Preventing The Next Product Recall
Facing the largest recall of food products ever in U.S. history, the food industry is taking a long hard look to correct what went wrong to cause nine deaths and hundreds of sick people stemming from the salmonella poisoning of peanut butter manufactured at Peanut Corp. of America (PCA). According to the U.S. Food and Drug Administration (FDA), more than 200 manufacturers downstream in the food supply chain have had to recall their products, representing more than 2,100 different products in 17 categories.
Some critics blame the FDA for everything from botching inspections to being too slow to react to the outbreak. Still others defend the agency, citing its limited authority prohibited it from taking the actions it would have wanted to take.
The cost to the industry is still to be determined as the story continues to unfold, but it could hit a half a billion dollars, predicts Bill Marler, managing partner of Seattle-based Marler Clark, a firm dedicated to representing victims of food poisoning.
“The illnesses and deaths are tragic, but these are a small part of the overall cost of the litigation,” he reports. “The real cost is damage to the brand and the fact that peanut production is down by about 25 percent.”
When put in perspective, this is a lot of damage from a company producing less than 1 percent of all peanut products used by U.S. food manufacturers. This underscores just how fragile the food safety chain is and how just one weakest link negatively affects food safety throughout the entire chain.
SIFTING THROUGH THE RUINS
PCA is a bad actor and in no way is representative of the entire food industry, says Craig Henry, PhD, senior vice president and COO of scientific and regulatory affairs for the Grocery Manufacturers Association (GMA) in Washington.
Even with food safety regulations in place, something went terribly wrong. “From the moment a company decides to be involved in the food business, they have taken on a very big responsibility,” reminds Jill Hollingsworth, vice president of food safety programs for Arlington, VA-based Food Marketing Institute (FMI).
“With this case we have seen the potential to reach thousands of people from a single food source. But unsafe food is not the norm. When you think of the volume of food produced in this country, consumed day in and day out, a mind-boggling amount of food is safe food.”
So what went wrong and how can the industry prevent something similar from ever happening again?
Marler says PCA was clearly out of control. “This company’s facilities were run with little interest in food safety and potential for food contamination. Judging from the documents released at the congressional hearing, production was more important to them than food safety.”
Audits at PCA’s Blakely, GA, facility completed in 2008 by the Georgia Department of Health or any other third-party auditors clearly missed warnings that were there to be seen, reports Marler, who is representing 65 of the over 600 people affected by the PCA outbreak. The FDA inspection done this January reported structural and long-standing problems at the Blakely plant.
PCA’s Texas facility had been operating for years under the radar, having never even been registered or inspected by any agency. Violations there were discovered to be long-standing and included mold growth on walls, interior water damage from the roof and access points for birds and rats.
Marler brought lawsuits against PCA and its president, Stewart Parnell, as well as Kellogg in Georgia’s federal court. He will file additional lawsuits against other manufacturers like King Nut and others who used PCA products to make consumer goods, aiming to discover where the breakdowns were in the production facilities, the chain of distribution and the auditing process.
The law views manufacturers of a food product to include growers, processors, re-manufacturers or private label companies offering a finished product they have not themselves manufactured—like King Nut.
“If you are a private label manufacturer, you really need to know who is making your product and that they are producing a safe product,” Marler cautions. He adds that liable companies within the chain of distribution may argue among themselves as to who is more liable or less liable in this case.
One of the changes that will happen as a result of all of this relates to how the FDA’s field staff will collect samples during their routine inspections. One lesson learned is that although peanut butter does not support the growth of bacteria, once bacteria gets into the product it remains stable and divides very quickly once ingested by humans. Therefore, FDA field staff will now be required to collect samples of food products, as well as samples from the environment.
“There is a whole science governing where you take environmental samples—such as from the equipment used to manufacture products and from floor drains,” explains Stephen F. Sundlof, DVM, PhD, director of FDA’s Center for Food Safety and Applied Nutrition.
The field is full of finger-pointers pointing to the government and to particular companies. “Government has a role, but it failed,” notes Doug Powell, PhD, associate professor of food safety at Kansas State University. “But government failure is minor compared to corporate failure. Everyone is focusing on government, but it is really up to the food industry to produce a safe product. Even if you had inspectors present 24/7, if people want to break the law, they will do so. In this case, criminal charges are being pursued, which very rarely happens.”
COMMITTED TO FOOD SAFETY
The industry leaders we spoke with agree that achieving food safety must be approached through responsible and honorable partnerships among the participants of the food chain—from raw goods through finished products.
“There has to be an environment of partnership because if that is lacking, little else will fix this,” says Jim Munyon, president of Manhattan, KS-based AIB International. “Third-party audits are a component within the partnership and they have to work in concert with [food-chain participants’] proper systems and procedures, a culture of continued improvement and continual employee training. There needs to be full disclosure and integrity throughout this partnership.”
Munyon notes this situation is a rarity and that the food and beverage industry has always been committed to food safety. “It certainly does not work in any company’s interest to have a failure like this. Everyone in the food industry is both saddened and appalled by this situation and we are all doing internal reviews on continued improvement. Food safety requires commitment to a safe food supply; this commitment was clearly lacking here.”
Because food passes through many steps, changing hands from one factory to another, the potential exists for something to go wrong throughout the links if one participant along the chain acts irresponsibly. “Everyone must accept responsibility for their piece of the food chain,” FMI’s Hollingsworth says. “When something goes wrong, it has the potential to hurt many. So we have to learn from instances like this and we must do whatever it takes to produce safe food.”
Having as many checks and balances as possible within the food chain helps assure food is produced safely, continues Hollingsworth.
“FMI is a strong supporter of third-party certification, which is a type of audit,” she says. In fact, FMI owns one of these programs, called Safe Quality Food (SQF), which involves an in-depth understanding of a company and how it manages its day-to-day business from a safety perspective.
“We help companies recognize where they might have weaknesses and we also identify those companies doing an outstanding job. Third-party certification offers one more set of eyes and ears making sure that everything that can be done in a prevention program is in place and working,” says Hollingsworth. “Third-party certifications are an excellent tool, but we still want government inspections.”
Clearly, it is the responsibility of the food industry to produce safe products, says FDA’s Sundlof. “Nothing will improve things more than industry stepping up and taking a stronger role in making sure they know their supply chain and knowing they have good systems in place that will prevent the intrusion of contaminants into the food they produce.”
Marler at Marler Clark says the PCA outbreak underscores the necessity on the part of private label manufacturers and re-manufacturers not to rely on indemnity agreements or insurance policies between themselves and the producer. “They need to get more engaged. When a company like Kellogg is relying on a company like PCA, Kellogg is taking the bigger risk because of its brand. So they need to do more than what they are currently doing to protect that brand.”
AUDITING FOR FOOD SAFETY
Everyone in the industry agrees that producing safe food requires a multi-layered approach that includes every participant in the food chain. FMI’s third-party certification program, SQF, offers yet another tool to that approach. “This program is intended for any company producing, manufacturing, or supplying food,” Hollingsworth explains. “It can be used by anyone in the food industry—from a farmer to a very sophisticated processing company.”
This certification has stringent controls and oversights in place. With the input of industry, the science community, and other experts, FMI developed the standard it expects all food companies to be able to meet. It includes food safety rules and regulations, best practices, and Codex and ISO standards.
“It is truly a certified assessment of how a company performs,” explains Hollingsworth. “It allows suppliers to use their certification as a tool to let their customers buying food from them know they are doing everything they can to produce safe food.” There are five of these programs globally and this is the only one of its type in the U.S.
Hollingsworth reports the FDA is supportive of this approach, having the industry take a leading role in voluntary certification programs to provide an additional layer of monitoring safe food along the chain. Under the SQF program, each facility must be audited at least once a year.
Munyon at AIB agrees there is no one formula to assure food safety and that an audit is one piece of that assurance, but it shouldn’t be the only piece. “I think it’s important to look at the risk profile of the products you are purchasing and to assure yourself that those risks are being examined by one element or another of the program.”
Regarding AIB’s audit of PCA in Q1 of 2008, Munyon reports it was a standard GMP (Good Manufacturing Practice) audit. “That audit was performed and delivered and at that time there were no major exceptions noted. What is not apparent through any audit is the disregard of information that comes to the management of a food facility that there is a problem. No audit could have prevented this, as an audit does not guarantee that the programs will be executed per the written documents. That was clearly the case with PCA.”
SAFETY GOING FORWARD
Capitol Hill has a number of ideas for legislation it is now floating from the food industry and government. One of particular note would invest the FDA with more authority than it currently has.
“There have been things coming out of the PCA situation that demonstrate the FDA lacks certain authorities that would have been beneficial—in this case identifying the problem before it became an outbreak,” reports Sundlof at the FDA. “At the present time, we can’t access critical records unless we can demonstrate there is a public health concern. So one of the things we will be discussing with Congress is having greater access to records before a harmful event occurs. Also, having direct authority to recall products would help prevent further illnesses.”
The FDA is also seeking authority to require food companies to have preventive safety and quality systems in place. “This would allow the FDA to audit a company to assure they have an acceptable system in place, that they are actually doing what their system calls for, and that they are keeping records of these activities,” explains Sundlof. Furthermore, the FDA wants to have a safety system in place that would look across the entire food supply chain, providing yet another layer of security.
Better control over the food supply chain will be a top priority going forward, promises Sundlof. “To the extent that the FDA can help, we will do that. In this case, PCA had auditors go out to certify that the plant was superior. This was the assurance the downstream companies were relying on and that system turned out to be a failure.”
GMA recently sent a letter to Congress calling for food safety reforms including granting the FDA mandatory recall authority. It also asked that a national standard be imposed on higher-risk fruits and vegetables.
“Most people agree that regulations on paper don’t necessarily result in compliance,” states Henry at GMA. “Assuring a safe product is conveyed to the consuming public can only be achieved through the proper execution throughout the supply chain, including the responsibility of regulators in tandem with the industry.”
Going forward, companies will be looking upstream to take a closer look at the processes being employed by suppliers to them of finished products, says Henry. “Manufacturers will learn from this how they can enhance their process of approving their suppliers and verifying the quality and integrity of the products they receive.”
Munyon at AIB says the industry will implement improvements, enhancements and program reviews, cautioning companies to honor the principles laid out over years of effort by so many companies in the industry.
Experts in the industry believe food companies should be required to have a risk-based food safety plan. Hollingsworth at FMI notes that the organization’s SQF standard mandates this.
“We think if this is something we as an industry support, there is no reason the government shouldn’t say everyone should have such a plan,” says Hollingsworth. “Whether it takes legislation or regulations to get such things as food safety plans and mandatory recall authority in place to make our food supply as safe as it can be, then we will support those ideas.”
Checklist For Assuring Food Safety
Minimizing the safe delivery of food all along the food supply chain can be achieved by following some simple suggestions from industry experts.
- Establish an environment within your supply chain of cooperation and partnership, with an eye to operating with integrity and full disclosure;
- Know your suppliers and understand what their best practices are for food safety; work with suppliers to verify the quality and integrity of the products they supply to you;
- Know the risk profile of the products you are purchasing from suppliers; ensure those risks are being monitored by one element or another of your risk-based food safety program;
- Ask yourself where in your supply chain your products might be at risk;
- Establish a list of best practices with the help of industry experts;
- Establish a food safety plan that lays out the potential points of hazard in your facility and how you would correct those; keep records of these remedial activities;
- Push for transparency and reportable results of audits throughout the industry;
- Push for all food manufacturing facilities to establish HACCP (Hazard Analysis Critical Control Point) programs;
- Push for testing protocols of facility environments and finished samples—and for these test results to be completely transparent and reportable. —A.T.
Dealing With A Massive Recall
The largest recalL of food products in U.S. history is motivating the industry to think proactively. As those in the recall industry remind us, recalls are high-risk, low-probability events. But when a recall happens, a whole set of cascading events immediately goes into action. Are you prepared?
Inmar CLS Reverse Logistics processed over 1 million items involved in the PCA peanut butter product recall since mid-January through February, notes Ashley Kerman, director of recall client services for Inmar CLS Reverse Logistics headquartered in Winston-Salem, NC.
“We offer our clients a service to prepare for recall management, as preparation is the biggest part of a recall and helps make the overwhelming process flow a lot more smoothly,” says Rodney Bias, vice president of regulatory compliance.
According to a keynote address giving at the Food Safety and Security Summit in March 2008, companies with a crisis and recovery plan in place show a 10-percent increase in shareholder value one year after the event.
Recalls happen in a few ways, explains Kerman. Manufacturers, suppliers, retailers or wholesalers can initiate the recall. “Because this recall was so huge, we were receiving (and continue to receive) notifications directly from the FDA on a daily basis. They told us to hold all this product until they were sure we would be destroying it in a regulatory-compliant manner,” she says.
Some state regulatory agencies notified Inmar facilities of the recall and outlined handling procedures.
“With a recall of this size, our facilities will get numerous federal and state inspections to ensure we are handling the product properly,” explains Bias.
Once notification is complete, a chain of recovery and disposal events goes into motion including product retrieval, transportation, processing, reimbursement, disposition and reporting. “The costs will include product costs, destruction costs, handling and transportation, and lost production costs,” reports Kerman. “Manufacturers lose their production costs and they have to pay for the recalls because they must reimburse all the retailers involved.”
Inmar helps manufacturers develop protocols and the organizing teams that would be involved in a recall event. It operates about 40 reclamation centers nationwide.
“When a recall of this magnitude happens, most manufacturers are not equipped to bring individual items back into their supply chains,” explains Kerman. “So this network of ours helps facilitate getting product out of the stores to a centralized place for processing, counting, record keeping, and final destruction. We offer witness incineration or witness landfill dispositions for manufacturers.”
Retailers will want to scan the recalled products and get them out of their stores and back to the manufacturer as soon as possible, continues Kerman. When products arrive at the reclamation centers, they are scanned so retailers get credit and manufacturers are billed back.
Inmar encourages everyone in the food supply chain to follow its list of best practices. “Preparation is a good investment, because a recall can be a very painful and costly process,” says Bias. —A.T.