FSMA: Friend or Foe

by, Clear Labs, Inc.

Introduction

In 1880, Peter Collier, chief chemist at the U.S. Department of Agriculture, recommended a national food and drug law after conducting his own investigations on food adulteration. It didn’t pass, but the next 25 years saw more than 100 food and drug bills introduced in Congress.

That’s a lot – especially when we consider that the United States’ economy still hemorrhages about $7 billion every year due to food outbreaks.

The Food Safety and Modernization Act (FSMA) of 2011 is the latest addition to a complicated landscape of food safety regulation, which saw its last major update in 1938 when Congress passed the Federal Food, Drug, and Cosmetic (FDC) Act.

And FSMA is coming just in time – as the food supply chain gets more complex with globalization and the evolution of pathogens, food regulation needs to catch up. The way in which FSMA is addressing the fluidity and complexity of the food supply landscape represents a tectonic shift in food safety.

As the FDA states in the introduction to the act: “For the first time, FDA will have a legislative mandate to require comprehensive, science-based preventive controls across the food supply.”

Prevention is key – and something that we at Clear Labs hang our hat on. To date, reactive measures just haven’t worked: “48 million people (1 in 6 Americans) get sick, 128,000 are hospitalized, and 3,000 die each year from foodborne diseases” (FDA). Now, FSMA is trying to make sure that the food making these people sick never gets to the shelves in the first place.

In short, FSMA presents the opportunity to shift the food safety model from reactive to preventative. In doing so, it also uncovers inherent business opportunities for food industry players to optimize operations and improve their bottom line.

Common sense:

Regulation is always tricky, and we don’t argue that it will be an easy transition. Shifting the food safety model from reactive to preventative requires industry players to carefully examine their businesses and implement different levels and layers of reform throughout. The benefits will undoubtedly be worth the effort; however, the benefits may be well worth the effort.

Each section of the FSMA consists of specific acts designed to prevent consumers in the U.S. from getting sick due to foodborne illness.

Take, for example the “Hazard analysis and risk-based preventative controls” rule, which encourages heightened risk awareness across the food industry. The first step to creating a preventative model is to know where the risks lie and that means understanding every aspect of your business and your supply chain in intimate detail.

As with any evaluation, it’s easy to understand risks that are self-imposed, but by forcing into consideration risks that are both unintentionally and intentionally introduced, FSMA is asking brands to identify risks they may not have previously considered, and in turn, develop a heightened awareness of their industry.

A section entitled “Foreign supplier verification program” in section three requires business to critically evaluate the source of their ingredients and materials, including the compliance history of foreign suppliers used by importers. Importers must verify that imported food has been produced to meet applicable U.S. safety standards and that the supplier’s food is not adulterated or misbranded.

Businesses should already be assessing their suppliers to prevent adulterated or contaminated food from compromising their end product. The FSMA will help to ensure that conscientious brands aren’t losing market share to unscrupulous operators who don’t take the same care to invest in the security of their supply chains.

At it’s core, FSMA calls for a heightened awareness that will help prevent and mitigate risk in every part of the supply chain, from shipping ports to grocery store shelves. No wonder it’s been called the “common sense law.”

Regulation as opportunity:

The obvious benefit, and the ultimate goal of FSMA is to stem foodborne illness and prevent the need for recalls by addressing both the human and capital cost of compromised food.

Hopefully, FSMA will help us realize the goal of moving food safety from a reactive to a proactive model. Forward-looking brands also realize that employing FSMA as a proactive model for championing food safety aligns with practices that can help them boost their bottom line.

Consider the implications of intimately understanding the risks to your supply chain. Being intimate with the details of your supply chain means having control over your business.

Similarly, by understanding and thoroughly vetting suppliers firms can insulate themselves from substantial risk and protect their brands.

The fact that regulation can be an opportunity is by no means a novel concept. It’s been proven in other industries. Paul O’Neill, former CEO of Alcoa, for example, transformed his entire corporation and drastically improved his bottom line by championing worker safety. By the numbers, Alcoa’s annual net income was 5X greater than when he started.

Similarly, in the complexity of today’s food supply chain, FSMA offers the opportunity to fundamentally change the way the food industry operates and increase profits while doing so.

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