Supplement Maker Settles for $5.5 Million

BUFFALO, N.Y. (CN) -Iovate Health Sciences will pay $5.5 million to settle FTC charges of falsely advertising that its "diet supplements" can help people lose weight and treat colds and other illnesses such as hay fever.

The Federal Trade Commission accused Iovate Health Sciences USA and two of its Canadian affiliates of disseminating false and unsubstantiated information in print, television and Internet ads.

The $5.5 million will go to customers who bought the weight-loss supplements Accelis and nanoSLIM, or any Cold MD, Germ MD or Allergy MD product.

The supplements were sold at retail stores and over the Internet but have been discontinued.

Iovate netted $21.3 million from its weight-loss drugs and another $5.7 million from its MD products, the FTC said in its filing.

Iovate's ads for nanoSLIM claimed customers could "Lose 32 lbs. FAST," or 2 pounds a week by using Accelis.

The ads featured purported testimonials from customers and falsely claimed Accelis was scientifically proven to increase the body's metabolism, the FTC said.

By calling drugs "diet supplements," rather than drugs, companies such as Iovate elude a slew of federal controls.

The FTC said Iovate also made false and unsubstantiated claims that some of its cold and flu supplements had been clinically tested. Some ads for Cold MD, Germ MD and Allergy MD featured people in white lab coats with stethoscopes.

Ads for Cold MD claimed it decreased the duration of colds by 94 percent and increased resistance to colds and flu by 312 percent - whatever that may be presumed to mean. (One hundred percent resistance would be sufficient.)

The FTC said that Iovate knew that information was false when it ran the ads.

The agency also accused Iovate of falsely claiming that its Allergy MD Rapid-Tabs were homeopathic.

In settling with the FTC, Iovate did not wrongdoing, but it is barred from making any claims about its drugs and supplements that are not supported by the Food and Drug Administration.

Iovate Health Sciences, based in Ontario, Canada, is now known as Kerr Investment Holding.

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