#367 - The Insider's Guide to Supplements: What Every Founder Needs to Know About Compliance, Claims, and Scale

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1:18What is going on, DTC Pod? Today, we are joined by Graham Rigby, who is the president and CEO of the American Herbal Products Association, or the AHPA. And he also has a ton of experience working in the space. He's worked as the chief innovation officer at Careof, and he's worked directly as one of the co-founders of Infinite Garden, as well as working on ingredient AI. So before I get too far into everything, Graham, I'll let you kick us off. You're someone who has a ton of experience in the herbal supplement sort of space. You've been working in this sector for a long time. There's massive changes that have been going on.

1:58We've seen some of the biggest brands in wellness and D2C scale in this category. So excited to have you on. So maybe we can just start with a little bit more about your background, how you found yourself into the role and what you spend your time focused on at this intersection between, you know, herbal wellness and direct-to-consumer. Yeah, thanks for having me. Very excited to be here. Big fan of the pod and obviously all you do for the entrepreneurial and just health and wellness community. Yeah, as you said, I've been in health products, dietary supplements for the past 20 years on the industry side and startup side for a lot of it.

2:37And now leading a trade association sort of tasked with providing education, guidance and understanding of how best to compete, grow and be compliant in our regulated industry. The industry is thriving. I think herbal products have gone from$2 billion in 2000 to$13.3 billion last year. And that's driven by a number of vectors. One is all these amazing young startups that are happening. Founders are getting companies and they're not just doing your traditional vitamin mineral preparations. They're focused on herbs. They want stories. They want things that they can kind of tell. and their consumers ultimately want feedback and they want sort of results from these.

3:20It's not just sort of the age old. How do I age healthily? You know, I might have some joint concerns. I need things for joint health. People are taking products for beauty. They're taking it for athletic performance. They're taking it for stress and sleep. And these are benefit areas that are attracting a whole wider swath of consumers. it's not just sort of you know weekend warriors 45 plus types now that are looking to supplements you've got teenagers you've got college students you've got people in their 20s looking to look and feel their best and are turning to herbs much sooner than generations that preceded them um graham that's that's such a good point in terms of just like how the landscape sort of shift i think the way you're characterizing it in terms of uh you know there's a lot of marketers who have been able to like enter the space and tell those compelling stories.

4:08Whereas before it was kind of like, you know, you would just go to your local herb shop and get what's on the shelf. And it was like, it's a totally different kind of marketing environment. But, you know, one thing I want to talk about on this, this episode, well, there's two, two big things that I think we can go into. One is what does this actually mean? Like how have some of these, the biggest best in class brands done it? What did they need to know from the regulatory point of view and how they work with the AHPA to do it? And the second is more around like regulation. Obviously, we'll get into innovation and stuff, but I want to know, like, what is this space look like?

4:49Because I think a lot of times when consumers or brand builders or whatever hear about supplements like, you know, on the e-commerce side, you hear, oh, my God, supplements are so hot. Everyone's doing supplements. Every influencer and their their friend is launching a supplement. But, you know, you and then on the other side, you just hear like horror stories of these like supplements that are just sold in gas stations with super sketchy ingredients and all of this. So I think there's going to be a lot of us, a lot for us to unpack. But maybe we start with, you know, in the in the vein of like just DTC and stuff that you've done with leading brands.

5:21Like how does the HPA interface and how have you guys like worked with some of these bigger brands that that are super, you know, household names? Yeah, I mean, it's a great question. I think maybe a couple of milestones to put out there for the audience. One is in 1994, there was a landmark legislation passed called the Dietary Supplement Health and Education Act. And that basically created the framework for what we now know as dietary supplements over 30 years ago. That sort of opened the doors to innovation and allowing people to suddenly find herbs, multivitamins, protein powders, a lot of the products that we know as dietary supplements today.

6:05But it also created a highly regulated framework with which FDA would provide oversight. Supplements, first and foremost, are regulated as food. And they are food supplements. And so obviously food is in the definition. But when you think about capsules and powders and soft gels, they also look closer to OTC and drugs. And so in addition to that 1994 law, in 2007, good manufacturing practices were mandated by FDA that came into effect in 2010. And those GMPs, there's a lot of acronyms in regulated industry, of course, those good manufacturing practices, they govern how you identify the composition of your products, how you manufacture them, and how you ensure each specification confirms the identity, potency, composition, and purity of each dietary supplement.

7:03And so there's a lot of regulation to understand. There's a lot of regulation and guidelines that APA, you know, at the American Overproducts Association, we help companies, especially small, medium-sized businesses, understand the regulations, provide templates and ways with which to comply, and then host educational events that provide a way for people to sort of get a huge download of, okay, what are the most important things I need to know? How do I best comply? How do I kind of keep up with all the regulations and things that aren't just coming from the federal level now? In 2025, we've seen a lot happen on the state level as well.

7:42And APA and organizations like us, we're there to sort of consume everything that's going on from a regulatory state and federal government level and provide sort of an extraction of that that's easy to consume for members so that they can make sure they're compliant and focus on growing their businesses without worrying about any compliance gaps. So maybe a fun way to kind of like put this would be like if I'm starting a supplement brand, right? Like what do I need to know about, you know, compliance? Like how do I do it? Right? Like, you know, do I you mentioned you need you might need a GMP facility.

8:23You may need certain sort of packaging. There might be certain things that I can and can't say. But let's just use the example of a super traditional, like easy ingredient, nothing super complex. You know, how would a founder go about bringing a supplement brand to market? What is that minimum viable sort of thing that they need to do to get an ingredient from some sort of manufacturer to sell it to a consumer? Yeah, it's a great question. I mean, I think the first is sort of understanding the idea and the consumer framework, right? Which a lot of founders and startups, that's where they start.

9:01Like, where is the idea? Where can I disrupt this industry? Where is some way to differentiate? The good news is once you have that, the dietary supplement industry is a group of, you know, kind of external partners with which you can kind of build a relationship with to help you with both the sourcing, the manufacturer, the bottling and the labeling of these products. And so there are many contract manufacturers, raw material suppliers, you know, sort of label packaging suppliers that are all within both APA membership and just the industry writ large that are there to sort of help you understand all the different things.

9:42So it's not like you're going to be flying to India to find ashwagandha, to farm it yourself. You know, you can obviously partner with folks who are expert and have done that. But there are a lot of responsibilities for the brand itself. Once you've sort of up and running, you do have to create specifications for your products so that your contract manufacturer knows what they're building, knows what you're looking for. You can work with contract manufacturers. They have R &D teams you can work with, you know, to sort of understand what are some of the things I want in and out. Do I want a clean label product?

10:16Do I want to add any additional ingredients in addition to, say, ashwagandha that you might be wanting to formulate with? All the way to sort of what is the label going to say and what are the claims I'm going to be able to make off of those? You need to have kind of those specifications. You need to register with the FDA that now you're sort of a food brand that is going forth and you're going to start putting products in. And then one of the things that is really helpful about that 1994 law we talked about before is it doesn't require pre-market approval. And so you don't have to wait for FDA to go through all your documentation.

10:55You have to have all that documentation and compliance ready to go. But you can launch your product and notify FDA within 30 days of launching it that you've done so and any claims associated with products you've made. And then the way that the regulations work is it's a post-market surveillance regulatory regime, which means FDA has inspectors that can come to your facility or come to your offices whenever they want in the U.S. unannounced and basically will go through all that documentation. we talked about, your specifications, your labeling, your claims, all these things that you have that need to comply with the regulations, and they'll do an audit.

11:35And basically, they'll go through all that documentation. They'll sort of find that you're in full compliance or maybe find a couple of things that you might need to sort of work on. And then if you get any sort of observations, you'll have 15 days to kind of submit back to FDA. Here's our corrective action plan. Here's some things that we can do to kind of do this better. And it's a way that FDA can make industry better while it's out there serving the consumer needs for health and wellness products. And it's pretty unique. We're very fortunate in the U.S. to have this innovation friendly environment, but it's not without all of these compliance requirements that definitely need your attention, which can be overwhelming when you just start out.

12:20You know, it's like, wow, I'm one person or I've got a small founding team, you know. And so that's where you can kind of rely both on partners, contract manufacturers, suppliers, as well as trade associations like Copa to kind of help fill in the gaps and have a lot of experienced folks like myself that have done this for a long time to kind of give you some clues or help, you know, answer some of the questions that might take you a long time to figure out on your own. And what are the differences, I guess, just for, you know, people are listening and I think you kind of alluded to it, but what are the differences between like a drug, a pharmaceutical drug that's like done and goes through trials and like has claims versus like a supplement or a nutraceutical that, you know, you can kind of sell, make sure your your claims are compliant.

13:04You've kind of put it through. You've registered with the FDA. But I think one thing everyone sees on all these packages is like this statement has not been evaluated by the FDA. Right. So like what's what's the difference between these two worlds between pharmaceuticals and like these nutraceuticals? Yeah, it's a great question. You know, underpinning all of the Food and Drug Administration's efforts is consumer safety. And so like first and foremost, whether it's a drug, whether it's an over-the-counter drug or whether it's a food or dietary supplement, safety is obviously the most important thing.

13:38And so for a lot of drugs or like new to the world chemicals that that are not natural or not found in nature, there's a whole set on series of safety trials that need to happen from, you know, cell culture all the way through human clinical trials just to prove that it's safe. There's no untoward effects. And then it moves on to sort of efficacy. And that's really in an environment where a pharmaceutical company is looking to kind of own that chemical and then brand it and obviously have a lot of years of run where they're the exclusive provider. That is their IP. That's their unique way to market, which is obviously lucrative.

14:19And then you go through pharmacists, doctors, prescriptions, everything. But the way that they get to safety and efficacy is through multiple clinical trials, oftentimes because it's completely novel what they're doing to the world. On the food side, there are several pathways to prove that something is safe. And once you select an item that has a proven track record for safety, it's in the food supply, it's done sort of significant toxicology work, then those are things that you build on within the dietary supplement space. And so something needs to have sort of an underpinning of safety. It's either been used, you know, as a food stuff or, you know, an article of food for a long time predicating the laws sort of on the books, or it's gone through the significant rigorous toxicology study and allowed for it to sort of be made a dietary ingredient.

15:13And then once you have an ingredient that's sort of past all that, that is an approved dietary ingredient from FDA, then it can go into dietary supplements and be sort of manufactured so long as it's following sort of the contours of the approvals that that ingredient has made in terms of its form, its preparation, and in sort of the composition that it follows, as well as the dose. You know, there's a pathway for new dietary ingredients that you can petition FDA to say, here's a new, you know, a new botanical that didn't follow some of those things, you know, an old dietary ingredient or, you know, it's in the food supply and it's generally recognized as safe.

15:55So as a new dietary ingredient, you have to sort of prove that that ingredient is safe, FDA review it, and then they'll give you sort of an NDI approval with which you can move forward. So there's lots of gates that you can kind of go through to make sure something is safe. It tends to be faster than pharmaceuticals and tends to require less. But it also offers less in terms of claims. Like if you just have a certain ingredient, there's only so much you can say about it. But many companies like APA member AG1, they've done several human clinical trials with which now they can make, you know, specific claims on, hey, AG1.

16:35is great for digestive health. It's great for gut health. We know that is this powerhouse sort of, you know, superfood and super greens beverage, but they've really been able to identify through the power of clinical research, more benefit areas that are unique to them. And that's, you know, I think an emerging area that is now accessible to founders in a way that it wasn't, you know, I first started in, you know, the mid two thousands to do a human clinical trial would It costs you$400 ,000,$500 ,000. You'd have to have a site. Recruited people would have to drive to the site. They'd get their blood taken, whatever.

17:12Now, in 2025, there are startups like Radical Science, like People Science, again, people within the op orbit that we could introduce you to if you have questions of talking to these folks. But they're using the power of the smartphone to allow people to enter in how they're feeling, what's going on. so they can participate in clinical trials at home. And that has brought the cost down significantly. You're talking about 10 % or 20 % of the cost it would cost 20 years ago. And so that's been a huge boon and allowed a lot of these companies to sort of invest in clinical research when they get to a level or when they think they can use that as a proof point for consumers to get them to say yes.

17:56Because there's a lot of options and there's a lot of ways to, a lot of products out there within dietary supplements, as though clinical science is one way to differentiate. It's not a requirement for safety per se, but it does help you set yourself apart and differentiate in the ways that we see kind of ultimately drug companies using clinical research to kind of put forth benefits that they've proven. So slightly different, they're obviously, dietary supplements are absolutely not drugs. They don't cure, prevent, treat disease. That's very clear on that little box that you sort of referenced.

18:32But the one thing that the Shea box, you know, also says is the FDA doesn't evaluate those statements, which it does. That 30-day sort of requirement that I mentioned before, you send that to FDA. And if you make a claim that is, you know, not true or that it's a drug claim, for example, you say you're curing some disease, the FDA will write you back and say, that's not an appropriate dietary supplement claim. You need to change that. Otherwise, you know, you'll sort of set off a series of accelerating engagement from the agency that you really don't want. I would not recommend that, you know, you want to sort of comply with appropriate structure function statements that promote the health and wellness of the body versus treating or curing a disease.

19:18And that's the major distinction in terms of claim structure between food supplements and drugs. Yeah. And I want to kind of just double click on that because I think that's kind of where rubber meets the road for a lot of marketers. Right. In terms of like, what can you say versus what can you not say? What is a health claim? What isn't a health claim? I think, you know, right now you're seeing every brand is, you know, backed by science and formulated with so and so and influencers are launching supplements and everything. So you've got a lot of chatter. You've got a lot of marketers who are, you know, doing their thing, kind of pushing that line, figuring out like where it is.

19:59So what just simply put, like, what can you say? What can't you say? And like, yeah. Yeah. And I think, you know, Wayne, this is a really it's a great question. And it's the hardest thing when you get into health and wellness startups because consumers do not think this way. Right. Consumers aren't like, oh, this is the regulatory framework for dietary supplements. And that does not equal what I see on OTC products. And that does not equal what I see all the drug advertising that I consume. They just think, oh, I've got something wrong with me. Can I take this product for it? But, you know, as marketers and as, you know, startups, we have to sort of evaluate what is appropriate for a supplement to say so that we don't delve into or sort of make drug claims, which would make the company liable.

20:48They're very competitive, but I would say they're not very sustainable over time because if you grow and you make enough noise, then the regulators will definitely find you and certainly help you move back to the dietary supplements sort of contours of claim structure that you should. I think an easy way to think about it as you're jumping in is additive things that are promoting health and wellness, that are sort of promoting skin hydration and glow and moisturization and not treating sort of a skin ailment or disease. that's a way it's sort of like if you think of sort of additive and up to the right versus taking someone that's sort of in deficit and bringing it back those are typically good ways to think about it you're promoting you're enhancing sort of workout performance you're doing those things versus kind of treating a negative um oftentimes we think of that way because if we're consumers um but we want to promote you know the the immune system function versus treating anything that our immune system might be fighting, you know, is a good way to kind of divide it up.

21:59Clearly, the most competitive ways for startups to compete are, you know, right on the line of those things. And there are many, you know, excellent sort of resources to help you. I would highly recommend as you get going that you identify sort of a capable FDA attorney who can help you understand both, you know, where a claim can fit and how aggressive or conservative you want to make. And then secondly, the substantiation that you need to have for that claim, because the more specific or aggressive a claim you have, the more data you need to have to support that as well, because there's not only sort of FDA regulations to worry yourself with.

22:39There's also the Federal Trade Commission, who, if you're making fraudulent claims, you're making things that aren't substantiated. that's the agency that would typically look at that. And they have engaged on dietary supplements in the past around immune health and in other areas. And so it's something to be mindful of. You both need to sort of meet, you know, what is an appropriate claim for a dietary supplement that sort of follows promoting the structure and function of the body and health systems. And then, you know, on the FTC side, making sure you have substantiation to really under, you know, underpin it.

23:15And then also give your consumers confidence. And the thing I like to say with new members starting up, you know, and as companies are getting into it, you really want the consumer to have an experience that they can either feel or recognize or trust with the science that you have, because the worst thing you can do is pay the cost to acquire a consumer and have them churn after one bottle or one piece, right? Like that is absolutely no way to make on D2C money. And so clearly having things where you've got a sustainable building approach and something that people can recognize, which often costs a little more than the basic standard, but can pay off in the long run and obviously having higher attention.

23:57Yeah. And I think one other last question on the claim side is, is there a distinction? Because I feel like one of the big things all these brands are doing is they're running all sorts of marketing messaging to like target different indications, like as you scale, it's just inevitable, right? Like your target for first, you just start with one indication. And then you're like, wait a minute, this ingredient, you know, does all these different things. So we're going to segment our audience, we're going to target, you know, gut health over here, we're going to target brain health over here, etc, etc.

24:28So how does is there a difference between what you can say on a label, right? Like versus what, you know, you can just convey through, you know, online creative or what other online content creators are sort of saying, is there any distinction or does it remain the same? Yeah, it's a great question. I mean, I think FDA has said, you know, that it's sort of website or content that you're creating is sort of de facto labeling, especially if it goes back to the sale of a product, which I'm assuming most content, you know, whether you're on TikTok or Instagram is sort of doing that. There are certainly some rules where you don't have to have all of, you know, if you're laddering back to a website, having all of the different distinctive, you know, language or the Dachey box or all the things we've talked about, you know, there's ways to kind of make it cleaner and more seamless so long as that, you know, warning is obviously displayed when you get to the product page.

25:29And as you're looking to sort of do that, But you can certainly talk a lot more about your products and sort of bring romance and other angles versus the maybe specific structure function claims. And so that's an area you see a lot of people, you know, people are interested, especially younger generations, you know, millennials, Gen Z, alphas. They want to know where their products are coming from. They're very interested in sort of how clean these ingredients are in the overall format. Are there a lot of preservatives? Are there a lot of other things that really aren't health claims at all? They're not given the same regulatory rigor.

26:05There's more classic definitions of, is this an artificial preservative or not? And do I have it? Is it something that I can't pronounce? Or is it something like rosemary or oregano that's obviously providing, you know, a natural preservative in a fish oil or something like that that you see on the market? So I think, you know, those guidelines still hold. Obviously, you know, people take a little bit of latitude. It's easier to sort of take down creative that pushes the line versus to change your label in some ways. And so you certainly see people doing that. And again, I think these are all calculated choices that being mindful of the regulations and the marketplace, you know, that's that's kind of the challenge for marketers and founders in this space is finding that niche and sort of that through line of being compliant and competitive, which is a challenge, but it is achievable.

26:59Next thing, I want to switch gears a little bit. I think we've covered a fair amount on the compliance side of things, but I want to talk about the industry in of itself. I think we see a lot of brands who do really well on the storytelling side, on the ad side, on the UGC, on the creator side that can scale really quickly. But what are some of the channels in the nutraceutical, the wellness supplement sort of space that maybe a lot of people don't know about that they can tap into for growth? For example, what is the distribution picture look like for retail? How do some of these brands that are in the supplement space get into retailers?

27:43Are there other sort of channels that people may not be thinking about other than their own shop? Obviously, driving traffic to your own shop is, you know, one way to do it. You can control the margins. You can control the spend. You can grow up. But at the end of the day, you're driving all your own traffic. So I just love to talk about what does this landscape look like? Because a lot of people who are getting into supplements, you know, they're like, oh, like I've got this problem that I want to solve. Oh, my God, I can solve it with like this really great ingredient. OK, I'm going to start driving creative and driving all this stuff to my own site.