Key takeaways from Cosmetic Products and Evolving Risk of Contaminants webinar

Contaminants in cosmetic and personal care products have become an increasing concern for manufacturers and suppliers as consumer expectations and regulatory scrutiny continue to evolve. A recent webinar held by the Global Retailer and Manufacturer Alliance, "Cosmetic Products and Evolving Risk of Contaminants," addressed the growing legal and reputational risks associated with contaminants, particularly for brands in the “clean beauty” space. Legal experts Rachel Raphael and Aliza Karetnick, provided an overview of the types of contaminants currently drawing attention, recent litigation trends, and strategies companies can adopt to mitigate these risks.

In this CosmeticsDesign Q&A, we explore key insights from the webinar, highlighting the impact of contaminants on product formulation, packaging, labeling, and advertising. The discussion offers valuable information for manufacturers and suppliers aiming to better understand the evolving risks and implement effective risk-reduction strategies in their operations.

CDU: Can you briefly define what contaminants are in the context of cosmetic products, and how they pose such a significant risk to the industry?

Aliza Karetnick (AK)​: Under the Federal Food, Drug, and Cosmetic Act (“FDCA”), cosmetics must be safe for consumers when used as intended. If a cosmetic is harmful to consumers, it is considered adulterated, and marketing or selling adulterated cosmetics in interstate commerce is unlawful.  

In the context of cosmetic products, contaminants may be microbial, such as bacteria or mold, or chemical, and may include heavy metals or other harmful substances causing a product to be considered adulterated under the FDCA.  

The personal care and cosmetics industry touches all of us, and the industry sets high standards for itself to turn out products that are safe and effective.  Contaminants, which in many instances can be avoided through strict application of GMPs and supply chain diligence, pose risk to the industry on several fronts. 

Most notably, contaminated products can cause significant brand or product-type reputational harm, and they can form the basis for protracted, costly class action lawsuits.

CDU: In your presentation, you discussed recent litigation around contaminants in cosmetics. What are some of the most pressing contaminants involved in these cases, and why are they gaining attention now?

AK​: Over the last few years, the industry has seen an uptick in “contaminant” class action litigation. In particular, cases claiming contaminants such as PFAS, benzene, asbestos and titanium dioxide have loomed large. 

Apart from asbestos, however, the plaintiffs typically allege economic, rather than physical, harm under state consumer protection statutes, such as deceptive trade practices and false advertising.  The increase in such litigation is at least in part attributable to the combination of “clean,” “green” and “free from” claims made by manufacturers and a creative plaintiffs’ bar seizing the opportunity to bring lawsuits without the burden of establishing adverse health consequences. 

In fact, more often than not, there are no known adverse health consequences associated with the cosmetic product.

CDU: How have the legal and regulatory risks associated with contaminants impacted the "clean beauty" movement, and what should brands in this sector be particularly aware of?

AK​: Notwithstanding the litigiousness of consumers, clean beauty appears here to stay.  The market for clean beauty is expected to grow significantly over the next few years even though the definition of "clean" is unclear. 

The notion of clean beauty first emerged in the 1970s with “no-makeup” marketing.  Over time, the term evolved with the growth of independent skin care brands that promoted natural and naturally-derived ingredients and frowned upon ingredients potentially linked to health or environmental issues. 

Today, "clean" tends to mean products formulated without ingredients like sulfates, parabens or formaldehydes, although there is no legal definition of "clean" from FDA or FTC for use in cosmetic labeling.

To avoid scrutiny for allegedly deceptive claims with respect to cosmetics marketed as “clean,” "natural" or "organic”, brands should know their supply chains inside and out, and should prioritize getting representations from suppliers or contract manufacturers all along the way.  In addition, they should be careful not to overstate the nature of the product– doing so may serve up a lawsuit.

CDU: What are some of the most effective risk-reduction strategies that cosmetics manufacturers and suppliers can implement to mitigate exposure to contaminants?

Rachel Raphael (RR)​: Given the ubiquitous nature of many chemical contaminants, risk is unavoidable. Steps that companies can take to limit their risk exposure, include, for example:

• Shoring up contracts with third parties: 
  • Contracts with any third parties involved in product manufacturing, processing, and packaging should include robust audit rights and assurances that those third parties are adhering to good manufacturing practices (GMPs) and taking necessary steps to prevent potential contamination. Cosmetics can become contaminated in many ways, including through raw materials, water, and other ingredients; poor manufacturing, shipping, and storage conditions; and inadequate packaging. 
• Actively supervising and clearly communicating with third parties: 
  • Cosmetic companies must make sure that their quality expectations are clear to any third parties, and they need to regularly exercise the audit rights in their third-party contracts to ensure that their manufacturing, processing, and packaging partners are holding up their end of the bargain.
• Adopting clear and comprehensive standard operating procedures:
  • Clear SOPs are how to best ensure consistency, efficiency, safety, and quality control. Also, the more robust and straight forward a company’s processes for testing, sourcing, batching, and validation, the better suited it will be in the face of a challenge.
• Appropriately training employees: 
  • How cosmetic companies interact with regulators is critical, and anyone in the organization who might send a communication to or receive a communication from a government agency must be trained on how to properly handle those communications.  

CDU: From your perspective, how can issues related to contaminants influence decisions around product formulation, packaging, labeling, and advertising?

RR​: The list of chemicals under fire continues to grow, and contaminant litigation is not going away any time soon. This is bound to impact how and where cosmetic companies manufacture, process, and package their products, and even where they source ingredients.

Although the immediate driver for many of these lawsuits has been a study or report coming out of an independent testing laboratory or research facility, regulators in the European Union have been leading the charge when it comes to banning and restricting ingredients in cosmetics and other personal care products. Companies that want to stay ahead of the curve (and prefer not to sell different product formulations in different countries) may start to dedicate more resources to keeping tabs on activity coming out of other countries around commonly-used ingredients and chemical contaminants, and take this into consideration when assessing product formulations and ingredient concentrations.

It may also impact relationships with third parties involved in manufacturing, processing, and packaging products, as companies hold their co-manufacturers, suppliers, and packers to higher standards when it comes to GMPs and certifications that products, ingredients, and packaging are free from chemical contaminants and/or other impurities.

We also expect this to influence what companies say in their product advertising, marketing, and labeling. For example, companies may start to include more caveats when it comes to proclamations about product safety or “clean”, “natural”, and “healthy” claims—providing more context for what companies mean when they use certain terms or phrases so as not to leave the impression that their products are free from every single potentially harmful chemical.

Companies may also start to include more extensive warnings about the risk of contamination; more robust instructions for safe use and storage of products (i.e.​, directing consumers not to share products with others, and to store in a cool/dry place); and better education on the ways in which consumers can contribute to contamination (e.g​., applying with unwashed hands, adding water or saliva to products, and using unwashed applicators)

CDU: Outside of MoCRA, have there been any recent or upcoming regulatory changes related to contaminants that manufacturers should be aware of? How do you see this evolving in the next few years?

RR​: In recent years, a growing number of states have proposed and/or passed legislation limiting and even banning the sale of cosmetics, personal care, and other products containing various types of ingredients alleged to be chemical contaminants. California boasts some of the most extensive legislation, following EU regulators in banning over two dozen chemical ingredients, ranging from PFAS and formaldehyde to parabens and phthalates.

Over the next few years, we expect more states will follow, while companies in the industry try to grapple with varying state restrictions, the first of which is set to take effect on January 1, 2025.

CDU: Given the evolving landscape of contaminants and litigation, what advice would you offer to manufacturers looking to future-proof their products and practices?

AK​: Stay abreast of regulatory changes at both the state and federal levels, as well as in the EU. Know your supply chain inside and out, and make sure co-manufacturers hold their suppliers to account. Regularly review and update SOPs, and craft tailored, rather than sweeping, claims that are well substantiated.