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Cheerios Cereal Isn't So Wholesome as Package Claims

By Catherine Larkin and Duane Stanford

May 12 (Bloomberg) -- Cheerios, the world's best-selling cereal, isn't so wholesome as its maker General Mills Inc. claims, U.S. regulators said.

By Catherine Larkin and Duane Stanford

May 12 (Bloomberg) -- Cheerios, the world's best-selling cereal, isn't so wholesome as its maker General Mills Inc. claims, U.S. regulators said.

Packaging and Internet advertising for the toasted oats violate federal law with promises to lower cholesterol and reduce the risk of heart disease and cancer, according to a warning letter posted on the Food and Drug Administration's Web site today. General Mills, ordered to fix the issues or risk product seizure, said it would try to resolve the letter with the regulator.

The FDA allows food companies to make nutritional claims backed by scientific studies, and restricts wording. Health claims have helped food and beverage makers boost sales as more consumers struggle with obesity. Food companies are testing the regulators relatively subjective view of how much scientific proof is needed, said Christopher Shanahan, an analyst at Frost & Sullivan Inc. in Mountain View, California.

We certainly don't have any issues with the safety of Cheerios, Stephen Sundlof, director of the FDA's Center for Food Safety and Applied Nutrition, said in an interview today. We just believe that the labeling on this particular product has gone beyond what the science supports.

The FDA started its Cheerios review after the National Consumers League, a Washington-based advocacy group, complained in a September letter that the cereal's health claims made it out to be a drug, Sundlof said.

The warning letter represented the FDA's first action against a mainstream food product” in more than nine years and showed the agency is exerting its authority under President Barack Obama, said Bruce Silverglade, director of legal affairs for the Center for Science in the Public Interest, in Washington.

Doctor's Advice

“Consumers are influenced by food claims on labels, Silverglade said in a telephone interview today. To the extent that they're misleading, it's as bad as a doctor giving out poor medical advice.

General Mills, based in Minneapolis, rose 74 cents to $53.65 at 4:15 p.m. in New York Stock Exchange composite trading. The company is the second-largest cereal maker, after Kellogg Co., of Battle Creek, Michigan.

Cheerios was introduced in 1941 as the world's first ready- to-eat oat cereal, according to the product's Web site. The honey-nut variety came out in 1979, followed by apple cinnamon, multigrain and frosted flavors. The cereal box has said for more than two years that the product can lower your cholesterol 4 percent in 6 weeks for more than two years, according to General Mills.

Rising Sales

General Mills' cereal sales rose 13 percent in the third quarter ended in February, helped by the marketing of Cheerios health benefits, Chief Executive Officer Ken Powell said during a March 18 conference call.

Cheerios, which is the largest franchise in the category, is also one of the fastest-growing brands in the category, Powell said during the call. So that's a great story.

The company believes the science behind the cereal's claims is not in question, Tom Forsythe, a spokesman for the cereal company, said in an e-mailed statement today. The FDA is interested in how the Cheerios cholesterol-lowering information is presented on the Cheerios package and Web site. We look forward to discussing this with FDA and to reaching a resolution.

Cereal or Drug?

The FDA took issue with Cheerios boxes that say the cereal can lower cholesterol. That statement qualifies Cheerios under U.S. regulations as an unapproved new drug, the FDA said. While the agency allows a health claim linking soluble fiber from whole grain oats to a reduced risk of heart disease by means of lowering cholesterol, Cheerios boxes have cholesterol as a prominent, stand-alone claim, the FDA said in its letter, dated May 5.

Cheerios' online marketing of heart disease and cancer benefits also fails to include language the FDA requires about other foods that help reduce risks, according to the agency.

The claim on your Web site leaves out any reference to fruits, vegetables, and fiber content, the FDA letter said. Therefore, your claim does not convey that all these factors together help to reduce the risk of heart disease and does not enable the public to understand the significance of the claim in the context of the total daily diet.

Kellogg's box for Frosted Mini-Wheats also has fallen under U.S. government scrutiny. In April, Kellogg settled Federal Trade Commission charges that it falsely advertised the cereal to improve children's attentiveness. The FTC said the clinical study Kellogg cited found that only half the children who ate the cereal showed any improvement in their attentiveness.

We stand behind the clinical results,” Kellogg Chief Executive Officer David Mackay said in an April telephone interview. Their concern was that it may have tried to say something that we weren't intending to say. We made that modification and we move on with life.

To contact the reporters on this story: Catherine Larkin in Washington at clarkin4@bloomberg.net; Duane D. Stanford in Atlanta at Dstanford2@bloomberg.net.

Last Updated: May 12, 2009 16:42 EDT


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