required to significantly increase the frequency of its domestic and foreign inspections. “FDA inspectors are limited, and they can only spend so much time in plants during routine inspections. But by looking at records, they can identify areas for further investigation,” Dr. Henry said. As Taylor noted in his Orlando speech in February, the FDA may want not just the certificate of a third-party audit, but also the entire audit itself. “This will be a very significant lift for everybody when this program becomes implemented and measured by what the enforcement actions are taken for non-compliant facilities,” Dr. Henry predicted.
The key concept is “business continuity” of the entire supply chain—from field to restaurant or retail grocer. “The challenge for industry now is validating the integrity of the food safety systems being used to supply their upstream supply chain,” Dr. Henry said. Instead of relying on third parties to certify ingredients, companies will need to be more aggressive and invest more time and money, especially if the external supply chain is important to their brand. “They really need to make sure they know what’s going on and not assume all is well, especially with FDA inspections picking up,” he said.
While most large companies may be able to undertake the extra effort, FSMA requirements could overpower small- and mid-sized companies so that they are unable to compete, said Benjamin England, chief executive of FDAImports.com, a firm that represents importers seeking to navigate U.S. import and other regulations.
“The costs to small- and mid-sized importers will likely become severe in coming years, regardless of any exemptions that FDA might hand out to them,” England told the Food and Drug Law Institute’s annual conference in May. “These companies simply don’t have the relations with foreign suppliers necessary to implement the statutory language. This will cost U.S. jobs, reduce competition, and produce more very large food companies, which is not necessarily better when it comes to food safety,” he added.
One of the main ways this can happen is through product detention. Running afoul of FSMA requirements can result in products being placed on the FDA Import Alert list, said Rick D. Quinn, an attorney with FDAImports.com. The Import Alerts, also called FDA automatic detention lists, instruct import inspectors, investigators, and compliance officers to automatically detain or detain without physical inspection all imports of affected products from the listed manufacturer, shipper, grower, or even geographic area. Once a product or company is placed on the list, it can be very challenging to convince the FDA that the violation has been corrected.
“FSMA imposes many new requirements on importers and food companies, so there will be many more opportunities for companies to be put under import alerts,” Quinn told Food Quality.
Ted Agres is based in Laurel, Md. Reach him at firstname.lastname@example.org.