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The Food Manufacturing Brainstorm features industry experts sharing their perspec-tives on issues critical to the overall food industry marketplace. In this issue, we ask:

As the Food Safety Modernization Act begins to take effect, what should food manufacturers do to ensure that they are in compliance?

BRAINSTORM

Randy Fields, Chairman and CEO, Park City GroupFew companies understand both the shortcomings of the Act and the true cost of what is at risk.The law, in reality, is far short of what is in fact needed to provide a

reasonable level of both consumer level food safety and, as importantly, brand safety.

Being in compliance with the Act, as it is currently being dis-cussed, will not provide much additional safety to American con-sumers and certainly will do little to help companies protect their brand reputations.

It is interesting to note, that in spite of the pressure under which consumers find themselves, that Whole Foods is the standout performer among the major supermarket players. The positioning of Whole Foods is not simply “organic.” It is safe.

The ads showing the Whole Foods employees at the dock, checking fish as it is brought to shore, certainly leaves the impression that safety first is the real reason that Whole Foods is gaining share.

One only needs think about the brands that have been nearly destroyed by safety issues to appreciate that the FSMA is only a starting point, not a destination. u

Bill Bremer, Principal, Kestrel Management Services

Companies should assess their food safety programs and develop plans to ensure their compliance. The requirements of the Food Safety Modernization Act (FSMA) will be implemented based on the timeline of the FDA, and it is cur-rently enforceable, at least in part. With new authority, the FDA can exercise a number of actions for requirements including compliance with the existing 21 CFR FDA as well as employee protection under the new law.

Also, note that, while certain aspects of the new law represent specific industry require-ments like baby formula, produce or importations, exemptions include those with annual sales under $500,000 and limited geographic distribution.

The 21 CFR FDA statutes that must be met include: Building/Premises, Equipment, Prerequisite Programs as well as Good Manufacturing Practices (cGMP’s), verification and validations of processes and the procure-ment and receipt of safe food. Common viola-tions under the existing laws include inadequate Premises and Receipt testing for “pure” food pro-cessing as well as all other aspects of the law.

The FSMA adds the following: Inspection of Records Hazard Analysis Written Food Safety Plans Verification of Imports Food Security Registration Dietary Guidelines Tracking and Recordkeeping Laboratory AccreditationWith enforcement, the FDA will now be able to

revoke registrations; issue recalls and issue fines/penalties. These areas and previous requirements are vulnerabilities to companies in meeting com-pliance requirements, and management should be taking immediate action to ensure development of proper programs and levels of compliance. The existing 21 CFR requirements must be met now, while FSMA should be developed concurrently with the issuance of FDA updates. u

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Rick Betz, VP of Brand Segment, GraingerEven though the FSMA is the law, there are numerous regulatory details yet to be finalized, but

undoubtedly, the legislation and ensuing regulations will require all FDA facilities to take stock of where their food safety and quality programs are in terms of food supply chain integrity, trace-ability, and recall protocol. In addition, facilities will need to evaluate the preventative controls, inspections, and corrective actions in their processes, and just as important, how well those pro-grams are documented, monitored and validated.

Most of the leading manufacturers have achieved, or are on their way to achieving, certifica-tion under one of the food safety systems recognized by the Global Food Safety Initiative such as SQF, IFS, BRC and FSSC 22000. Those are significant industry standards that are in addition to the FSMA or regulatory requirements. We expect that the companies that have, or will be, engaged with consultants and certification bodies to meet these industry standards will be the most successful in achieving regulatory compliance.

However, even at a more basic level, if manufacturers take a very close look at where they are in compliance with Good Manufacturing Practices (GMPs) and prerequisite programs, that is a crucial first step in working towards compliance. Additionally, there are some aging processing facilities still in service, and manufacturers will have to decide if those facili-ties can be upgraded for regulatory compliance and what level of investment is needed to do so. In some cases, the heightened standards for food processing environments may encourage relocations to modernized facilities. u

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27Miriam Guggenheim, Partner, Covington & Burling

Marialuisa Gallozzi, Partner, Covington & BurlingManufacturers would be wise to examine where food safety risks arise during their manufacturing process-

es, and ensure that they are taking steps to prevent or control such risks. As part of this assessment, manu-facturers might want to consider the integrity of their supply chains, particularly with respect to imported ingredients, to help ensure that quality and safety are built into their products from the outset.

Conducting such an assessment now will help food manufacturers be better prepared for future regulatory requirements, and will enable them to share best practices with FDA to help shape those requirements. It is a good idea to keep abreast of FDA’s rulemaking activities for implementation of the FSMA, and food manu-facturers might consider engaging with the agency on these activities, either on their own or as part of trade associations or other coalitions. A key upcoming opportunity for industry input will be FDA’s proposed rule on

hazard analysis and preventive controls plans, which is expected this fall. Manufacturers may wish to comment on that proposal to help ensure that the ultimate requirements imposed on food manufacturers are not unduly burdensome or unnecessarily inconsistent with current practices.

A manufacturer also may have other protections available if, despite its efforts to ensure the safety of its product, a recall or a contamination incident does occur. First, recall readiness is an important aspect of recall execution. A manufacturer can use drills and other exercises to assess whether it is prepared to carry out a rapid and thorough recall and to communicate effectively with customers, suppliers and regulators about a recall. Second, a manufacturer also may be able to minimize financial loss stemming from a recall or contamination incident by seeking recoveries from third parties. Potential routes of financial recovery include: indemnification by parties who might have some responsibility for the incident (or their insurers); and insurance coverages available to the manufacturer itself including, for example, liability insurance and “specialty” insurance coverage that might cover recall execution and crisis management costs. Well-planned recall execution, cost recovery and crisis management can help protect consumers and the company brand. u

28 BRAINSTORMMike Lee, CEO, Airclic

As the FSMA begins to take effect, food manufacturers should be ready to invest in upgrades to their supply chain technology to ensure that they have robust tracking and tracing capabilities as part of their food safety plan. This ensures that data is captured at every relevant point in the supply chain, ensuring compliance and proper documentation.

With the technology available today, manufacturers are able to implement capabilities such as item-level scanning and keep electronic records of products from source to destination — as opposed to inefficient and error-prone paper-based processes. Not only does technology allow ease of compliance to the new standards, having data available allows the manufacturer to respond quickly should a food safety incident or recall occur.

It is important to implement this technology sooner rather than later — complementing safe food handling and processing practices with supply chain technology that tracks and traces from the source to the “last mile” does not require what used to be prohibitive investment in time and dollars. Public health and food safety are critical issues for which manufacturers have always advocated. Implementing supply chain technology as part of FSMA compliance reinforces that commitment. u

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