How technology demystifies global compliance

| Product Lifecycle Management | Supplier Relationship Management | Specification Management
Posted By: Trace One

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Note from the editor: this article first appeared in the July 2021 issue of Personal Care Magazine.

You have probably heard it already, but there are not a lot of common definitions among global regulators when it comes to cosmetics. Requirements in one country might have very little in common with another.

The lack of agreement spans several silos, from the definition of a cosmetic product to an ingredient to primary use. But the onus falls on you, the owner and developer of the product, to verify and clearly present your claims.

This grey area, specifically the lack of consensus between various authorities, muddles the development space, making it difficult for the cosmetics industry to create and quickly deliver new products to consumers.

With safety on the top of everyone’s mind, clear practices and tools have been created to untangle some of this semantic confusion. This technology not only brings clarity, but also helps improve agility and speed to market.

Here are some ways technology helps to demystify global regulations around cosmetics. Let’s dive in.

So, what is a cosmetic?

In the United States, a product can be both a cosmetic and an over-the- counter drug, depending on intended use. In Europe, specific claims determine whether the product is or is not a cosmetic. And in Japan, it is a cosmetic largely depending on the purposes and effects of the product.

Out of the gate, it is easy to see how varying regulatory definitions of a cosmetic product creates confusion. Depending on specific rules and regulations, it is likely that a cosmetic has different classifications in different countries.

Returning to Japan, regulators there categorize products as medicines, quasi-drugs, and cosmetics. This classification determines how a product can be marketed. The difference between the three classifications? A medicine is a cure or designed for healing. Quasi-drugs are preventative. Cosmetics are for maintaining one’s beauty. But it is a bit more complicated than that. Also included among quasi-drugs are “cosmetic drugs”, which have an intended use similar to a cosmetic, but are not classified as such. Claiming special aesthetic effects through the designation of an active ingredient designates the product as a quasi-drug not a cosmetic.

The first step is assessing which category the product falls under in any given market. This requires careful research and documentation. Do not be surprised if different markets have different classifications but knowing and verifying these requirements help advance a compliant go-to-market strategy.

Using technology can focus on the key aspects of entering a new market. Solutions exist to help support these efforts, including tools that reduce the amount of time spent on significant compliance tasks.

When is a cosmetic just a bunch of chemicals?

Take a second and imagine a tanker truck rolling down the highway carrying a load of liquid irritant, most likely very flammable. The cargo is a tank full of fragrance, moving from chemical manufacturer to a cosmetics company where it will be used as an ingredient in a mixture. From a regulatory perspective, are we talking about a chemical or a cosmetic?

The overlapping relationship between chemicals and cosmetics is another example of how easy it is to introduce confusion into regulatory compliance checks for cosmetics. It is not uncommon for cosmetic ingredients to be part of chemical inventories maintained by regulators. This leads to further contradictions, where chemical ingredients are classified differently across borders. The TSCA, used in the United States, does not account for cosmetic ingredients, whereas the Canadian Domestic/Non-domestic Substances List (DSL/NDSL) considers cosmetic ingredients in its chemical substances inventory.

The blurry regulatory boundaries between chemical ingredients and cosmetic products creates additional inconsistencies. Companies looking to develop products with global reach should rely on digital repositories and databases that can hold current information for differentiating cosmetic and chemical ingredients in a given market.

Moreover, if the need is to manage huge quantities of a cosmetic that is not yet in its final, ready-to-consumer form, digital tools help create the mandatory documentation for mixtures of chemicals, including during transportation.

The safety of a cosmetic relies on its ingredients

Cosmetic regulations are built on a common principle that the safety of a product primarily relies on the safety of its ingredients. To that end, regulations of cosmetics across various regions are mainly interested in the quantity of a given substances within a formula as well as the final cosmetic product type in which the substance is included.

To stay on theme, here too we find a degree of variability. Once again, you will find that different limits and exceptions are found in different regions, creating circumstances where a formula is compliant in one market but not another.

The United States largely looks to the Federal Food, Drug, and Cosmetic Act of 1938, which regulates a small number of substances. By contrast, you will find more than 4,000 substances in EU Regulation 1223/2009 on cosmetics, which builds a comprehensive framework for the regulation of cosmetics in Europe.

EU Regulation 1223/2009 on cosmetics introduced a detailed list of prohibited substances along with limits on permitted ingredients. Afterwards, several other countries began using the EU standard as reference for implementing their own laws and regulations. China, for example, has implemented a similar approach for regulating cosmetics, albeit with some modifications.

Knowing that different countries will define limits on the ingredients of cosmetics with their own safety standards in mind, companies must track these requirements to stay compliant.

Formulating a product to less defined regulations, such as the Federal Food, Drug, and Cosmetic Act might limit the global reach of a product, especially when compared to the more rigid standards of EU Regulation 1223/2009 on cosmetics.

When compliance steps are taken during the early stages of new product development, companies can gain a competitive advantage, reducing the number of reworks and back and forth between Regulatory Affairs and the lab. In researching and documenting different regulations as part of the innovation process, manufacturers gain insights into market strategies.

Using a PLM solution (Product Lifecycle Management) capable of managing limits on specific ingredients and tracking substances according to regulation assures products stay compliant. A solution with traceability reduces human error, giving visibility into how compliance steps have been executed during each stage of production.

Regulation also comes from within

With no consensus from global governing bodies, the cosmetics industry has learned to look inward for best practices. By creating and demonstrating responsible practices, industry groups have established international standards for protecting consumers.

This is especially true for fragrances, where the International Fragrance Association, or IFRA, have helped to develop standards adopted throughout the world. By basing decisions on highly scientific studies, IFRA is able to provide guidance on products made from complex ingredients, especially substances with natural origins being used in perfumes.

Self-regulating industry groups like IFRA help companies align practices and standards to existing global regulations. This includes evaluating and understanding maximum dosages and substance limits for products. By sorting through the confusing regulatory space for manufacturers, groups like IFRA support the creation of complex products, such as face creams, fragrances, or candles, that are in agreement with existing expectations.

Technology solutions that account for guidance from industry groups like IFRA make compliance checks easier. Certain PLM solutions are capable of reaching the levels of granularity needed for regulatory affairs

specialists to successfully perform their duties, including analysis on formulas and the ability to create IFRA certificates that can be shared with customers.

It is only natural to be confused

Natural” claims in beauty products are a complex discussion in and of itself. Natural is one of the most popular trends in the beauty and cosmetics industry, but with no regulation defining the term, “natural” has become a prime use case for compliance confusion.

For example, is water natural? Some say yes, others say no. Considering that water is often the first ingredient in several cosmetics, this distinction makes a difference.

Often, naturality standards are relative to the number of natural ingredients in a formula. The same is true for vegan and organic claims. These attributes can be difficult and time consuming to verify, especially when silos in the lifecycle create splits between the lab, the suppliers, and regulatory team. But safety is still top of mind for companies making natural claims.

Check out our "Going Natural" blog post series: 

It's only natural to be confused about naturals

Looking at natural claims around the globe

Questions from the industry-Naturals claims in food manufacturing

Questions from the industry—Compliant practices for added sugar and natural alternatives

Consumers believe natural products are safer than synthetic ingredients, even if that is not necessarily true. Of the 26 cosmetic allergens, 18 are from natural ingredients. Because of this, there is a greater need for safety in natural beauty products.

The allergen-prone and potentially harmful risks associated with some of these natural ingredients, including essential oils and fragrances, make the guidance from IFRA particularly useful.

Fragrances and essential oils are complex natural extracts which often contain allergens. More complex than synthetic ingredients, extracts and essential oils are regulated by IFRA’s globally accepted standards Clear labelling of allergens is very important for consumers and manufacturers. After a product is assessed for safety, it must be transparently labelled. Failing to do so not only risks reputational damage but puts consumers at risk.

With technology, Formulators can verify material origins while developing new products. This helps to validate claims of natural, vegan, and organic in products, speeding up regulatory checks.

PLM solutions help manufacturers measure the percentage of natural ingredients in a formula, making it possible to make natural claims based on the relative number of ingredients. Not only does this make labelling clear but helps to unwind the differing views based on market requirements.

Staying compliant while staying local

Like the rise in natural ingredients, locally sourced materials have become increasingly attractive to consumers. Brands frequently reference and highlight local materials, calling attention to cultural associations and the company’s support of regional communities. Sourcing is a challenge in and of itself, especially when regionality is valued.

Consistency must be maintained between the product and the label information, assuring consumers the country of origin and ingredient names line up with marketing messages.

Cosmetic companies can use PLM solutions to store information on a product and its materials. Once this data is integrated into product development, it is easier for teams, including Formulators and Regulatory Affairs, to verify natural and regional claims. Regionality attribution and country of origin can be added to ingredient sourcing. This data and intelligence shorten product lifecycle timelines and gives product managers a consistent database to rely on.

Additionally, a good PLM solution translates formulas and materials into clear labels, keeping consumers safe and preserving a truthful and consistent branding message.

The product still has to be proven safe

It is not enough to know limits on regulated ingredients, you still need to demonstrate the safety of the overall product.

Assessing the product as a whole requires companies to outline specific details about the manufacturing process, the results of several testing, including certain toxicology considerations, such as the Systemic Exposure Dose and the Margin of Safety for each ingredient.

These steps exist to recognize different exposure levels based on usage. A hairdresser, for example, comes into contact with shampoos and other cosmetic products at a much greater frequency than the average consumer.

To keep these users safe, manufacturers must calculate a large amount of information based on varying exposures. Oftentimes this results in a large dossier for each product, listing the different exposure routes and tests done on the product.

The Product Information File (PIF) is one of the most important legal requirements for bringing a cosmetic product to the European market. When a cosmetic product is placed on the EU market, the responsible person shall keep a Product Information File that must be available on request. The PIF offers visibility into product details, including manufacturing process and ingredients.

Certain PLM systems have the ability to automatically perform exposure calculations and generate compliance documentation. Not only does this improve review efficiencies, it reduces human error and gives peace of mind. Moreover, maintaining updated dossiers for each product placed on a specific market can be a very time-consuming activity. Technology simply speeds up and streamlines these recurring tasks.

Clearly labelling your product is the name of the game

Having reviewed regional requirements, mapped ingredients to different regulators, evaluated limits, benchmarked against industry’s standards, and performed analysis on the final product, it is still possible to be non-compliant due to one major hurdle—labelling.

You probably rely on the INCI, or the International Nomenclature of Cosmetic Ingredients, to identify ingredients.

Unfortunately, not all INCI names have universal recognition.

As an example, the aforementioned “water," aka the most common ingredient in cosmetics, is listed differently depending on region:

  • In the United States, it is simply “water”.
  • In the EU, it is “aqua”.
  • In Canada, it presents as “eau/ water,” which is then transliterated for Japan and

Failing to include an accurate ingredient statement on the label will prevent the product from being market ready.

A PLM system can evaluate formulas and generate an accurate INCI statement, adjusted for the target market. By retrieving all of this information and correctly listing it, cosmetic companies gain assurance that their products are accurately representing themselves in different markets.

The answers can be found in technology

The lack of consensus across regions means regulation will always be a sore spot for cosmetic companies, but having the right tools makes it easier.

Cosmetic companies can use technology to store information on a product and its materials. Once this data is integrated into product development, it is easier for teams, including Formulators and Regulatory Affairs, to verify a variety of claims, including natural and regionality.

PLM systems make it possible to manage ingredient limits in a formula for a target market, facilitating development strategies and compliance steps.

Beauty manufacturers seek any advantage they can to stand out in competitive markets. Local and natural ingredients continue to be popular with both Formulators and consumers. Technology assures that everyone is protected.

Technology can be a single source of truth. This helps carve through the confusion around cosmetics and their ingredients, speeds up time to market, and helps companies create safe products with clear, transparent labels.