Court
Rules in Favor of Nutraceutical
Park City, Utah (April 14, 2005) — Nutraceutical International Corporation (NASDAQ: NUTR) today announced
an important court decision that it believes will benefit its retail customers
and the public. On April 13, 2005, the United States District Court for the
District of Utah, Central Division, granted Nutraceutical’s motion for summary
judgment against FDA in Nutraceutical’s lawsuit involving FDA’s Final Rule on
Ephedra.
Mr. Bruce Hough, President of Nutraceutical,
commented that yesterday’s decision “is, in our view, about protecting the
public’s access to safe and effective dietary supplements and in clarifying the
meaning of the 1994 Dietary Supplement Health and Education Act (DSHEA). The
Court’s ruling clarifies the steps FDA must take to comply with the law in its
regulation of dietary supplements.”
Mr. Hough continued, “The Court made it clear that
FDA has authority under DSHEA to remove unsafe dietary ingredients from the
market. But the Court also clarified that FDA must follow DSHEA and cannot treat
dietary supplements like drugs or medical devices. The Court made other
important findings, pointing out that Congress intended that dietary supplements
be treated as a subset of foods and, like other foods, are 'presumed to be
safe.'”
Nutraceutical and its subsidiary Solaray, Inc.
marketed whole-herb ephedra as a dietary supplement from 1988 until April of
2004. At the time the Final Rule on Ephedra was issued, Nutraceutical and
Solaray’s product contained directions limiting dosage to 10 mg. or less of
naturally occurring ephedrine alkaloids per daily serving. Under the Court’s
Order, FDA’s Final Rule on Ephedra has been remanded to FDA for further
rulemaking consistent with the Order, and FDA has been enjoined from taking
enforcement action against Nutraceutical or Solaray for the sale of dietary
supplements containing 10 mg. or less of ephedrine alkaloids per daily dose. FDA
has the right to appeal the Court’s decision.
A complete copy of the Court’s decision may be
found at http://www.nutraceutical.com/courtruling/.
ABOUT NUTRACEUTICAL
Nutraceutical is an integrated marketer,
distributor, retailer and manufacturer of branded nutritional supplements and
other natural products sold primarily to and through domestic health and natural
food stores. Internationally, Nutraceutical sells its branded products to and
through health and natural product distributors and retailers. Nutraceutical’s
core business strategy is to acquire, integrate and operate, from beginning to
end, the marketing, distribution, retailing and manufacturing operations of
businesses in the natural products industry. Nutraceutical believes that the
consolidation and integration of acquired businesses provides ongoing financial
synergies through increased scale and market penetration, as well as
strengthened customer relationships.
Nutraceutical sells its branded products under the
trademarks Solaray®, KAL®, Nature’s Life®, Natural Balance®, NaturalMax®,
VegLife®, Premier One®, Sunny Green®, Natural Sport®, FunFresh Foods™, ActiPet®,
Action Labs®, Thompson®, Montana Big Sky™ and Body Gold®. Nutraceutical also
sells branded bulk products and custom blends under the trademark Monarch
Nutritional Laboratories™. Under the name Woodland Publishing™, Nutraceutical
publishes, prints and markets a line of books and booklets to, among others,
book distributors, national retail bookstores and health and natural food
stores. Nutraceutical’s neighborhood natural food markets operate under the
trade names The Real Food Company ™, Thom’s Natural Foods™ and Cornucopia
Community Market™ and its health food stores operate under the trade names
Arizona Health Foods™, Granola’s™ and Pilgrim’s Natureway™. Nutraceutical also
distributes the branded products of certain third parties.
Nutraceutical manufactures and/or distributes one
of the broadest branded product lines in the industry with over 3,000 SKUs,
including over 650 SKUs exclusively sold internationally. Nutraceutical believes
that as a result of its emphasis on innovation, quality, loyalty, education and
customer service, Nutraceutical’s brands are widely recognized in health and
natural food stores and among their customers.
The Securities and Exchange Commission ("SEC")
encourages companies to disclose forward looking information so that investors
can better understand a company's future prospects and make informed investment
decisions. Any statements contained herein that are not statements of historical
fact may be deemed to be forward-looking statements. Without limitation, the
words “may,” “will,” “should,” “believes,” “anticipates,” “plans,” “expects,”
“intends,” “estimates” and similar expressions or the negative thereof, or
variations thereon, or similarly, discussions of strategy, although believed to
be reasonable, are intended to identify forward-looking statements, although not
all forward-looking statements contain these words or discussions. There are a
number of important factors that could cause actual events or Nutraceutical’s
actual results to differ materially from those indicated by such forward-looking
statements, including, without limitation, (i) changing domestic and
international market and political conditions; (ii) interruption of business or
negative impact on sales and earnings due to acts of war, terrorism,
bio-terrorism, civil unrest, or disruption of mail service; (iii) slow or
negative growth in the nutritional supplement industry; (iv) changes in laws and
regulations, including adverse federal, state or foreign legislation or
regulation or adverse determinations or actions by regulators; (v) import/export
controls with respect to products sold into or purchased from foreign countries,
as well as other restrictions on the purchase or sale of Nutraceutical’s
products to or from such countries; (vi) unavailability of or interruption in
the supply of utilities, including electricity and telecommunications; (vii)
increased product competition; (viii) adverse publicity regarding nutritional
supplements (ix) increased costs, including raw material and labor costs, as
well as increases in the costs of borrowing (or the unavailability of adequate
credit); (x) inability of Nutraceutical to gain and/or hold market share of its
health and natural food store customers and bulk branded products customers;
(xi) loss or retirement of key members of management; (xii) inability of
Nutraceutical to successfully implement its business strategy or plan or
otherwise manage growth, including Nutraceutical’s ability to locate and
consummate advantageous acquisitions, or otherwise integrate or profitably
manage acquired operations, including the ability to retain customers of
existing and acquired operations; (xiii) product development efforts and
consumer acceptance of Nutraceutical’s products; (xiv) adequacy and availability
of insurance coverage, and any losses or damages sustained by the Company not
covered by insurance; (xv) availability and price of raw materials, including
increased costs; (xvi) Nutraceutical’s ability to manufacture its products
efficiently; (xvii) the mix of Nutraceutical’s products and their related profit
margins; (xviii) dependence on distributors and customers; (xix) sales and
earnings volatility; (xx) absence of clinical trials for many of Nutraceutical’s
products; (xxi) exposure to and expense of prosecuting, defending and/or
resolving and defending claims or litigation, including but not limited to
product liability claims, class action suits, stockholder derivative suits,
employment or labor related suits or investigations, patent or trademark
infringement suits and other litigation which may arise from time to time;
(xxii) inability of the Company’s retail stores to attain or maintain
profitability; (xxiii) other factors discussed in Nutraceutical’s filings with
the Securities and Exchange Commission or referenced in its press releases, and
(xxiv) other factors beyond Nutraceutical’s control.
In addition, any forward-looking statements
represent Nutraceutical’s estimates only as of the day of this press release and
should not be relied upon as representing Nutraceutical’s estimates as of any
subsequent date. No assurance can be given that the future results covered by
such forward-looking statements will be achieved and readers are cautioned not
to place undue reliance on forward-looking statements or historical results of
Nutraceutical. While Nutraceutical may elect to update forward-looking
statements at some point in the future, Nutraceutical specifically disclaims any
obligation to do so. For further details and a discussion of these risks and
uncertainties, see Nutraceutical’s SEC filings, which are updated from time to
time, copies of which are available upon request from Nutraceutical at
435-655-6106.
© 2005 Nutraceutical Corporation. All rights
reserved.